SÃO PAULO, BRAZIL (Jan. 19, 11 a.m. EST) — Whether due to internal factors or the expected economic recovery in North America, 2004 promises to be a year of growth in Brazil, Argentina and Chile's plastics industries.
In Brazil, if gross domestic product grows at conservative rates of 2-3 percent, production of molded plastics should grow 7 percent, said Merheg Cachum, president of the Brazilian Association of the Plastics Industry, known as Abiplast.
“In a more optimistic scenario, with GDP growing at more than 4 percent, the plastics industry could grow 10 percent,” he said. “Brazil's agribusiness industry is expected to continue with its growth cycle and should help increase sales in the packaging sector,” Cachum said.
Abiplast's preliminary data shows that, last year, molded plastics production contradicted initial forecasts of 6 percent growth, having ended 2003 with a 1 percent drop and totaling 8.7 billion pounds.
“2003 was a year of stagnation for Brazil, and the plastics industry followed suit,” said economist Ronald Caputo, assistant to the president of Abiplast. According to economists, Brazil's GDP is expected to have ended the year with a 0.3-0.6 percent change in relation to 2002. Revenues in the molded plastics sector amounted to US$7.49 billion.
In Argentina, the plastics industry expects to see an average growth rate of 7-8 percent per year during the next five years, resuming the business activity levels observed in the 1990s, said Oscar Sanchez, general manager at the Argentine Chamber for the Plastics Industry.
In 2001, Argentina defaulted on its external debt and recently presented a payback proposal tied to its economic improvement. In 2003, the country's economy began showing signs of recovery and resulted in a growth rate of 8-9 percent in the plastics industry, compared with 2002. In that year, consumption of plastics products totaled 1.74 billion pounds, which represented a 32 percent drop in relation to 2001.
Sanchez highlighted the construction sector, which has made a significant recovery in recent years, and the packaging industry, as a result of the increase in agribusiness product exports, as the most promising plastics markets for Argentina in 2004.
In Chile, according to Asociacion Gremial de Industriales del Plastico de Chile (Asipla), the industry's national trade association, consumption of manufactured plastics products is expected to grow 3-5 percent. The consumption of manufactured plastics products totaled 1.32 billion pounds in 2003, while the sector is expected to have grown 5-7 percent.
Packaging is the niche that has grown the most in Chile's plastics industry and also registers the highest growth trend.