A Tough Year
In 2012, chemical executives had to deal with another economic slump while the Great Recession was still fresh in their memories. In Europe, the sovereign debt crisis precipitated a return to recession. And chemical makers cut costs and shuttered manufacturing capacity in that region and elsewhere to maintain profitability.
The U.S. remained a bright spot for the global chemical industry because of low-cost shale-based raw materials. Although the prospect of stricter regulation, driven by environmental concerns, hovers over the shale gas business, petrochemical companies were confident enough that shale gas will keep flowing that they invested billions of dollars in new plants based on it. Chemical firms, however, were more cautious about mergers and acquisitions; deal-making moved at a slow pace in 2012, and few multi-billion-dollar transactions were announced during the year.
Overall, fine and custom chemical makers had a good year. However, explosions—with lives lost—compromised supplies of specialties such as a nylon raw material and superabsorbent polymers. In the crowded cleantech field, some firms such as battery maker A123 Systems failed outright while others formed partnerships to increase their chances of survival.
Intellectual property disputes clogged court systems throughout the year as competitors argued over technology ownership. And quarrels over raw material resources and the selling of chemicals below cost went international.