Market Monitor chemicals Poland 2018

Market Monitor

  • Poland
  • Chemicals/Pharma

19th July 2018

Payment behaviour in the Polish chemicals sector has been good over the past two years, and the number of non-payments and insolvencies has been low.

Poland chemicals 2018 pic1

  • According to the Polish Central Statistical Office, chemicals production grew 4.6% in 2017, with rubber and plastics production even increasing 9.5%. In 2018 further production growth is expected, although at a slower pace, supported by GDP expansion forecast of more than 4%.

  • Many players have strong market positions, domestically as well as in Central and Eastern Europe. This enables them to focus on innovations (more than 20% of the existing patents in Poland stem from the chemicals sector) or to expand into new market segments with mergers and acquisitions.

  • Chemicals businesses’ profit margins are expected to remain stable in 2018. Gearing in the Polish chemicals sector is average, and many companies use investment credits in order to finance their investment projects for innovations. Polish banks are generally willing to provide loans to the industry. The Polish benchmark interest rate has remained low at 1.5% since March 2015, and the subsequent low interest rates for credit has spurred chemicals businesses to use bank loans to finance their investments.

  • On average, payments in the Polish chemicals sector take 30 to 60 days, but can take 180 to 240 days for seasonal products (e.g. fertilizers). Payment behaviour has been good over the past two years, and the number of non-payments and insolvencies has been low. Given the solid performance of the chemicals sector, no major increase in business failures is expected in 2018. However, in early 2018 we noticed several payment delays in the fertilizer distributors segment.

  • Our underwriting stance remains generally open for the chemicals sector. However, we are restrictive on fuel wholesalers and smaller fuel station chains in the petrochemicals subsector due to a grey economy in fuel trade in the past, which has led to increased VAT and excise tax controls.

  • Our underwriting stance for the pharmaceuticals segment is neutral, with a more cautious approach concerning drug wholesalers, as the government heavily regulates the market. New regulations on the concentration of pharmacies (e.g. restrictions on pharmacy ownership) and drug distribution could influence performance and results of all market players.

 

Related documents

Disclaimer

Each publication available on or from our websites, such as, but not limited to webpages, reports, articles, publications, tips and helpful content, trading briefs, infographics, videos (each a “Publication”) is provided for information purposes only and is not intended as a recommendation or advice as to particular transactions, investments or strategies in any way to any reader. Readers must make their own independent decisions, commercial or otherwise, regarding the information provided. While we have made every attempt to ensure that the information contained in any Publication has been obtained from reliable sources, Atradius is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in any Publication is provided ’as is’, with no guarantee of completeness, accuracy, timeliness or of the results obtained from its use, and without warranty of any kind, express or implied. In no event will Atradius, its related partnerships or corporations, or the partners, agents or employees thereof, be liable to you or anyone else for any decision made or action taken in reliance on the information in any Publication, or for any loss of opportunity, loss of profit, loss of production, loss of business or indirect losses, special or similar damages of any kind, even if advised of the possibility of such losses or damages.