Widespread flooding in Thailand to shave the country's economic output this year

(ICIS) -- Widespread flooding in Thailand will shave the country's economic output this year, slowing its GDP growth by as much as a full percentage point, given the heavy disruption caused on domestic production, industry sources and analysts said on Wednesday. The Thai capital of Bangkok is on high alert as floodwaters from the central provinces could break through the protective barriers built around the city, they said.

In the provinces of Uthai Thani, Chai Nat, Sing Buri, Ang Thong, Suphan Buri, Ayutthaya, Pathum Thani and Nonthaburi, heavy rains caused rivers to overflow, with the water rushing where Bangkok lies.

Considered as Thailand's worst in 50 years, the floods have swept across 60 of the country's 77 provinces over past two months, killing at least 281 people and shutting down production at hundreds of factories, according to media reports.

The Thai economy is forecast to grow at 3.5% in 2011, barely half the pace of expansion recorded last year, according to the International Monetary Fund's latest World Economic Outlook report in September.

With the devastation being wrought by the flooding, the projected slow GDP growth could be shaved by 0.6-0.9%, with the losses likely to be as high as baht (Bt) 80bn ($2.58bn), according to estimates of government agencies.

Thailand is expected to sustain huge damage to its agricultural sector, estimated at Bt54bn ($1.7bn), according to DBS Vickers. For industries, the losses are forecast at Bt20bn; Bt9.8bn for trade, and; Bt5.7bn for tourism, the brokerage said.

MRC

(Plastemart) - Evonik Industries will build a new production plant for hydrogen peroxide (H2O2) in Jilin Province in northeastern China. An investment of over Euro 100 mln in the project sees Evonik moving another step forward in its endeavor to access new sales markets for this environmentally friendly oxidant. Scheduled to be completed by the end of 2013, the plant will boast an annual production capacity of 230,000 tons, thus increasing Evonik's current overall annual capacity of around 600,000 tons for H2O2 production by nearly 40%. The Group believes it is the world's second largest manufacturer of hydrogen peroxide.

MRC

(PlastEurope) -- In order to meet the EU's preconditions for the creation of Styrolution (Ludwigshafen / Germany) - the 50:50 styrene joint venture between BASF (Ludwigshafen / Germany) and Ineos (Lausanne / Switzerland) - the latter on 1 October 2011 awarded its ABS plant in Tarragona / Spain to its Elix Polymers (Tarragona / Spain) subsidiary, which it subsequently carved out. Elix Polymers will now operate as an independent company.

When the competition authorities had approved the merger of the two group's styrene activities earlier this year - see Plasteurope.com of 05.10.2011 - they had set the condition that the Tarragon plant be divested in order to restore competition in the European market for natural and pre-coloured ABS products.

The Tarragona-based business comprises ABS products sold under the ⌠Lustran and ⌠Novodur trademarks. Ineos said it plans to sell Elix, which has already begun the process of rebranding itself, to a third party.

MRC

(PlastEurope) -- An agreement reached between global packaging giant Sonoco (Hartsville, South Carolina / USA) and private equity firm Metalmark Capital (New York, New York / USA), under the terms of which the former will acquire specialty packaging solutions manufacturer Tegrant Corporation (Arlington Heights, Illinois / USA), will result in the creation of a new protective packaging giant in North America.

According to Sonoco CEO Harris DeLoach, the USD 550m cash and debt deal, expected to close in November this year, is the largest in the company's history and expected to be accretive to Sonoco's 2012 pro forma earnings. Tegrant is expected to generate sales of USD 440m in 2011. Based on this projection, Sonoco could post revenues of about USD 5 bn in 2012. The new businesses will be overseen by existing Tegrant CEO Ron Leach, who has agreed to stay with Sonoco.

Illinois-based Tegrant operates three key business units: Protexic, which it claimed to be North America's leading moulded expanded foam manufacturer; ThermoSafe, which Tegrant says is the world's leading provider of temperature-assured solutions for temperature-sensitive packaging solutions; and Alloyd, which produces and designs packaging, printed products and blister packaging machines. All in all, the group operates more than 30 plants in the US, Mexico and Ireland, with more than 2,000 employees.

MRC

(PlastEurope) -- Technology-led plastics group Carclo (Ossett, West Yorkshire / UK) reported a solid performance in its first half-year - despite the uncertain economic environment. Results were in line with expectations, although the group said it expects profits to rise even more in the second six months of its financial year, which runs to 31 March 2012. The financial position remains strong and a bank re-financing exercise is well under way, with terms agreed, and the group remains confident in its outlook for the full year.

The Technical Plastics precision injection moulding business, which accounts for two-thirds of group sales, benefited from further growth in its US medical activities and, what is termed, significant expansion of its Indian business. Profits for the division will be slightly behind last year's first half, which was unusually strong, but a stronger second half-year is expected to provide continuing growth in profitability.

In the Precision Products division, growth in the Wipac specialist LED supercar lighting business has been positive. Profits are ahead of last year and new programmes continue to be won. Carclo will cease supplying antennas and cables to Ford Motor Company by the end of the financial year, allowing Wipac to focus its resources on growth in LED lighting. The aerospace activities have traded well and returned to profit growth.

MRC