Competitive horizon

Strategic Direction

ISSN: 0258-0543

Article publication date: 23 May 2008

Citation

(2008), "Competitive horizon", Strategic Direction, Vol. 24 No. 7. https://doi.org/10.1108/sd.2008.05624gab.001

Publisher

:

Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited


Competitive horizon

Article Type: Competitive horizon From: Strategic Direction, Volume 24, Issue 7.

Boom times ahead for Indian rubber industry

A report published by The Times of India (www.economictimes.indiatimes.com) claims that manufacturing growth has put India on course to become the world’s second largest rubber producer in the approaching years. A manufacturing boost to both domestic and export sectors will see the Indian rubber industry surpassed only by China. The industry may also benefit from the rising average compound annual growth rate (CAGR) within domestic sectors that consume rubber products. For instance, demand for rubber could reach 10 percent if robust growth occurs within high potential areas such as the automotive sector. In addition, the All India Rubber Industries Association (AIRAI) believes that export demand could fuel growth levels of between 12 and 16 percent that could last until 2015. However, the association points out that government support is vital if these targets are to be achieved. Price instability and high import duties on natural rubber along with unpredictable supply and high input costs are the main issues needing to be addressed.

LCD dominance set to increase further

The forthcoming years should see liquid crystal display (LCD) increase its supremacy in the flat panel television sector, according to a report published by the New Zealand Herald (www.nzherald.co.nz). Research carried out by the Japan Electronics and Information Technology Association (JEITA) has indicated that strong demand within China and the US in particular will see annual sales double to 180 million units by 2012. LCD is forecast to account for 155 million of these sales, with the remaining 25 million units being plasma. In 2007, LCD and plasma sales were respectively 74.8 million units and 11.4 million units. Expected demand from 51 countries including all the major nations provided the basis for survey predictions.

Middle East construction drives demand for aluminum extrusion

Demand for aluminum extrusion within the Middle East has soared on the back of a continuing boom in the construction sector. At the end of 2007, 25 new extrusion presses increased the number in the region to 85. In 1980, there were just seven. Industry insiders claim that 90 percent of such aluminum products are driven by construction industry demands. A report published by Gulf News (www.gulfnews.com) claims that construction activity in nations such as Qatar, Kuwait, Saudi Arabia and the UAE will ensure that 450,000 tons of aluminum extrusion will be needed in 2008. To meet rising demand, the next three years will see new facilities in Qatar, Saudi Arabia and the UAE, where a 20,000 ton capacity plant is scheduled for Abu Dhabi. Despite the optimism for growth, the industry is aware of the impact of rising energy costs on the price of aluminum and fear that some builders may therefore be persuaded to consider alternative materials such as plastic.

The economy in Canada

According to a report published by the Vancouver Sun (www.canada.com/vancouversun), a strong increase in infrastructure spending and a booming service sector will help the Canadian economy in the face of sluggish performance in manufacturing. Scotiabank has downwardly revised its forecast for 2008 growth in Canada’s manufacturing heartland from 1.5 to 1.4 percent. The financial institution blames increased competition from abroad and a significant slowdown in the US dollar for manufacturing woes. The report also believes that weakening US demand will impact on the auto sector in Ontario, resulting in lower output and shipment of parts during 2008. Both public and private sectors are predicted to fuel investment in construction, with ongoing oilsands pipeline work and energy and mining developments accounting for much of the spending. Employment opportunities are expected within financial services and should help offset some of the manufacturing job losses.