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World Analysis: Business Cases
World Analysis SolutionsThe chemical industry faces uncertainty in energy and feedstock prices and in demand, with potential disruptive forces such as new technologies, sustainability interventions, and trade policies.
In today’s volatile business environment, companies need robust and actionable data and analysis to support their business planning.
The World Analysis provides capacity and supply-demand balances, quarterly long term pricing updates, increased trade granularity and upside/downside sensitivities, allowing you to make better, more informed decisions.
Business Case 1Scenario: Competitive analysis
I need to sync our long-term pricing forecast with on-going changes in global energy & economic markets.
Approach: World Analysis provides long-term annual price forecasts supported by the underpinning assumptions as well as upside and downside sensitivities.
Build your strategic plan with an understanding of the possible outcomes based on changing trend-lines as well as potential global inflection points. Get reliable data for your base plan, enabling you to make educated budgeting and business plan decisions with timely, quarterly price updates and bi-annual sensitivity analysis.
Business Case 2Scenario: Product and market evaluation
I need to understand factors influencing my Base Case business plan with an understanding of upside/downside potential behaviors.
Approach: The World Analysis provides a Base Case view of the economic performance of the chemical product in terms of price, cost, and margin based upon a consistent set of assumptions that represent a “surprise free” perspective. Since the real world is never surprise free, a sensitivity analysis is provided that highlights the underlying forces that create an upside/ downside potential of economic performance.
Sensitivity Assessment - EthylenePrice drivers (Up or Down) all else being constant for each variable:
Price drivers down
Price drivers up
© 2016 IHS Markit
October 2016
Business Case 3Scenario: Expansion & investment decisions
I need to understand how the capacity additions are changing trade flow? Who will be displaced? What will be the resulting country/ regional operating rates, supply-demand balances, and price performance?
Approach: New capacity affects country and regional operating rates as well trade flow. The new World Analysis provides granular trade grids that reflect regional trade flows as well as nominally 80 countries of source to destination trade volumes (depending on relevance to specific chemical).
The magnitude and direction of trade flows indicate the influence on domestic market prices. Changes in trade flows, for example moving from a net importing position to a net exporting position or changes in final destination of the incremental product, provide an early indication of relative price performance of a domestic market via pressures such as export netback pricing or import equivalency pricing. The assessment of current and forecast operating rates and origin-to-destination of trade provide detailed understanding of the impacts of last increments of supply on domestic and export markets.
As a business manager, you can determine target markets as new industry capacity is added and assess financial performance of these markets as operating rates and trade change.
Business Case 4Scenario: Market channel planning and supply chain optimization
I need real time understanding of new capacity additions in terms of quantity and timing. What is the nature of the competitive playing field, the effect on operating rates, and the overall financial performance of a chemical product?
Approach: The World Analysis service now provides changes in capacity that are updated in real time and available to clients in a capacity database reflecting the latest view on actual start-up expectations.
Optimize your supply chain or marketing channel by viewing sources of existing and new capacity as well as location of critical demand centers. The forecast outlook on changes in capacity, demand, and trade inform the decision-maker for company decision-making in the context of forward industry trends.
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About IHS Markit
IHS Markit (Nasdaq: INFO) is a world leader in critical information, analytics and solutions for the major industries and markets that drive economies worldwide. The company delivers next-generation information, analytics and solutions to customers in business, finance and government, improving their operational efficiency and providing deep insights that lead to well-informed, confident decisions. IHS Markit has more than 50,000 key business and government customers, including 85 percent of the Fortune Global 500 and the world’s leading financial institutions. Headquartered in London, IHS Markit is committed to sustainable, profitable growth.
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For more information, visit www.ihs.com/thenewWA
