Showing posts with label Argentina. Show all posts
Showing posts with label Argentina. Show all posts

Browse the complete Report on: Argentina Information Technology Report Q3 2010
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Argentina’s IT spending is forecast by BMI to grow at a compound annual growth rate (CAGR) of 13% over 2010-2014, with spending picking up in 2010 after a contraction in 2009. The IT market is expected to grow by around 10% in 2010. The consumer notebook segment should again be a growth area, thanks to tax concessions and lower prices.
The Argentine IT market is the second largest in Latin America. Despite the current economic crisis, the total value of spending on IT products and services should pass US$3.8bn in 2010 and approach US$6.2bn by 2014. Per capita IT spend is seen as rising from US$94 in 2010 to US$147 in 2014 as the market approaches levels last seen before the crisis of 2001. The market is dominated by the capital Buenos Aires, which accounts for 26% of household appliance sales, including computer hardware.
In 2010, government spending should be a growth area, after a quiet 2009 for government hardware tenders, with particular opportunities in the education sector. Key prospects for enterprise resource planning (ERP) implementations and systems upgrades will include companies focused on regional expansion and export-oriented industries.
Industry Developments
In April 2010, the Argentine government was preparing to launch a tender to provide 3mn PCs to public schools nationwide. The programme, called Conectar Ingualdad, was announced by President Cristina Fernández. The tender will be run through state social security agency ANSES, with the 3mn PCs due to be distributed in early 2011.
In October 2009, Argentina’s senate approved a controversial bill aimed at imposing new taxes on luxury items, including electronics products. The law doubled value added tax (VAT) on affected goods from 10.5% to 21%. However, after industry lobbying, notebooks and netbooks were excluded from the proposed tax. The government said that the intention behind the proposed tax hikes was to provide assistance to the electronics manufacturing hub of Tierra del Fuego.
Competitive Landscape
A previous PC tender, launched in August 2009, resulted in telecoms company Movistar winning the contract to supply 250,000 of Intel’s Classmate PCs to technical schools nationwide. A total of 13 companies bid for that contact, with Chinese giant Lenovo and a number of other vendors also meeting the technical requirements. The final decision came down to price, with the ARS938 per unit price for the Intel PCs proving the winner.
SAP Argentina, the leader in Argentina’s enterprise applications segment with around a 50% share, has said that its multi-country Latin American unit was on track to increase its market share in 2010. In H110, the company recorded a number of significant wins in the Argentine market, indicating that business confidence had strengthened. Anglo-Dutch consumer products giant Unilever adopted an SAP solution for its Latin American operations and said that it expected a return-on-investment (ROI) of US$1mn within 2.7 years.
A major area of opportunity for IT services vendors will be public and private sector organisation demand for help to utilise cloud computing solutions. Software giant SAP has formed an alliance with IBM, Linux systems integrator Red Hat and Argentine telecoms company Metrotel to offer hosted solutions in Argentina. Government is expected to be a key vertical and, in June 2010, Japanese giant NEC announced the launch of a cloud computing base general education system for the Ministry of Education in Argentina’s San Juan province.
Computer Sales
BMI projects that Argentina’s computer and accessories market will have a CAGR of around 11% over 2010-2014, reaching around US$3.1bn by 2014. Argentine sales of computer hardware are forecast to return to positive growth in 2010, as growing affordability combined with more credit options and tax concessions have driven sales. With PC penetration only around 24%, there is still plenty of growth potential and penetration is expected to rise to at least 28% by 2014. Going forward, drivers include affordable PC programmes for households and schools, as well as growing broadband penetration, retail channel expansion and the popularity of notebooks and netbooks.
Software Argentina’s software market is projected to be worth US$662mn in 2010 and software CAGR for 2010- 2014 is forecast at around 14%, despite the economic climate and high annual software piracy losses. This year should see a boost from systems upgrades deferred from 2009, when the economic crisis had an impact in public and private sectors.
Demand from small and medium-sized enterprises (SMEs) for ERP applications should continue to grow, particularly in relatively untapped provincial areas. The main functional category currently remains ERP solutions, estimated to account for more than 80% of the enterprise software total. However, vendors will increasingly look to applications such as customer relationship management (CRM) and business intelligence, where faster growth is projected.
IT Services
Argentina’s IT services market is forecast at around US$1.1bn in 2010, with a return to double-digit growth after a sharp deceleration because of the economic contraction in 2009. For a developing market, the percentage of Argentine IT market revenues generated by services is fairly typical at around 25%, although lower than some other countries in the region where the services share is already above 30%.
IT services revenues are expected to grow faster than the market as a whole, with CAGR for 2010-2014 projected at about 14%. Led by the financial, telecoms and public sectors, there is a trend towards bigger managed service and outsourcing deals in key sectors of the local market. However, traditional services such as desktop support are still the mainstay.
E-Readiness
Argentina has one of the most dynamic telecoms markets in the region, with a dramatic expansion in the number of mobile subscribers in the past few years. Fixed-line penetration is among the highest in Latin America, providing a good platform for strong growth in broadband services adoption.

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Original Source : – Information Technology Market
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Browse the complete Report on:  Argentina Insurance Report Q4 2010

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Writing in July 2010, we have been able to include the final figures for the 12 months to June 2009 (the financial year for the Argentine insurance sector). We have also based our forecasts for 2010 on the actual figures for the 10 months to the end of April 2010 that have been published by the regulator, Superintendencia de Seguros de la Nación (SSN). According to the regulator, total insurance premiums in the year up to June 2009 amounted to ARS27,611mn. This included non-life premiums of ARS21,974mn. Life and retirement savings premiums combined amounted to ARS5,637mn. By June 2014, we expect that the corresponding figures will be ARS57,297mn, ARS46,570mn and ARS10,727mn. Underpinning our forecasts is a drop in non-life penetration from 1.63% in the June 2009 year to 1.38% in the June 2014 year. We expect that life density will rise from US$38 per capita to US$55.
BMI’s proprietary Insurance Business Environment Rating for Argentina (IBER) is 51.4 out of 100. In absolute and local currency terms, Argentina’s non-life segment has almost trebled in size since the end of 2005. Meanwhile, the life segment has grown by less than one-third. Given Argentina’s history of financial instability and the hugely controversial nationalisation of the private pension funds in late 2008 it is perhaps not surprising that the perennially under-developed life segment has lagged behind. Nevertheless, life premiums grew by 25% in 2007 and a very respectable 15% in 2008, in peso terms.
However, growth of life insurance stopped in 2009. In January 2010 the latest figures from the SSN indicated that gross written premiums in the life segment over the 12 months to the end of November 2009 were ARS5,445mn. In terms of gross written premiums, it appears that the life segment shrank by around 15% in 2008 in local currency terms and by more in US dollar terms. Meanwhile, the non-life segment continues to grow apace. The SSN’s figures indicated that non-life premiums in the 12 months to the end of November 2009 were ARS23,965mn. In other words, it appears that non-life premiums in 2009 were about 30% higher than they had been in 2008. The SSN’s latest figures for market shares (in relation to the year to June 30 2009) highlight three aspects of Argentina’s insurance sector. First, the overall market remains extraordinarily fragmented. La Caja (the local subsidiary of Generali) is the largest player in terms of total premiums, with an overall share of about 8.5%. Three other groups – Sancor, MAPFRE and Federación Patronal – each have market shares of between 6% and 8%, while HSBC La Buenos Aires, La Segunda, La Meridional, Provincia Seguros, Zurich and San Cristóbal each have market shares of between 3% and 5%.


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Original Source : – Argentina Insurance Report Q4 2010
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Browse the complete Report onArgentina Shipping Report Q4 2010
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Going into the second half of 2010 it was evident that the moderate recovery experienced by Argentina's shipping and ports industry was not risk-free. The threat of a blanket strike by one of Argentina's major grain worker unions in mid-June was the latest controversy facing the sector as it sought to regain momentum after 2009's downturn. Ports had been hit by a series of disputes over the preceding months, making Argentina one of the most volatile spots for freight transport operations in the Latin America region. Workers were threatening to block shipments of grains and oilseeds at export facilities unless their wage demands were met. According to the union, wages have failed to keep track with the recent surge in sales made by Argentine exporters on the back of 2009/10's bumper grains harvest. Argentina has emerged as a trouble spot from a freight transport/shipping perspective, owing to an increasing number of disruptions to port throughput, road haulage and other areas of the supply chain.
While the current economic recovery, bigger agricultural harvests and rising LNG tanker demand are positives, the road ahead contains many uncertainties. Since the difficulties of last year, the government of President Cristina Fernández has regained some of its lost popularity through deficit spending, but the money will eventually run out and a necessarily painful fiscal tightening cannot be postponed forever. Analysts believe the crunch moment may come either just before or just after the 2011 presidential elections. After a sharp deceleration in GDP growth last year to 1.0%, this year we predict a recovery of 4.3%, falling to 2.3% growth in 2011. However, BMI believes that the average annual growth rate over the next five years will be a disappointing 2.0%. To this rather sombre outlook must be added quite high levels of political risk, with high inflation fuelling industrial unrest and potential protests as the election campaign begins to take shape.
After slumping by 32.5% in 2009, this year we are predicting that tonnage volume at the Port of Buenos Aires will edge upwards by 3.7% to 8.915mn tonnes. In the medium term, we see moderate growth, averaging 4.7% to 2014 - this will, however, be twice the rate of growth of the Argentine economy. At the Port of Bahia Blanca (POBB), the tonnage downturn was spread over two years (2008 and 2009) and was less severe than in Buenos Aires. But the recovery here too will be a rather tepid affair, with tonnage set to grow by 2.9% this year to 11.304mn tonnes, and average annual growth between 2010 and 2014 projected at 3.2%.
In the container sector, we predict Buenos Aires container movements to rise by 3.4% to 940,252 TEUs, and to achieve average annual growth of 4.6%, between 2010 and 2014. At Bahia Blanca, container handling has grown steadily in the last few years from a very low base and there was no 2009 downturn. This year, we are predicting a 46.4% surge to 67,121 TEUs. Thereafter, however, medium-term average annual growth should stabilise in the high single percentage figures. Including 2010, the five-year average will be 16.0%.
Argentina's total trade (imports + exports) fell by 13.3% in 2009, with imports dropping proportionately by the greatest amount. This year, we see a modest recovery, with the combined total up by 3.6%. In the medium term to 2014, exports will grow by 5.0% per annum, imports will lag a little with growth of 4.2%, and the average for all trade will be 4.6%, lower than what has been experienced in recent years. The risks to our Argentina shipping and port projections are on the downside. The main risk is that the current government's pre-election 'borrow and spend' strategy will come unstuck, unleashing a financial crisis at some point before next year's presidential elections; such a crisis would inevitably lead to lower growth or an outright 'double dip' recession which would hit trade and freight demand.
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ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.
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Original Source : – Argentina Shipping Market
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Browse the complete Report on: Argentina Freight Transport Report Q4 2010
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Q310 saw a major development in the advancement of Argentina's freight transport sector. The government announced in July that it had secured a US$20bn credit agreement with the China Development Bank to carry out much-needed repair and modernisation work on the country's much maligned railway network after a state visit paid by President Cristina Kirchner to Beijing.

After several years of inaction, the pleas of farmers for a better rail freight network appear finally to have been answered: the first chunk of funding, worth a reported US$2.5bn, expected to be invested in improving the two main rail lines dissecting Argentina's north and central regions, which comprise the country's main areas of agricultural and mineral production. The renovations are expected to take place over a period of four years. An additional US$1.85bn will be spent on developing the Belgrano railway, which links Buenos Aires with the country's northern provinces and reaches as far as the Bolivian border. The destination of the remaining funds has yet to be decided, though it is expected to include modernisation of the underground rail services of Argentina's two largest cities, Buenos Aires and Cordoba.

BMI believes investment in Argentina's rail freight sector will help iron out the kinks in the country's supply chain and increase its competitiveness as a major exporter of grains and other raw materials. According to the Rosario grain exchange, the freight tonne-km cost of transporting grain by road is US$0.7 per dollar, about twice the price of transporting by rail or four times the cost of maritime freight. A cheaper, more efficient supply chain should put Argentine producers on a more even footing with other major suppliers such as the US and Canada.

With a brighter long-term outlook assured, the immediate forecast for Argentine rail freight is also positive. In 2010, we expect freight carried by rail to rebound by 1.45% to 10.06bntkm, while the total tonnage carried by rail will gain 1.45% to 19.9mn tonnes. We expect this performance to continue into 2011 when freight carried will grow to 10.23bntkm and total tonnage will increase to 20.29mn tonnes. Argentina's major ports meanwhile remain on course to complete a moderate recovery in 2010 as forecast by BMI at the beginning of the year. At the Port of Buenos Aires (POBA), we are sticking with our forecast of a modest 3.7% rebound in total tonnage throughput rebound in 2010 with cargo volumes set to reach 8.92mn tonnes. We expect the rate of growth to accelerate slightly in 2011 when throughput should grow by 4.7% to 9.34mn tonnes. We see the Port of Bahía Blanca (POBB)'s total tonnage growing by 2.9% to 11.3mn tonnes in 2010 before accelerating to 3% next year when the facility is projected to handle 11.65mn tonnes.

Though relations between the government and Argentina's agricultural producers have appeared more stable in 2010 relative to the turmoil of 2008 and 2009, ongoing disputes between the two parties, including port blockades by the URGARA farmers union in June continue to place downside risk to our trade forecasts. Added to this has been a Chinese ban on Argentine soy oil which has dragged on since March, following the escalation of a trade dispute between the two countries. That said, we continue to see imports gaining 18.8% in value in 2010 to US$81.2bn, while exports will gain 21.7% to US$108.2bn. In real terms, import growth will be a much more modest 2% this year, with exports doing significantly better at 5%. Looking to 2011, we expected the country's trade volumes to accelerate slightly with imports and exports growing by 4% and 5% respectively in real terms.
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ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.
 Contact:
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Original Source : – Argentina Freight Transport Report Q4 2010
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Browse the complete Report on: Argentina Pharmaceuticals and Healthcare Report Q4 2010
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The value of Argentina’s pharmaceutical market is calculated to have reached ARS12.64bn (US$3.37bn) in 2009. Through to 2014, we forecast a compound annual growth rate (CAGR) of 14.36% and 9.78% in local currency and US dollar terms, with the market value topping ARS24.72bn (US$5.37bn). The increased usage of generics and volume changes are expected to be the key drivers of market growth, with patented medicines’ share of the total market by value dropping from 56.5% in 2009 to 47.7% in 2014. In regional terms, Argentina remains the seventh most attractive market in the Americas region, with drawbacks including its challenging intellectual property (IP) and pharmaceutical pricing and procurement environments, not to mention the wider economic and political uncertainties.
Despite this, the reduced opportunities and continuing challenges facing pharmaceutical companies in developed global markets are increasingly resulting in acquisition activities in emerging markets. To this end, in June 2010, UK-based major GlaxoSmithKline (GSK) acquired Argentina's Laboratorios Phoenix in a move emphasising the company's aim of increasing its market share of pharmaceutical sectors in developing countries.
The US$253mn cash transaction, the latest in a string of deals in developing markets (GSK also acquired 9.9% stake in South Korea's Dong-A Pharmaceuticals recently), will also enable GSK to expand its regional revenues, as the local drugmaker is among the top ten nationally and is also one of the leading indigenous medicine exporters.
However, local players are also concerned over low levels of achievable profitability and threats this poses to their survival. They expected drug prices to increase by 14.5% during 2010, which is over ten percentage points below the government's forecast of cumulative inflation. Nevertheless, volume consumption of medicines in Argentina has increased significantly over the past decade, which should – to a degree – compensate for the gap between pharmaceutical and general consumer price rises.
On a wider political and economic front – and although we have recently upwardly revised GDP growth for 2010 – we expect the upcoming 2011 elections to be a key factor in shaping the wider economic landscape. While we do not see a reduction in public spending by the administration of President Cristina Fernández ahead of the election – in which her husband, Néstor Kirchner, is widely tipped to be a candidate – options to sustain such loose fiscal policy are fast running out. Having exhausted most of the domestic funding options, the Argentine government is now hoping to return to international capital markets for the first time since the notorious government default in 2001. Overall, Argentina remains a prime example of one of our core regional views, namely that those countries with elevated political risk profiles – especially in the form of prolonged economic mismanagement – are set to underperform their more business-friendly regional peers over the medium term.
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ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.
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Original Source : – Argentina Pharmaceuticals Healthcare Market
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Browse the complete Report on : Argentina Infrastructure Report Q4 2010

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The main developments in Argentina over the last quarter have been centred on utilities. The Inter- American Development Bank (IADB) approved a 25-year, US$300mn loan to fund a power transmission project in the country (December 2009). The loan will be used for completing the deployment of the 1,220km-long Norte Grande power transmission line. Earlier, in November, President Cristina Fernández, and the Brazilian president (Luiz Inácio Lula da Silva) entered into an agreement to form a joint venture for the construction of the Garabí dam. The hydro-electric project, with an installed capacity of 2.3GW, will be constructed on the Uruguay river.
The country's construction industry remains mired by the ongoing economic downturn. Construction activity in the country fell by 3.4% year-on-year (y-o-y) in November 2009, according to the national statistics agency, Indec. On a seasonally adjusted basis, meanwhile, construction was showed to be down by 0.5% y-o-y. There is no change to our core forecasts for Argentina’s construction industry for the second consecutive quarter. BMI estimates a contraction in the real value of the construction industry of 3.4% in 2009. We also continue to expect an even deeper contraction in 2010, owing to the structurally weak condition of Argentina’s economy and concerns about the viability of the government’s spending plans. Indeed, we anticipate a further downward plunge in real construction sector output in 2010, with - 5.3% growth forecast.
Argentina scores in the low to medium range in our Business Environment ratings, with an overall score of 47.1 out of 100. Four countries score higher in our index (Chile, Colombia, Brazil and Mexico), while only three countries are rated below Argentina. Argentina’s overall score is let down by significant constraints on the Limits to Potential Returns (for which it scores 41.7 out of 100), while it does moderately better (in absolute, but not relative terms) in Risks to the Realisation of Returns – where it scores 59.6 out of 100.
Overall, Argentina scores reasonably well for its Project Finance Ratings, sitting in third place in the region, with a score of 57.9 out of 100, behind Peru and Chile. The Commissioning and Operating rating helps to haul up the overall score, especially on a relative basis, as other countries in the region generally fare poorly for this category. However, the country is let down by some very low scores for the Design & Construction phase, particularly in terms of Inputs and Legal and Regulatory risks, with the current government having shown some worrying policy predilections.

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ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.

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Browse the complete Report on: Argentina Autos Report Q4 2010

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In its latest Argentina report, BMI highlights some of the major internal and external risks that the country’s auto sector faces that we believe will play a dampen on the country’s ability to fully exploit its position as Brazil's largest trading partner.
From the point of view of production, we fear the fragmented nature of its auto supplier base and the uncertainty surrounding the future course of government policy will cost Argentina new investments from potential and existing carmakers. Meanwhile, on the demand side, the temporary increase in vehicle sales brought about by inflationary pressures and boost in public spending in preparation for the 2011 elections is making us sceptical about future demand vehicle potential in the country.
A sharp upward revision in our GDP growth forecast from 1.5% expected earlier to nearly 4.3% for 2010 and an impressive 40% year-on-year (y-o-y) growth in new vehicle sales, to 318,567 units, in H110, has prompted us to increase Argentina’s end of 2010 total sales expectations to nearly 625,000 units, up nearly 28.3% compared with last year. We expect this to be followed by another 9% y-o-y growth in 2011 as we expect the government to be keen on boosting consumer spending as much as possible in the run up to next year's parliamentary and presidential elections. Thereafter, however, the end of subsidies will mean that the market will struggle to maintain an average growth level between 5-6% y-o-y between 2012 and 2014, taking total sales to just under 815,000 units by the end of the forecast period.
Our total production forecast, on the other hand, has been slightly raised from almost 13% y-o-y to nearly 17% y-o-y, to 600,000 units, by the end of this year. However, in view of the aforementioned risks, we doubt whether this growth can be maintained. We therefore limit our forecast for Argentina’s annual production capacity to reach over 830,000 units by 2014.
The combined effect of these risks to Argentina’s growth has been that BMI expects the country, along with Venezuela, to be a significant underperformer in the region. Argentina currently occupies fourth position in our rankings with a score of only 55.1 points, compared with respective scores of 58.5 points and 57.8 points by Brazil and Mexico.
The top three carmakers, which saw their sales shrink significantly during 2009, recorded to robust recovery in their sales in H110. While Volkswagen and General Motors Company maintained their respective positions as the leading carmakers, followed by Renault as the third largest carmaker during H110, a slight underperformance by Ford Motor meant the US carmaker was pushed to the fourth during H110.

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ReportsandReports comprises an online library of 10,000 reports, in-depth market research studies of over 5000 micro markets, and 25 industry specific websites. Our client list boasts almost all well-known publishers of such reports across the globe. We as a third-party reseller of market research reports employ a number of marketing tools, such as press releases, email-marketing and effective search-engine optimization techniques to drive revenues for our clients. We also provide 24/7 online and offline support service to our customers.
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Browse the complete Report on: Argentina Oil and Gas Report Q4 2010




The latest Argentina Oil & Gas Report from BMI forecasts that the country will account for 6.09% of Latin America regional oil demand by 2014, while providing 6.31% of supply. Latin American regional oil use will average an estimated 7.76mn barrels per day (b/d) in 2010. It should rise to 7.91mn b/d in 2011 and reach 8.41mn b/d by 2014. Regional oil production in 2010 should average an estimated 10.05mn b/d. It is set to rise to 10.63mn b/d by 2014. Oil exports have been slipping, because demand growth has exceeded the pace of supply expansion. In 2001, the region was exporting an average 3.37mn b/d. This total will fall to an estimated 2.29mn b/d in 2010 and is forecast to slip further to 2.22mn b/d in 2014. The principal exporters will be Mexico, Venezuela, Ecuador and Brazil. 

In terms of natural gas, the region in 2010 will consume an estimated 209bn cubic metres (bcm), with demand of 252bcm targeted for 2014. Production of an estimated 221bcm in 2010 should reach 247bcm in 2014, and implies 5bcm of net imports at the end of the period. Argentina’s share of gas consumption in 2010 is an estimated 21.05%, while its share of production was 19.45%. By 2014, its share of gas consumption is forecast to be 19.65%, with the country accounting for 17.69% of supply. 

For 2010 as a whole, we continue to assume an average OPEC basket price of US$83.00/bbl, +36.4% year-on-year (y-o-y). Risk is now clearly on the downside, thanks to the slow progress made during June. However, a full year outturn in excess of US$80 remains a strong possibility and we see no need to review our assumptions at this point. The 2010 US WTI price is now put at US$87.63/bbl. BMI is assuming an OPEC basket price of US$85.00/bbl in 2011, with WTI averaging US$89.74. Our central assumption for 2012 and beyond is an OPEC price averaging US$90.00/bbl, delivering WTI at just over US$95.00. 

For 2010, the BMI assumption for premium unleaded gasoline is an average global price of US$95.45/bbl. The overall y-o-y rise in 2010 gasoline prices is put at 36%. Gasoil in 2010 is expected to average US$93.23/bbl. The full-year outturn represents a 35% increase from the 2009 level. For 2010, the annual jet price level is forecast to be US$95.90/bbl. This compares with US$70.66/bbl in 2009. The 2010 average naphtha price is put by BMI at US$83.53/bbl, up 41% from the previous year’s level. Argentina’s real GDP is forecast by BMI to rise by 1.5% in 2010, followed by average annual growth of 2.0% in 2010-2014. State entity Enarsa acts as partner to international oil companies (IOCs) in supporting output growth efforts, operating alongside regional heavyweight Repsol YPF and others. We are assuming oil production peaking at no more than 685,000b/d in 2013, with the country expected to pump 665,000b/d in 2010. Beyond the 2009/2010 dip, consumption is forecast to increase by around 1.5% per annum to 2014, implying demand of 512,000b/d by the end of the forecast period. The crude oil export capability would therefore be around 159,000b/d by 2014. Gas production is forecast to increase from an estimated 43bcm in 2010 to a high of 46bcm during the period, resulting in the need for 5.8bcm of net imports by 2014. 

Between 2010 and 2019, we are forecasting a decrease in Argentine oil production of 8.75%, with crude volumes peaking in 2013 at 685,000b/d, before falling steadily to 607,000b/d by the end of the 10-year forecast period. Oil consumption between 2010 and 2019 is set to increase by 13.21%, with growth slowing to an assumed 1% per annum towards the end of the period and the country using 541,000 b/d by 2019. Gas production is expected to rise gradually, from an estimated 43.0bcm in 2010 to a peak of 46.0bcm in 2012/2013, before slipping back to 33.8bcm by 2019. With demand growth of 24.13%, this provides a need for net imports to rise to 20.8bcm by 2019. Details of BMI’s 10-year forecasts can be found at the end of this report. 

Argentina now takes fourth place, behind Peru, in BMI’s composite Business Environment (BE) rating, which combines upstream and downstream scores. The country holds fifth place in our updated upstream Business Environment ratings, ahead of Trinidad & Tobago (T&T). Its gas resources, largely privatised oil sector, licensing regime and competitive landscape work in the country’s favour, but are undermined by an absence of growth potential, asset maturity and unappealing risk environment. Limited scope exists for Argentina to pull further away from Trinidad, but it should be safe from Ecuador some eight points below. Argentina is well up the league table in BMI’s downstream Business Environment ratings, reflecting its privatised refining and marketing segment, substantial capacity and competitive environment, offset by only moderate growth potential and a relatively high level of retail site intensity. It now holds third place, behind Colombia, in the regional rankings.

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