Brazilian chemicals manufacturer Produquímica forecasts revenues of 700mn reais (US$328mn) in 2008, a 55% increase on last year, the company's commercial director Franco Borsari told BNamericas.
The improvement is attributed to acquisitions the company has made throughout the year, including fertilizer producer Mix Micro.
In addition to the acquisitions, the company invested in R&D, amplifying its portfolio and sales, and increasing production capacity.
"We spent around 50mn reais on investments this year; we have increased Produquímica's capacity by approximately 50% to 700,000t/y," the executive said.
According to Borsari, Produquímica plans to continue growing and raise its share in the fertilizer, water treatment and industrial processes segments, which are the company's key markets.
Approximately 5% of Produquímica's revenues come from exports. "The company has an important business in South America, including Paraguay, Uruguay, Argentina, Chile and Colombia," Borsari said. Around 30% of the company's exports go to South America, but Produquímica also exports to Europe, Africa and Asia.
Fertilizers and agribusiness correspond to 75% of the company's income. "This segment needs a lot of investments. The market has stagnated in Brazil due to the lack of credit," Borsari said.
"The agriculture sector needs financing, especially in the current environment. The government has taken steps to stimulate this sector and increase the resources available to producers," the executive said. According to Borsari, Produquímica's products are also focused on helping increase productivity in this sector.
As a result of the abrupt local currency depreciation, the company has raised prices by around 10%, since Produquímica imports a considerable amount of its raw materials.
"It's easier to work when the weakening or strengthening of our currency is gradual, but with depreciation of 30-40% in a short period of time, the adjustments are immediate," Borsari said, adding that it is not a general increase, because there are other factors to take into account, including raw material and commodities prices.
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