Chemical sector, Ciech this out!
According to company spokesperson Jarosław Mikowski, the bourse debut is aimed at funding Ciech's desire to further assert itself on the lucrative fertilizer market. Consequently, Ciech plans to invest the money raised in purchasing Police SA, currently the leading domestic producer of complex fertilizers. And this acquisition, following in the wake of Ciech's earlier purchase of fertilizer firm GZNF, should make Ciech the "biggest player on the fertilizer market in Poland," Mikowski claims. And such a move into fertilizers marks a new direction for the firm, which has been most closely associated with soda ash, a substance used in the production of glass, detergents and water treatment chemicals.
As for the condition of the fertilizer market, Halina Papis of the Agricultural Market Agency in Poland, points out that the financial condition of Polish farmers is still rather bleak, raising questions about the marketability of Ciech's new products.
However, when asked whether or not he believed domestic farmers would be able to afford Ciech fertilizers, Mikowski answered "Why not?" And such confidence can be easily attributed to the fact Ciech seeks to sell its products abroad rather than risk going after the local market.
Regardless of the outcome of the new venture, though, Ciech is still well placed in terms of soda ash. In fact, the firm enjoys a domestic production monopoly.
Brunner Mond, a company Ciech cites as one of its top global competitors, affirms through spokesperson Mark Chitty that Ciech has a strong hold on the market and is the third-largest producer of soda ash in Europe as a whole, ranking below only Solvey and Brunner Mond itself.
This will no doubt come as comforting news to potential Ciech shareholders in the upcoming flotation, as Chitty stresses that the demand for soda ash is relatively inelastic. Indeed, the market has been growing at a steady rate of one percent per year, suggesting that any big player in the market is assured a level of security that can be found in few other markets.
As for the condition of the fertilizer market, Halina Papis of the Agricultural Market Agency in Poland, points out that the financial condition of Polish farmers is still rather bleak, raising questions about the marketability of Ciech's new products.
However, when asked whether or not he believed domestic farmers would be able to afford Ciech fertilizers, Mikowski answered "Why not?" And such confidence can be easily attributed to the fact Ciech seeks to sell its products abroad rather than risk going after the local market.
Regardless of the outcome of the new venture, though, Ciech is still well placed in terms of soda ash. In fact, the firm enjoys a domestic production monopoly.
Brunner Mond, a company Ciech cites as one of its top global competitors, affirms through spokesperson Mark Chitty that Ciech has a strong hold on the market and is the third-largest producer of soda ash in Europe as a whole, ranking below only Solvey and Brunner Mond itself.
This will no doubt come as comforting news to potential Ciech shareholders in the upcoming flotation, as Chitty stresses that the demand for soda ash is relatively inelastic. Indeed, the market has been growing at a steady rate of one percent per year, suggesting that any big player in the market is assured a level of security that can be found in few other markets.
