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VOLUME XXI
September 14, 2023
Everchem’s exclusive Closers Only Club is reserved for only the highest caliber brass-baller salesmen in the chemical industry. Watch the hype video and be introduced to the top of the league: — read more
October 20, 2022
C&EN’s Global Top 50 chemical firms for 2022
The world’s chemical industry has recovered from the COVID-19 pandemic and is now riding the wave of higher prices
by Alexander H. Tullo
The world’s chemical industry didn’t just grow in 2021, it positively swelled.
According to C&EN’s latest Global Top 50 survey, the world’s 50 largest chemical companies, in aggregate, posted sales of $1.1 trillion in 2021, the fiscal year that forms the basis of the ranking. That’s a 38% increase over the combined total for the same 50 firms in 2020.
Profits more than kept up. Chemical operating income for the 41 firms that break out such numbers jumped 148% in 2021, hitting $127 billion.
There are two big reasons for the spike in chemical sales and earnings in 2021. First, the world’s economy sagged in 2020 on account of the COVID-19 pandemic. This downturn hit the chemical industry, albeit not as severely as it did industries like aerospace and automotive. The 50 firms that appeared a year ago in C&EN’s survey posted a 7% decline in sales. And they posted earnings declines for the second year in a row. With the world economy recovering in 2021, it stands to reason that chemical sales recovered as well.
Also related to the spike is inflation, the likes of which some countries around the world haven’t seen in decades. According to the Energy Information Administration, the US benchmark oil price rose from $47.07 per barrel in December 2020 to $71.69 a year later.
The chemical industry, most of which relies on oil as a raw material, responded by raising prices in kind. According to LyondellBasell Industries, US and European ethylene prices increased by 35% and 60%, respectively, in 2021, while polyethylene prices rose about 45%. Prices for ammonia more than doubled.
Thus, the healthiest sales increases seen in the Global Top 50 came from petrochemical companies. Sabic, Formosa Plastics, PetroChina, LyondellBasell Industries, and ExxonMobil Chemical all clocked in with sales increases of 40% or more. Also riding the crest of the commodity price wave are fertilizer makers such as Yara, Nutrien, and Mosaic, which posted astounding increases in sales.
1 BASF
2021 chemical sales: $93.0 billion
For the third consecutive year, BASF heads the Global Top 50. Because it has a home base in Germany, the company was strongly impacted by Russia’s invasion of Ukraine. BASF pledged in April to wind down operations in Russia and Belarus, which represent about 1% of its sales. The company says it will continue supplying agrochemicals to these countries to avoid disrupting the world’s delicate food supply chain. BASF has also been affected by the severe increase in European natural gas prices that the war has exacerbated. In March, BASF chairman Martin Brudermüller told a Houston audience at the IHS Markit World Petrochemical Conference that “European industry really has to rethink” its strategy, given its dependence on natural gas from Russia. The war has also affected the company’s Wintershall Dea energy joint venture, which has extensive operations in Russia. During the first quarter, BASF took a $1.2 billion write-off related to the cancellation of Nord Stream 2, a natural gas pipeline between Germany and Russia that Wintershall helped finance. BASF is also anticipating the coming energy transition. The company is carving out its emission catalyst business, which it acquired with its 2006 purchase of Engelhard. The move is a response to the dim outlook for internal combustion engine vehicles and could be a prelude to a sale. BASF has simultaneously been trying to grow as a producer of materials for electric vehicle batteries and aims to spend $5 billion on production capacity outside Europe.
Credit: BASF
Mixed metal oxide cathode materials being prepared at BASF
3 Dow
2021 chemical sales: $55.0 billion
In 2020, Dow revealed its aspiration to reach carbon emission neutrality by 2050, and at an investor event in October, it detailed its plans to get there. The company aims to spend $1 billion per year, about a third of its capital budget, to decarbonize its petrochemical sites around the world one by one. Topping that list is Fort Saskatchewan, Alberta, where in an industry first, the company will build a carbon-neutral ethylene cracker. An autothermal reformer will process the cracker’s off-gases to generate hydrogen that will be burned in the cracker’s furnaces instead of natural gas. Dow will capture the resulting carbon dioxide and inject it into Alberta’s CO2 pipeline for sequestration. Dow’s sustainability push extends beyond greenhouse gases and into plastic waste. At the October event, for example, the company said it would collaborate with Fuenix Ecogy to build a waste plastics pyrolysis plant in the Netherlands.
9 LyondellBasell Industries
2021 chemical sales: $39.0 billion
Some chemical companies have been ditching commodities to focus on specialties. LyondellBasell Industries is exiting refining so it can better home in on commodities. In April, the company said it would shutter its 100-year-old Houston refinery by the end of 2023. The refinery, part of LyondellBasell Industries since it spun off from Atlantic Richfield in 1989, has long been an issue for the company. It was a joint venture with the Venezuelan state oil company PDVSA for more than a decade before Lyondell bought out its partner for $2.1 billion in 2006. Company officials say they may repurpose the property for sustainability projects such as a plastics pyrolysis plant. Meanwhile, LyondellBasell has been steadily growing its commodity chemical business. It bought 50% stakes in ethylene complexes in the US and China. And according to newly surfaced government documents, it is considering building a high-density polyethylene plant in Corpus Christi, Texas.
17 Wanhua Chemical
2021 chemical sales: $22.6 billion
The Chinese polyurethane and petrochemical maker has been rocketing up the Global Top 50 because of its prodigious growth in recent years. And 2021 was another enormous year for Wanhua Chemical—its revenues nearly doubled from 2020. Ambitious capital expansion projects have helped fuel the growth. In Yantai, China, it opened an ethylene cracker and derivatives plants and revamped methylene diphenyl diisocyanate production. In April, the company announced it would spend $3.6 billion to build a chemical complex in Penglai, China. The project, to be completed in 2024, will feature a propane dehydrogenation unit as well as downstream plants for polypropylene, propylene oxide, and other chemicals. The company also started producing cathode materials and the biodegradable polymer poly(butylene adipate-co-terephthalate).
21 Covestro
2021 chemical sales: $18.8 billion
The polyurethane specialist Covestro unveiled a plan late last year to cut up to 1,700 jobs—about 10% of its workforce—by the end of 2023. Most of the cuts will be in Germany. At the same time, the company is resuscitating a plan to build a world-scale methylene diphenyl diisocyanate plant by 2026. While the previous plan pinpointed Texas as the site of the complex, Covestro now says it may build it in either the US or China. The company is also increasing capacity for another polyurethane raw material, toluene diisocyanate, in Dormagen, Germany. And with the biotechnology firm Genomatica, Covestro plans to make biobased hexamethylenediamine, used in the manufacture of polyurethanes and nylon 6,6.
Credit: Covestro
Covestro technician Mario Lopes works at the pilot plant where the company is producing biobased hexamethylenediamine.
23 Evonik Industries
2021 chemical sales: $17.7 billion
Evonik Industries is yet another major chemical maker planning a portfolio transformation. The German company intends to divest its performance material businesses by the end of 2023. These commodities, such as C4 chemicals, isononyl alcohol, and superabsorbent polymers, generate about 20% of the firm’s sales. Evonik had been considering a sale of superabsorbents—used in diapers and similar applications—since late 2020. At the same time, the firm plans to invest $3.2 billion in sustainable businesses. Separately, in June, Evonik announced it would build a $220 million plant in Lafayette, Indiana, for lipids used in messenger RNA applications like COVID-19 vaccines. The company has been supplying this burgeoning market from facilities in Germany. Evonik is also building a plant to make rhamnolipids, a class of biobased surfactants, in Slovakia.
24 Shell
2021 chemical sales: $17.0 billion
Later this year, Shell will open an ethylene and polyethylene complex in Monaca, Pennsylvania. The facility was the only one among a wave of new US ethylene crackers to be situated far from the Gulf Coast. The project took a long time. It was announced a decade ago, and construction began in 2017. It may be Shell’s last conventional ethylene project for a while. The company is collaborating with Dow to electrify the steam cracking process. The partners recently started an experimental unit in Amsterdam to test designs that could replace current natural gas–fired cracker furnaces. They want to build a large pilot plant by 2025. And at a recent conference, Shell officials said the company is running feedstocks based on biomass and plastic pyrolysis oil through its ethylene complex in Norco, Louisiana. The company intends to process 180,000 metric tons (t) of the alternative feedstocks by 2023 and to ramp up use to 600,000 t in 3–5 years.
30 Indorama Ventures
2021 chemical sales: $14.6 billion
The Thai polyester maker Indorama Ventures made another big acquisition to diversify its business earlier this year when it bought the ethoxylated surfactant maker Oxiteno from the Brazilian conglomerate Ultrapar Participações for $1.3 billion. Oxiteno has about $1 billion in annual sales. In 2020, Indorama bought Huntsman’s US-based surfactant unit, its first big move into surfactants. Indorama, already a big mechanical recycler of polyethylene terephthalate (PET), is plunging into the chemical recycling of plastics. It plans to build a plant in Longlaville, France, that will depolymerize PET using an enzymatic process from the start-up Carbios. The facility will be close to an Indorama PET plant.
37 Arkema
2021 chemical sales: $11.3 billion
Over the past year, Arkema has placed a lot of emphasis on one of its core businesses, adhesives, as well as on an emerging business, battery materials. The French specialty chemical maker bought Ashland’s adhesives business in February for $1.65 billion. The business has $360 million in annual sales of water-based polyurethane wood glues and acrylic, pressure-sensitive adhesives for packaging labels and other applications. In 2015, Arkema bought the adhesives maker Bostik from Total for $2.2 billion. With Nippon Shokubai, Arkema is studying the feasibility of producing lithium bis(fluorosulfonyl)imide electrolyte salts, used in next-generation batteries, in France. Arkema’s goal is to have sales to the battery market of at least $1 billion per year by 2030. To that end, it is also expanding capacity for poly(vinylidene fluoride) in Pierre-Bénite, France. The polymer is used as a binder and separator material in lithium-ion batteries.
39 Hanwha Solutions
2021 chemical sales: $10.9 billion
In June, Hanwha Solutions detailed plans to reach net-zero carbon emissions by 2050. Some 70% of the carbon reduction at the South Korean chemical and solar material maker will come from using renewable energy. Replacing fossil fuels in its manufacturing processes with hydrogen will yield another 15%. The balance of cuts will come from better efficiency and carbon capture. The company is also making investments in sustainability. It helped lead a $21 million venture capital investment in Novoloop, a California-based start-up that is developing a technology to convert postconsumer polyethylene into thermoplastic polyurethanes and other chemicals.
49 Lanxess
2021 chemical sales: $8.9 billion
Lanxess is planning a likely exit from the polymer business. The German company and the private equity firm Advent International formed a joint venture to buy DSM’s engineering polymer business—a producer of high-end nylon resins—for $4.1 billion. Lanxess is contributing its own business, which makes polybutylene terephthalate and nylon 6, to the partnership. It will own an up to 40% stake in the joint venture for 3 years, after which it will have an option to sell. At the same time, Lanxess is growing in specialty chemicals. Earlier this month, it completed the purchase of International Flavors & Fragrances’ microbial control business for about $1.3 billion. The business, which once belonged to Dow, makes glutaraldehyde biocides and isothiazolinone-based antimicrobials and has $450 million in annual sales.
Credit: Lanxess
A worker at a Lanxess polymer plant in Gastonia, North Carolina. The plant will become part of a joint venture with Advent International.
https://cen.acs.org/business/finance/CENs-Global-Top-50-2022/100/i26
October 20, 2022
C&EN’s Global Top 50 chemical firms for 2022
The world’s chemical industry has recovered from the COVID-19 pandemic and is now riding the wave of higher prices
by Alexander H. Tullo
The world’s chemical industry didn’t just grow in 2021, it positively swelled.
According to C&EN’s latest Global Top 50 survey, the world’s 50 largest chemical companies, in aggregate, posted sales of $1.1 trillion in 2021, the fiscal year that forms the basis of the ranking. That’s a 38% increase over the combined total for the same 50 firms in 2020.
Profits more than kept up. Chemical operating income for the 41 firms that break out such numbers jumped 148% in 2021, hitting $127 billion.
There are two big reasons for the spike in chemical sales and earnings in 2021. First, the world’s economy sagged in 2020 on account of the COVID-19 pandemic. This downturn hit the chemical industry, albeit not as severely as it did industries like aerospace and automotive. The 50 firms that appeared a year ago in C&EN’s survey posted a 7% decline in sales. And they posted earnings declines for the second year in a row. With the world economy recovering in 2021, it stands to reason that chemical sales recovered as well.
Also related to the spike is inflation, the likes of which some countries around the world haven’t seen in decades. According to the Energy Information Administration, the US benchmark oil price rose from $47.07 per barrel in December 2020 to $71.69 a year later.
The chemical industry, most of which relies on oil as a raw material, responded by raising prices in kind. According to LyondellBasell Industries, US and European ethylene prices increased by 35% and 60%, respectively, in 2021, while polyethylene prices rose about 45%. Prices for ammonia more than doubled.
Thus, the healthiest sales increases seen in the Global Top 50 came from petrochemical companies. Sabic, Formosa Plastics, PetroChina, LyondellBasell Industries, and ExxonMobil Chemical all clocked in with sales increases of 40% or more. Also riding the crest of the commodity price wave are fertilizer makers such as Yara, Nutrien, and Mosaic, which posted astounding increases in sales.
1 BASF
2021 chemical sales: $93.0 billion
For the third consecutive year, BASF heads the Global Top 50. Because it has a home base in Germany, the company was strongly impacted by Russia’s invasion of Ukraine. BASF pledged in April to wind down operations in Russia and Belarus, which represent about 1% of its sales. The company says it will continue supplying agrochemicals to these countries to avoid disrupting the world’s delicate food supply chain. BASF has also been affected by the severe increase in European natural gas prices that the war has exacerbated. In March, BASF chairman Martin Brudermüller told a Houston audience at the IHS Markit World Petrochemical Conference that “European industry really has to rethink” its strategy, given its dependence on natural gas from Russia. The war has also affected the company’s Wintershall Dea energy joint venture, which has extensive operations in Russia. During the first quarter, BASF took a $1.2 billion write-off related to the cancellation of Nord Stream 2, a natural gas pipeline between Germany and Russia that Wintershall helped finance. BASF is also anticipating the coming energy transition. The company is carving out its emission catalyst business, which it acquired with its 2006 purchase of Engelhard. The move is a response to the dim outlook for internal combustion engine vehicles and could be a prelude to a sale. BASF has simultaneously been trying to grow as a producer of materials for electric vehicle batteries and aims to spend $5 billion on production capacity outside Europe.
Credit: BASF
Mixed metal oxide cathode materials being prepared at BASF
3 Dow
2021 chemical sales: $55.0 billion
In 2020, Dow revealed its aspiration to reach carbon emission neutrality by 2050, and at an investor event in October, it detailed its plans to get there. The company aims to spend $1 billion per year, about a third of its capital budget, to decarbonize its petrochemical sites around the world one by one. Topping that list is Fort Saskatchewan, Alberta, where in an industry first, the company will build a carbon-neutral ethylene cracker. An autothermal reformer will process the cracker’s off-gases to generate hydrogen that will be burned in the cracker’s furnaces instead of natural gas. Dow will capture the resulting carbon dioxide and inject it into Alberta’s CO2 pipeline for sequestration. Dow’s sustainability push extends beyond greenhouse gases and into plastic waste. At the October event, for example, the company said it would collaborate with Fuenix Ecogy to build a waste plastics pyrolysis plant in the Netherlands.
9 LyondellBasell Industries
2021 chemical sales: $39.0 billion
Some chemical companies have been ditching commodities to focus on specialties. LyondellBasell Industries is exiting refining so it can better home in on commodities. In April, the company said it would shutter its 100-year-old Houston refinery by the end of 2023. The refinery, part of LyondellBasell Industries since it spun off from Atlantic Richfield in 1989, has long been an issue for the company. It was a joint venture with the Venezuelan state oil company PDVSA for more than a decade before Lyondell bought out its partner for $2.1 billion in 2006. Company officials say they may repurpose the property for sustainability projects such as a plastics pyrolysis plant. Meanwhile, LyondellBasell has been steadily growing its commodity chemical business. It bought 50% stakes in ethylene complexes in the US and China. And according to newly surfaced government documents, it is considering building a high-density polyethylene plant in Corpus Christi, Texas.
17 Wanhua Chemical
2021 chemical sales: $22.6 billion
The Chinese polyurethane and petrochemical maker has been rocketing up the Global Top 50 because of its prodigious growth in recent years. And 2021 was another enormous year for Wanhua Chemical—its revenues nearly doubled from 2020. Ambitious capital expansion projects have helped fuel the growth. In Yantai, China, it opened an ethylene cracker and derivatives plants and revamped methylene diphenyl diisocyanate production. In April, the company announced it would spend $3.6 billion to build a chemical complex in Penglai, China. The project, to be completed in 2024, will feature a propane dehydrogenation unit as well as downstream plants for polypropylene, propylene oxide, and other chemicals. The company also started producing cathode materials and the biodegradable polymer poly(butylene adipate-co-terephthalate).
21 Covestro
2021 chemical sales: $18.8 billion
The polyurethane specialist Covestro unveiled a plan late last year to cut up to 1,700 jobs—about 10% of its workforce—by the end of 2023. Most of the cuts will be in Germany. At the same time, the company is resuscitating a plan to build a world-scale methylene diphenyl diisocyanate plant by 2026. While the previous plan pinpointed Texas as the site of the complex, Covestro now says it may build it in either the US or China. The company is also increasing capacity for another polyurethane raw material, toluene diisocyanate, in Dormagen, Germany. And with the biotechnology firm Genomatica, Covestro plans to make biobased hexamethylenediamine, used in the manufacture of polyurethanes and nylon 6,6.
Credit: Covestro
Covestro technician Mario Lopes works at the pilot plant where the company is producing biobased hexamethylenediamine.
23 Evonik Industries
2021 chemical sales: $17.7 billion
Evonik Industries is yet another major chemical maker planning a portfolio transformation. The German company intends to divest its performance material businesses by the end of 2023. These commodities, such as C4 chemicals, isononyl alcohol, and superabsorbent polymers, generate about 20% of the firm’s sales. Evonik had been considering a sale of superabsorbents—used in diapers and similar applications—since late 2020. At the same time, the firm plans to invest $3.2 billion in sustainable businesses. Separately, in June, Evonik announced it would build a $220 million plant in Lafayette, Indiana, for lipids used in messenger RNA applications like COVID-19 vaccines. The company has been supplying this burgeoning market from facilities in Germany. Evonik is also building a plant to make rhamnolipids, a class of biobased surfactants, in Slovakia.
24 Shell
2021 chemical sales: $17.0 billion
Later this year, Shell will open an ethylene and polyethylene complex in Monaca, Pennsylvania. The facility was the only one among a wave of new US ethylene crackers to be situated far from the Gulf Coast. The project took a long time. It was announced a decade ago, and construction began in 2017. It may be Shell’s last conventional ethylene project for a while. The company is collaborating with Dow to electrify the steam cracking process. The partners recently started an experimental unit in Amsterdam to test designs that could replace current natural gas–fired cracker furnaces. They want to build a large pilot plant by 2025. And at a recent conference, Shell officials said the company is running feedstocks based on biomass and plastic pyrolysis oil through its ethylene complex in Norco, Louisiana. The company intends to process 180,000 metric tons (t) of the alternative feedstocks by 2023 and to ramp up use to 600,000 t in 3–5 years.
30 Indorama Ventures
2021 chemical sales: $14.6 billion
The Thai polyester maker Indorama Ventures made another big acquisition to diversify its business earlier this year when it bought the ethoxylated surfactant maker Oxiteno from the Brazilian conglomerate Ultrapar Participações for $1.3 billion. Oxiteno has about $1 billion in annual sales. In 2020, Indorama bought Huntsman’s US-based surfactant unit, its first big move into surfactants. Indorama, already a big mechanical recycler of polyethylene terephthalate (PET), is plunging into the chemical recycling of plastics. It plans to build a plant in Longlaville, France, that will depolymerize PET using an enzymatic process from the start-up Carbios. The facility will be close to an Indorama PET plant.
37 Arkema
2021 chemical sales: $11.3 billion
Over the past year, Arkema has placed a lot of emphasis on one of its core businesses, adhesives, as well as on an emerging business, battery materials. The French specialty chemical maker bought Ashland’s adhesives business in February for $1.65 billion. The business has $360 million in annual sales of water-based polyurethane wood glues and acrylic, pressure-sensitive adhesives for packaging labels and other applications. In 2015, Arkema bought the adhesives maker Bostik from Total for $2.2 billion. With Nippon Shokubai, Arkema is studying the feasibility of producing lithium bis(fluorosulfonyl)imide electrolyte salts, used in next-generation batteries, in France. Arkema’s goal is to have sales to the battery market of at least $1 billion per year by 2030. To that end, it is also expanding capacity for poly(vinylidene fluoride) in Pierre-Bénite, France. The polymer is used as a binder and separator material in lithium-ion batteries.
39 Hanwha Solutions
2021 chemical sales: $10.9 billion
In June, Hanwha Solutions detailed plans to reach net-zero carbon emissions by 2050. Some 70% of the carbon reduction at the South Korean chemical and solar material maker will come from using renewable energy. Replacing fossil fuels in its manufacturing processes with hydrogen will yield another 15%. The balance of cuts will come from better efficiency and carbon capture. The company is also making investments in sustainability. It helped lead a $21 million venture capital investment in Novoloop, a California-based start-up that is developing a technology to convert postconsumer polyethylene into thermoplastic polyurethanes and other chemicals.
49 Lanxess
2021 chemical sales: $8.9 billion
Lanxess is planning a likely exit from the polymer business. The German company and the private equity firm Advent International formed a joint venture to buy DSM’s engineering polymer business—a producer of high-end nylon resins—for $4.1 billion. Lanxess is contributing its own business, which makes polybutylene terephthalate and nylon 6, to the partnership. It will own an up to 40% stake in the joint venture for 3 years, after which it will have an option to sell. At the same time, Lanxess is growing in specialty chemicals. Earlier this month, it completed the purchase of International Flavors & Fragrances’ microbial control business for about $1.3 billion. The business, which once belonged to Dow, makes glutaraldehyde biocides and isothiazolinone-based antimicrobials and has $450 million in annual sales.
Credit: Lanxess
A worker at a Lanxess polymer plant in Gastonia, North Carolina. The plant will become part of a joint venture with Advent International.
https://cen.acs.org/business/finance/CENs-Global-Top-50-2022/100/i26
October 20, 2022
Container imports to Los Angeles and Long Beach are plummeting
Port of LA imports haven’t been this low in September since 2009
Greg Miller Follow on Twitter Wednesday, October 19, 2022
4 minutes read
Listen to this article
0:00 / 6:08BeyondWords
September is usually a strong month for West Coast imports as U.S. companies bring in their year-end holiday goods. Not so in 2022.
On Wednesday, the Port of Los Angeles reported its lowest import total for September since 2009, amid the Great Recession. The day before, the neighboring Port of Long Beach posted its weakest import total for September since 2016.
Imports to Southern California ports are falling fast because shippers have shifted volumes to East and Gulf coast ports, fearing disruptions from West Coast port labor negotiations. Simultaneously, volumes are now pulling back nationwide due to falling demand.
Holiday imports ‘dropped precipitously’
“In the month of September is where the real story lies,” explained Gene Seroka, executive director of the Port of Los Angeles, during a news conference on Wednesday.
Earlier this year, imports of durable goods bought heavily during the pandemic — furniture, appliances, etc. — began pulling back. In September, declines were heavily driven by reductions in holiday goods, as well.
“September is traditionally a high-volume month for end-of-year products,” said Seroka. “Think toys and games, clothing, footwear and other products. Those holiday gift items dropped precipitously compared to last September, mainly because they came in earlier. This year our peak season was in June and July, as savvy importers moved up the arrival of these goods to bring some certainty back to when they could get to market.”
Commenting on the shift to East and Gulf coast ports, Seroka said “concern over the dockworkers labor contract negotiations [was] a major factor contributing to volume declines.” He believes the shift “is likely to continue until a West Coast labor contract is in place — and that can’t happen soon enough.” The previous contract expired July 1.
Asked by American Shipper how October’s volumes are shaping up versus September’s, he said they will be “probably about the same or a little bit lighter. It’s going to be a soft October.”
LA September imports down 15% vs. August
The Port of Los Angeles reported total throughput of 709,873 twenty-foot equivalent units in September, down 21.5% year on year (y/y). Exports came in at 77,680 TEUS, up 2.6% y/y, while empties totaled 288,731 TEUs, down 19.8% y/y.
Loaded imports to Los Angeles totaled just 343,462 TEUs, down 26.6% y/y. Imports fell 15.1% sequentially versus August, following a 16.7% drop in August versus July.
Los Angeles’ imports reached their highest level this year in May. September imports were down 31.3% compared to that month. Imports in September were the lowest for any month since May 2020, when the U.S. was in the midst of COVID-19 lockdowns.
Long Beach September imports down 11% vs. August
The Port of Long Beach reported total throughput of 741,823 TEUs for September, down 0.9% y/y. Exports came in at 112,940 TEUs, up 1.9% y/y, and empties totaled 286,212 TEUs, up 7% y/y.
Long Beach handled 342,671 TEUs of imports in September, down 7.4% y/y and down 10.9% sequentially versus August. As in Los Angeles, Long Beach’s imports peaked this year in May. September was down 27.5% from that high. Monthly imports have not been this low since June 2020.
Port of Long Beach Executive Director Mario Cordero blamed the import decline on consumer and retail concerns about inflation, “leading to warehouses filled with inventory and fewer product orders from Asia.”
Fewer ships being worked at berths
The focus during the supply chain crisis was on the massive number of container ships at anchorages or loitering offshore as they waited for berths in Los Angeles or Long Beach. Statistics from the Marine Exchange of Southern California show a steep drop throughout this year, from a high of 109 waiting container ships Jan. 9 to just four on Wednesday, the lowest number since October 2020.
The Marine Exchange also collects data on the number of container ships at the berths in the two ports. This data also shows a major — and more recent — change.
As the supply crisis intensified, there were often over 30 ships at the two ports’ berths each day. Between August 2021 and February 2022, there were an average of 28.8 container vessels alongside in Los Angeles and Long Beach daily.
In recent weeks, however, the numbers have sunk to much lower levels. The average from Sept. 1 through Tuesday was 19 ships alongside, down over 30% from peak levels. There were 18 ships at the ports’ berths Tuesday. There were only 10 ships alongside on Sept. 12.
This is getting closer to pre-COVID levels. The average number of ships at the ports’ berths daily in full-year 2019 was 14.8.
Click for more articles by Greg Miller
October 20, 2022
Container imports to Los Angeles and Long Beach are plummeting
Port of LA imports haven’t been this low in September since 2009
Greg Miller Follow on Twitter Wednesday, October 19, 2022
4 minutes read
Listen to this article
0:00 / 6:08BeyondWords
September is usually a strong month for West Coast imports as U.S. companies bring in their year-end holiday goods. Not so in 2022.
On Wednesday, the Port of Los Angeles reported its lowest import total for September since 2009, amid the Great Recession. The day before, the neighboring Port of Long Beach posted its weakest import total for September since 2016.
Imports to Southern California ports are falling fast because shippers have shifted volumes to East and Gulf coast ports, fearing disruptions from West Coast port labor negotiations. Simultaneously, volumes are now pulling back nationwide due to falling demand.
Holiday imports ‘dropped precipitously’
“In the month of September is where the real story lies,” explained Gene Seroka, executive director of the Port of Los Angeles, during a news conference on Wednesday.
Earlier this year, imports of durable goods bought heavily during the pandemic — furniture, appliances, etc. — began pulling back. In September, declines were heavily driven by reductions in holiday goods, as well.
“September is traditionally a high-volume month for end-of-year products,” said Seroka. “Think toys and games, clothing, footwear and other products. Those holiday gift items dropped precipitously compared to last September, mainly because they came in earlier. This year our peak season was in June and July, as savvy importers moved up the arrival of these goods to bring some certainty back to when they could get to market.”
Commenting on the shift to East and Gulf coast ports, Seroka said “concern over the dockworkers labor contract negotiations [was] a major factor contributing to volume declines.” He believes the shift “is likely to continue until a West Coast labor contract is in place — and that can’t happen soon enough.” The previous contract expired July 1.
Asked by American Shipper how October’s volumes are shaping up versus September’s, he said they will be “probably about the same or a little bit lighter. It’s going to be a soft October.”
LA September imports down 15% vs. August
The Port of Los Angeles reported total throughput of 709,873 twenty-foot equivalent units in September, down 21.5% year on year (y/y). Exports came in at 77,680 TEUS, up 2.6% y/y, while empties totaled 288,731 TEUs, down 19.8% y/y.
Loaded imports to Los Angeles totaled just 343,462 TEUs, down 26.6% y/y. Imports fell 15.1% sequentially versus August, following a 16.7% drop in August versus July.
Los Angeles’ imports reached their highest level this year in May. September imports were down 31.3% compared to that month. Imports in September were the lowest for any month since May 2020, when the U.S. was in the midst of COVID-19 lockdowns.
Long Beach September imports down 11% vs. August
The Port of Long Beach reported total throughput of 741,823 TEUs for September, down 0.9% y/y. Exports came in at 112,940 TEUs, up 1.9% y/y, and empties totaled 286,212 TEUs, up 7% y/y.
Long Beach handled 342,671 TEUs of imports in September, down 7.4% y/y and down 10.9% sequentially versus August. As in Los Angeles, Long Beach’s imports peaked this year in May. September was down 27.5% from that high. Monthly imports have not been this low since June 2020.
Port of Long Beach Executive Director Mario Cordero blamed the import decline on consumer and retail concerns about inflation, “leading to warehouses filled with inventory and fewer product orders from Asia.”
Fewer ships being worked at berths
The focus during the supply chain crisis was on the massive number of container ships at anchorages or loitering offshore as they waited for berths in Los Angeles or Long Beach. Statistics from the Marine Exchange of Southern California show a steep drop throughout this year, from a high of 109 waiting container ships Jan. 9 to just four on Wednesday, the lowest number since October 2020.
The Marine Exchange also collects data on the number of container ships at the berths in the two ports. This data also shows a major — and more recent — change.
As the supply crisis intensified, there were often over 30 ships at the two ports’ berths each day. Between August 2021 and February 2022, there were an average of 28.8 container vessels alongside in Los Angeles and Long Beach daily.
In recent weeks, however, the numbers have sunk to much lower levels. The average from Sept. 1 through Tuesday was 19 ships alongside, down over 30% from peak levels. There were 18 ships at the ports’ berths Tuesday. There were only 10 ships alongside on Sept. 12.
This is getting closer to pre-COVID levels. The average number of ships at the ports’ berths daily in full-year 2019 was 14.8.
Click for more articles by Greg Miller
October 20, 2022
Dow reports third quarter 2022 results
Oct. 20, 2022 6:00 AM ETDow Inc. (DOW)
MIDLAND, Mich., Oct. 20, 2022 /PRNewswire/ — Dow (NYSE: DOW):
FINANCIAL HIGHLIGHTS
- GAAP earnings per share (EPS) was $1.02; Operating EPS1 was $1.11, compared to $2.75 in the year-ago period and $2.31 in the prior quarter, reflecting margin compression due to higher energy costs, primarily in Europe, the Middle East, Africa and India (EMEAI).
- Net sales were $14.1 billion, down 5% versus the year-ago period, as gains in Performance Materials & Coatings were more than offset by declines in Industrial Intermediates & Infrastructure and Packaging & Specialty Plastics. Sequentially, sales were down 10% with declines in all operating segments and regions.
- Local price increased 3% versus the year-ago period, driven by Performance Materials & Coatings and Industrial Intermediates & Infrastructure. Sequentially, local price decreased 6% with declines in all operating segments and regions.
- Currency decreased net sales by 4% year-over-year and 1% versus the prior quarter due to broad-based strength of the U.S. dollar.
- Volume was down 4% versus the year-ago period, as a 12% decline in EMEAI more than offset 2% volume growth each in the U.S. & Canada and Asia Pacific. Sequentially, volume was down 3%, led by an 8% decline in EMEAI.
- Equity losses were $58 million, compared to equity earnings of $249 million in the year-ago period and $195 million in the prior quarter, led by margin compression in polyurethanes at Sadara and MEG at the Kuwait joint ventures.
- GAAP Net Income was $760 million. Operating EBIT1 was $1.2 billion, down from $2.9 billion in the year-ago period, as gains in Performance Materials & Coatings were more than offset by higher raw material and energy costs as well as lower equity earnings. Operating EBIT decreased from $2.4 billion in the prior quarter due to margin compression across all operating segments.
- Cash provided by operating activities – continuing operations was $1.9 billion, down $779 million year-over-year and up $84 million compared to the prior quarter. Free cash flow1 was $1.5 billion.
- Returns to shareholders totaled $1.3 billion, comprised of $800 million in share repurchases and $493 million in dividends in the quarter.
CEO QUOTE
Jim Fitterling, chairman and chief executive officer, commented on the quarter:
“In the third quarter, Team Dow managed significant macroeconomic headwinds as we swiftly initiated actions and aligned production with supply chain and logistics constraints, prioritized resources toward higher-value products, and reduced operational costs across the enterprise. As a result, we maintained our focus on cash flow generation and continued to execute on our capital allocation strategy, returning $1.3 billion to shareholders.
“Underlying demand remains resilient in the U.S., while high energy and feedstock costs are driving record inflation and impacting demand in the Eurozone, and ongoing lockdowns in China continue to pressure both consumer spending and infrastructure investments. Moving forward, our global scale, geographic diversity, and advantaged feedstock and derivative flexibility will continue to be the source of our distinct advantages. Our track record of employing a disciplined and balanced approach to capital allocation, focus on cash flow generation, and our strengthened balance sheet provide a solid foundation as we continue managing through these dynamic global conditions.”
Industrial Intermediates & Infrastructure
| Three Months Ended September 30 | Three Months Ended June 30 | ||||
| In millions, except margin percentages | 3Q22 | 3Q21 | vs. SQLY [B / (W)] | 2Q22 | vs. PQ [B / (W)] |
| Net Sales | $4,059 | $4,481 | $(422) | $4,370 | $(311) |
| Operating EBIT | $167 | $713 | $(546) | $426 | $(259) |
| Operating EBIT Margin | 4.1 % | 15.9 % | (1,180) bps | 9.7 % | (560) bps |
| Equity Earnings (Losses) | $(114) | $122 | $(236) | $57 | $(171) |
Industrial Intermediates & Infrastructure segment net sales were $4.1 billion, down 9% versus the year-ago period. Local price improved 5% year-over-year with gains in both businesses. Currency decreased net sales by 5%. Volume was down 9% year-over-year, as declines in Polyurethanes & Construction Chemicals were partly offset by gains in Industrial Solutions due to demand strength in pharmaceutical, agricultural, and energy applications. On a sequential basis, the segment recorded a net sales decline of 7% on lower local price and currency with stable volume.
Equity losses for the segment were $114 million, a decrease of $236 million compared to the year-ago period. Competitive pricing pressures in propylene oxide derivatives and MEG due to supply additions in China, as well as lower demand in EMEAI were the main impacts. On a sequential basis, equity earnings decreased by $171 million primarily due to lower price at Sadara and the Kuwait joint ventures.
Operating EBIT was $167 million, compared to $713 million in the year-ago period and $426 million in the prior quarter, as lower EMEAI demand and increased energy and raw material costs were partly offset by higher prices. On a sequential basis, operating EBIT margins declined 560 basis points on lower price and higher energy costs.
Polyurethanes & Construction Chemicals business reported a net sales decrease compared to the year-ago period, as local price gains were more than offset by lower volumes due to inflationary pressures on demand in EMEAI and currency impacts. Sequentially, net sales declined as improved demand in mobility end-markets was more than offset by lower price and inflationary impacts on demand for consumer durables, industrial, and building & construction applications.
Industrial Solutions business reported a net sales increase compared to the year-ago period, driven by local price gains and strong demand for pharmaceutical, agricultural, and energy applications. Sequentially, net sales decreased as strong demand in energy, pharmaceutical, and mobility end-markets and increased catalyst sales were more than offset by price declines and currency impacts.
OUTLOOK
“In the near-term, we expect the macro environment to remain dynamic. As a result, we have outlined a playbook of actions that have the potential to deliver more than $1 billion in cost savings in 2023 while we continue to leverage our scale, geographic diversity and feedstock and derivative flexibility,” said Fitterling. “At the same time, we remain focused on advancing our Decarbonize and Grow strategy with higher-return investments that will extend our competitive advantages and industry leadership positions. Our strong financial position and balance sheet as well as our continued focus on cash flow generation give us ample flexibility to execute on our capital allocation priorities, including attractive shareholder remuneration, as we maximize value creation over the longer-term.”
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