The Urethane Blog
Everchem Updates
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 12, 2022
BASF Group releases preliminary figures for the third quarter of 2022 and announces cost savings program
- Sales, EBIT before special items and EBIT slightly above average analyst estimates
- Net income expected to be €909 million (Q3 2021: €1,253 million) due to non-cash-effective impairments, considerably below the prior-year quarter and considerably below analyst consensus
- Cost savings program of €500 million annually with focus on Europe and particularly Germany due to deteriorating framework conditions
- Outlook for the business year 2022 remains unchanged
Ludwigshafen – October 12, 2022 – BASF has released preliminary figures for the third quarter of 2022. Sales, income from operations (EBIT) before special items and EBIT are slightly above average analyst estimates.
Net income of BASF Group is expected to amount to €909 million. This is considerably below the prior-year quarter figure (Q3 2021: €1,253 million) and the average analyst estimates for the third quarter of 2022 (Vara: €1,105 million). Net income contains non-cash-effective impairments on the shareholding in Wintershall Dea in the amount of about €740 million. These result from the partial write-down of Wintershall Dea’s participation in Nord Stream AG, which operates the Nord Stream 1 pipeline.
Sales increased by 12 percent in the third quarter of 2022 to €21,946 million (Q3 2021: €19,669 million). This was mainly driven by higher prices. Currency effects, primarily relating to the U.S. dollar, had a positive effect as well. Volumes declined compared with the prior-year quarter. Sales thus slightly exceeded average analyst estimates for the third quarter of 2022 (Vara: €21,076 million).
EBIT before special items amounted to an expected €1,348 million in the third quarter of 2022, considerably below the level of the prior-year quarter (Q3 2021: €1,865 million) and slightly above the analyst consensus for the third quarter of 2022 (Vara: €1,313 million). Increased prices for raw materials and energy could only partly be passed on through higher selling prices.
EBIT amounted to an expected €1,294 million in the third quarter of 2022, considerably below the figure for the prior-year quarter (Q3 2021: €1,822 million) and slightly above the analyst consensus for the third quarter of 2022 (Vara: €1,285 million).
The outlook published by the BASF Group for the 2022 business year in July remains unchanged. EBIT before special items continues to be expected between €6.8 billion and €7.2 billion.
Cost savings program of €500 million annually
Against the background of significantly weaker earnings in Europe – especially in Germany, where earnings in the third quarter of 2022 were negative – as well as the deteriorating framework conditions in the region, BASF has initiated a cost savings program focusing on Europe and particularly Germany to be implemented from 2023 to 2024. Cost savings possible in the short term will be implemented immediately. Upon completion, the program is expected to generate annual cost savings of €500 million in non-production areas. More than half of the cost savings are to be realized at the Ludwigshafen site. Operating, service and research & development divisions as well as the corporate center are to be streamlined.
Further measures to structurally adjust BASF’s production Verbund in Europe in the medium and long term are currently being developed and are expected to be communicated in the first quarter of 2023.
Employee representatives in the relevant bodies will be involved regarding the different measures.
October 11, 2022
US imports sink in September, suffer steepest drop since 2020 lockdowns
Descartes: September imports down 11% year on year and 12.4% vs. August
Greg Miller Follow on Twitter Monday, October 10, 2022
4 minutes read
First came the pullback in spot shipping rates from their historic peak. Then came reports of plunging Asian bookings and mass retail order cancellations, with spot rates falling even faster. Now, all of this is finally showing up at America’s ports.
According to Descartes, which aggregates U.S. Customs data, inbound volumes to all U.S. ports totaled 2,215,731 twenty-foot equivalent units in September. That’s down 11% year on year and 12.4% from August.
Last month’s imports came in below September 2020 levels, albeit still up 9% from September 2019, pre-COVID. Imports this September were down 15.5% versus May, the month inbound volumes hit an all-time high, according to Descartes data.
To put the severity of last month’s drop in historical perspective, September’s 313,311-TEU decline versus August was the steepest month-to-month drop since the 364,454-TEU plunge in February 2020 versus the month before, back when Chinese authorities first locked down Wuhan.
“We’ve had a pretty significant correction here,” said Chris Jones, executive vice president of industry and services at Descartes Systems Group, in an interview with American Shipper on Monday.
This is normally the time of year when imports seasonally decline — but not by this much. “There was an inflection, and it was a big one,” he said. “In some respects, this is not inconsistent with other years [pre-COVID]. It’s just more severe.”
If the usual seasonal pattern holds true from here, Jones added, imports “should slow down for the rest of the year.”
Imports decline on all three coasts
This summer, overall U.S. imports remained stubbornly high, hovering near record levels even as West Coast volumes declined. West Coast losses were offset by East and Gulf Coast gains, reportedly due to shippers shifting cargoes eastward due to fears of West Coast peak season congestion and labor unrest.
The pattern changed last month. Ports on all three coasts saw volumes drop versus August, according to Descartes. Most surprisingly, it found that imports fell 21.5% in Savannah, Georgia, from 285,341 TEUs to 223,966 TEUs.
Savannah, along with New York/New Jersey, has been one of the big winners of the eastward shift. Savannah posted record imports in August. It has had the country’s longest queue of waiting ships for months. As of Monday, ship-position data showed 35 ships still waiting. The presence of so many vessels offshore confirms there is no shortage of cargo waiting to be unloaded in Savannah, so how could its import numbers fall so steeply in September?
The answer appears to be: Hurricane Ian. A spokesperson for the Georgia Ports Authority (GPA) told American Shipper: “September volume was impacted due to Hurricane Ian and the suspension of vessel service for roughly three days. GPA has since been accommodating that volume, which will be reflected in October numbers.”
However, the one-off hurricane effect doesn’t change the overall story on U.S. imports. Even with Savannah’s September decline removed from the numbers, countrywide imports fell 11% versus August.
Volumes from China collapsing
The big driver of declines on all three coasts: collapsing imports from China.
According to Descartes, U.S. imports from China totaled 820,329 TEUs in September, down 22.7% year on year and 18.3% versus August. Declines from China accounted for 61.5% of last month’s drop compared to the month before.
“If you think about the lockdowns in China, some of those things have now had a chance to flush themselves out and you now see that in the numbers,” said Jones, noting the lag effect between the lockdowns and the import decline. “These Chinese numbers are way down.”
Commenting on the timing of the September plunge, Jones pointed to multiple lag effects between initial demand weakness and import data weakness, ranging from lags on the origin side to those at America’s ship queues. “Imports are a completely lagging indicator because of the lead times,” he emphasized. “These supply chains are so extended.”
Supply chain crunch not over yet
Declining import volumes should give terminals breathing room to clear out more containers from their yards in the months ahead. Even so, Jones agreed that “it’s too soon to declare victory” when it comes to the supply chain crunch.
Imports and consumer spending are still above pre-pandemic levels. Rail congestion remains high. Both import and empty container levels at terminals remain elevated.
As of Monday morning, there were still 103 container ships waiting offshore of North American ports. Waiting times off East and Gulf Coast ports remained over 10 days in September, according to Descartes. Meanwhile, there has yet to be a breakthrough in the West Coast port labor negotiations and the new rail labor contract still requires approval. (One union has just rejected the proposal.)
The complexity of the situation makes it very difficult for U.S. retailers and importers to plan ahead. “There’s too much and not enough,” said Jones. “Things like personal gaming systems come in the door and they’re out the door, while you have seasonal [goods] where you just get crushed.”
Overall, “consumption has not slowed down as much as people thought,” he continued. Importers “have to make bets and the longer the lead time [due to supply chain delays] the less accurate” those bets turn out. As a result, he said, “we’ll see some cases where too much inventory shows up and others where you can’t get enough of what you need.”
October 11, 2022
US imports sink in September, suffer steepest drop since 2020 lockdowns
Descartes: September imports down 11% year on year and 12.4% vs. August
Greg Miller Follow on Twitter Monday, October 10, 2022
4 minutes read
First came the pullback in spot shipping rates from their historic peak. Then came reports of plunging Asian bookings and mass retail order cancellations, with spot rates falling even faster. Now, all of this is finally showing up at America’s ports.
According to Descartes, which aggregates U.S. Customs data, inbound volumes to all U.S. ports totaled 2,215,731 twenty-foot equivalent units in September. That’s down 11% year on year and 12.4% from August.
Last month’s imports came in below September 2020 levels, albeit still up 9% from September 2019, pre-COVID. Imports this September were down 15.5% versus May, the month inbound volumes hit an all-time high, according to Descartes data.
To put the severity of last month’s drop in historical perspective, September’s 313,311-TEU decline versus August was the steepest month-to-month drop since the 364,454-TEU plunge in February 2020 versus the month before, back when Chinese authorities first locked down Wuhan.
“We’ve had a pretty significant correction here,” said Chris Jones, executive vice president of industry and services at Descartes Systems Group, in an interview with American Shipper on Monday.
This is normally the time of year when imports seasonally decline — but not by this much. “There was an inflection, and it was a big one,” he said. “In some respects, this is not inconsistent with other years [pre-COVID]. It’s just more severe.”
If the usual seasonal pattern holds true from here, Jones added, imports “should slow down for the rest of the year.”
Imports decline on all three coasts
This summer, overall U.S. imports remained stubbornly high, hovering near record levels even as West Coast volumes declined. West Coast losses were offset by East and Gulf Coast gains, reportedly due to shippers shifting cargoes eastward due to fears of West Coast peak season congestion and labor unrest.
The pattern changed last month. Ports on all three coasts saw volumes drop versus August, according to Descartes. Most surprisingly, it found that imports fell 21.5% in Savannah, Georgia, from 285,341 TEUs to 223,966 TEUs.
Savannah, along with New York/New Jersey, has been one of the big winners of the eastward shift. Savannah posted record imports in August. It has had the country’s longest queue of waiting ships for months. As of Monday, ship-position data showed 35 ships still waiting. The presence of so many vessels offshore confirms there is no shortage of cargo waiting to be unloaded in Savannah, so how could its import numbers fall so steeply in September?
The answer appears to be: Hurricane Ian. A spokesperson for the Georgia Ports Authority (GPA) told American Shipper: “September volume was impacted due to Hurricane Ian and the suspension of vessel service for roughly three days. GPA has since been accommodating that volume, which will be reflected in October numbers.”
However, the one-off hurricane effect doesn’t change the overall story on U.S. imports. Even with Savannah’s September decline removed from the numbers, countrywide imports fell 11% versus August.
Volumes from China collapsing
The big driver of declines on all three coasts: collapsing imports from China.
According to Descartes, U.S. imports from China totaled 820,329 TEUs in September, down 22.7% year on year and 18.3% versus August. Declines from China accounted for 61.5% of last month’s drop compared to the month before.
“If you think about the lockdowns in China, some of those things have now had a chance to flush themselves out and you now see that in the numbers,” said Jones, noting the lag effect between the lockdowns and the import decline. “These Chinese numbers are way down.”
Commenting on the timing of the September plunge, Jones pointed to multiple lag effects between initial demand weakness and import data weakness, ranging from lags on the origin side to those at America’s ship queues. “Imports are a completely lagging indicator because of the lead times,” he emphasized. “These supply chains are so extended.”
Supply chain crunch not over yet
Declining import volumes should give terminals breathing room to clear out more containers from their yards in the months ahead. Even so, Jones agreed that “it’s too soon to declare victory” when it comes to the supply chain crunch.
Imports and consumer spending are still above pre-pandemic levels. Rail congestion remains high. Both import and empty container levels at terminals remain elevated.
As of Monday morning, there were still 103 container ships waiting offshore of North American ports. Waiting times off East and Gulf Coast ports remained over 10 days in September, according to Descartes. Meanwhile, there has yet to be a breakthrough in the West Coast port labor negotiations and the new rail labor contract still requires approval. (One union has just rejected the proposal.)
The complexity of the situation makes it very difficult for U.S. retailers and importers to plan ahead. “There’s too much and not enough,” said Jones. “Things like personal gaming systems come in the door and they’re out the door, while you have seasonal [goods] where you just get crushed.”
Overall, “consumption has not slowed down as much as people thought,” he continued. Importers “have to make bets and the longer the lead time [due to supply chain delays] the less accurate” those bets turn out. As a result, he said, “we’ll see some cases where too much inventory shows up and others where you can’t get enough of what you need.”
October 11, 2022
Tempur Sealy, mattress stocks tumble on soft sales survey
Oct. 11, 2022 11:09 AM ETTempur Sealy International, Inc. (TPX), SNBR, PRPLBy: Kevin P. Curran, SA News Editor1 Comment
Mattress manufacturers Tempur Sealy International (NYSE:TPX), Sleep Number (NASDAQ:SNBR), Purple Innovation (NASDAQ:PRPL) slid on Tuesday after Piper Sandler signaled slowing September sales.
Equity analyst Peter Keith pointed to a survey conducted by his firm that reflected a 5% decline in sales amongst the group from 2021. The drop comes only about a month after sales rose sharply surrounding the Labor Day holiday.
“While this was an improvement from prior months (on a mean basis), it suggests a notable drop-off for the 2nd half of September following Labor Day weekend,” Keith told clients.
Shares of Tempur Sealy International (TPX) fell 4.12% and Sleep Number (SNBR) slid 3.68%. Purple Innovation (PRPL), by contrast, see-sawed between positive and negative territory.
Elsewhere, Leggett & Platt shares plummeted after the company cut its guidance.
October 11, 2022
Tempur Sealy, mattress stocks tumble on soft sales survey
Oct. 11, 2022 11:09 AM ETTempur Sealy International, Inc. (TPX), SNBR, PRPLBy: Kevin P. Curran, SA News Editor1 Comment
Mattress manufacturers Tempur Sealy International (NYSE:TPX), Sleep Number (NASDAQ:SNBR), Purple Innovation (NASDAQ:PRPL) slid on Tuesday after Piper Sandler signaled slowing September sales.
Equity analyst Peter Keith pointed to a survey conducted by his firm that reflected a 5% decline in sales amongst the group from 2021. The drop comes only about a month after sales rose sharply surrounding the Labor Day holiday.
“While this was an improvement from prior months (on a mean basis), it suggests a notable drop-off for the 2nd half of September following Labor Day weekend,” Keith told clients.
Shares of Tempur Sealy International (TPX) fell 4.12% and Sleep Number (SNBR) slid 3.68%. Purple Innovation (PRPL), by contrast, see-sawed between positive and negative territory.
Elsewhere, Leggett & Platt shares plummeted after the company cut its guidance.
Everchem Updates Archive 
Sign Up for Email Updates