The Urethane Blog
September 8, 2026
SunSirs: The Propylene Oxide Market Saw an Upward Shift in Its Price Center in August
2026-09-08 12:25:01Source:ChemNet
In August, the domestic propylene oxide market exhibited a wide-ranging “M-shaped” fluctuation pattern, with the overall price level shifting significantly upward. Data from the SunSirs monitoring system indicates that as of August 31, the benchmark price for propylene oxide stood at 9,350 RMB/ton, marking a 1.63% increase compared to the beginning of the month.
Raw Materials: There is strong cost-side support. Prices for the feedstock propylene remain high. According to the SunSirs monitoring system, the benchmark price for propylene stood at 8,721.00 RMB/ton as of August 31, marking a 10.01% increase from the beginning of the month (7,927.67 RMB/ton). International oil prices have trended upward due to geopolitical tensions, further solidifying the cost floor across the industry chain. Under the pressure of high costs, many production processes within the industry are operating at a loss, creating a strong price floor for propylene oxide.
Supply side: Market supplies remained tight due to a concentration of plant maintenance shutdowns. Domestic propylene oxide production in August totaled 499,800 tonnes—down 0.64% month-on-month and 5.70% year-on-year—with the capacity utilization rate falling to 60.25%. Multiple units, including those at Zhenhai Phase II, Qixiang, Lianhong, and Satellite Chemical, were offline; an unexpected shutdown of Wanhua Chemical’s Phase III unit further exacerbated the tight spot supply situation. Total production losses due to maintenance remained at a high level of approximately 220,000 tonnes for the month.
Demand side: Overall performance remains weak. August falls within the traditional off-season for demand, with sluggish trading activity in sectors such as upholstered furniture, home appliances, and automobiles. Downstream polyether manufacturers and the end-user foam industry are strongly resistant to high-priced raw materials, limiting procurement primarily to small, essential orders with little growth in new order volumes. However, continued external purchasing by major players like Wanhua Chemical has, to some extent, offset this weak demand.
Overall Forecast: Market variables are increasing in September. On the supply side, facilities such as those of Lianhong New Materials and Shenghua New Materials are expected to resume production, potentially leading to a gradual rise in supply pressure; however, large-scale facilities are still scheduled for maintenance in the second half of the year. On the demand side, the arrival of the traditional “Golden September and Silver October” peak season is likely to drive a moderate recovery in downstream demand. Overall, the propylene oxide market is expected to experience fluctuating trends in September, shaped by the interplay between cost support and supply-demand dynamics; key factors to monitor include the actual progress of facility restarts and the recovery of downstream demand during the peak season.
September 7, 2026
Deutsche Bank: August US Auto Sales Beat Forecasts, But Incentives Remain A Factor
by Tyler Durden
Friday, Sep 04, 2026 – 02:40 PM
U.S. auto sales came in stronger than expected in August, offering another sign that consumer demand for new vehicles remains relatively resilient despite elevated borrowing costs and broader questions about the economy.
According to Deutsche Bank’s auto team, led by Edison Yu, August sales ran at a seasonally adjusted annual rate of roughly 16.9 million vehicles. That was comfortably ahead of the bank’s 16.4 million estimate and also above the roughly 16.4 million pace recorded a year earlier.
The headline SAAR number was strong, although the underlying monthly figures were somewhat less impressive. Automakers sold approximately 1.388 million vehicles during August, slightly above July’s 1.380 million but below the roughly 1.482 million vehicles sold in August 2025.
Sales among both the Detroit Three and major Japanese automakers were modestly better than Deutsche Bank expected. But Hyundai Group was one of the biggest contributors to the upside surprise, beating the bank’s forecast by approximately 14,000 vehicles. Other brands accounted for the remainder of the beat.
The closely watched large pickup market was more mixed. Daily sales declined for most major truck models, but Ram was a notable exception. Ram sales increased by roughly 105 vehicles per day to around 1,550, with Deutsche Bank attributing much of that strength to aggressive incentive spending.
Higher sales are obviously positive for volumes, but when they are being generated through heavier discounts and incentives, the improvement doesn’t necessarily translate into equally strong profitability for manufacturers.
Inventory remains relatively controlled. Industry-wide inventories slipped to approximately 49 days of supply, compared with 50 days previously, although that remains above the 47-day level seen in 2025. Truck inventories declined by one day to 52 days of supply, while passenger-car inventories dropped by two days to just 34.
Taken together, the August numbers paint a reasonably healthy picture of the U.S. auto market. Sales are running better than expected, inventories aren’t showing signs of a major glut, and the annualized selling rate remains comfortably above 16 million vehicles.
Deutsche Bank isn’t extrapolating August’s 16.9 million pace into a dramatically stronger industry forecast, however. Yu and his team continue to expect a 16.0 million SAAR for full-year 2026, roughly consistent with forecasts from the major automakers themselves. For 2027, Deutsche Bank is forecasting only a modest improvement to 16.1 million.
In other words, August was a good month, but Deutsche Bank isn’t calling it the beginning of an auto boom. The more interesting question from here may be how much manufacturers have to spend on incentives to keep sales around these levels…particularly if consumers remain squeezed by high vehicle prices and financing costs.
September 6, 2026
El Nino Crushes Atlantic Hurricane Activity, Lowest Since 1941
by Tyler Durden
Friday, Sep 04, 2026 – 06:50 PM
The peak of the Atlantic hurricane season arrives next Thursday, yet by this point the basin would normally have produced multiple systems tracking through the Caribbean, the Gulf of America, and the open Atlantic. This year, however, a strengthening El Niño and record vertical wind shear are tearing apart disturbances before they can rapidly intensify.
Bloomberg reports that only five short-lived tropical storms have formed this season, and none has intensified into a hurricane. The Atlantic has not recorded so little activity at this point in the season since 1941.
“We’re crushing all sorts of shear records this year,” said Phil Klotzbach, lead author of Colorado State University’s annual seasonal forecast. “The models are so anemic on storm development coming up in the next 10 days too.”
Forecasters and researchers are tracking accumulated cyclone energy, or ACE, which measures the combined strength and duration of tropical storms and hurricanes during a season.
“We currently have an ACE of 4.4,” Klotzbach said. That is the lowest since 1941. A low ACE indicates that storms have generally been weak or short-lived, reflecting the fact that no tropical disturbance has intensified into a hurricane.
For the US energy complex, the absence of hurricane activity is great news. Gulf Coast refineries, offshore platforms, pipelines, and LNG export terminals have avoided precautionary shutdowns, allowing facilities to operate near full capacity as the global refined-products crisis deepens. This has been a boon for US producers as the country exports record volumes of crude oil and diesel.
Still, a lull in tropical activity does not entirely rule out the possibility of a destructive late-season storm, as roughly 12.5 weeks remain before the season ends on November 30.
Meanwhile, Southern California and Hawaii are bracing for potential impacts from tropical systems over Labor Day weekend.
“It just seems like it’s one storm after another out there because of the atmospheric conditions and the water being pretty warm,” Robbie Berg, a warning coordination meteorologist at the National Hurricane Center, told the outlet, referring to the activity in the Pacific.
El Niño Impacts
“For an El Niño year, this is what we would expect,” Berg said.
https://www.zerohedge.com/weather/el-nino-crushes-atlantic-hurricane-activity-lowest-1941
September 3, 2026
Over 50% of vessels delayed at Asia’s busiest container ports
Congestion at Asian ports has been driven by extreme weather events and wider supply chain disruption
Marcus Hand,Editor
September 3, 2026
Credit: Pixabay
Analysts Sea-Intelligence say that all 14 of the busiest container ports in Asia have seen a decline in on-time vessel arrivals.
The world’s two largest container ports – Shanghai and Ningbo-Zhoushan have been consecutive typhoons this year, most recently typhoon Saudel last week causing severe delays at the ports.
Ningbo, which became the world’s second largest container port in the first half of 2026, saw its reliability fall by 20.1 percentage points to 34.6% in the month of July according to Sea-Intelligence.
The analyst described the picture in Shanghai as “particularly alarming” with a 19.2 percentage points drop in reliability resulting in just 21% of vessels arriving on time at port in July.
“Outside of extreme pandemic‑era supply chain disruptions, schedule reliability in Shanghai has never dropped this low in 14 years of recorded data,” commented Alan Murphy, CEO of Sea-Intelligence.
The largest drop in schedule reliability among top Asian ports was seen at Yantian in South China with a 23.5 percentage point plunge to 48.3% in July. Hong Kong also saw a 20.4 percentage point drop in reliability to 51.6% for July.
The fall in reliability was pronounced at the world’s largest transhipment hub of Singapore with a 5.7% percentage point drop in July, however reliability sat at just 43.2% Sea-Intelligence said. Looking at other ports in the region Port Klang had 33.3% reliability and Busan 40.9%.
The growth in delays at major Asian ports has driven a drop in schedule reliability for container to 56.1% falling 6.1 percentage points the steepest single month decline since the height of the pandemic in January 2021 the analyst said.
“With the region’s busiest ports operating with more than half of their incoming vessels delayed, this backlog will naturally cascade through the maritime network, likely triggering a new wave of delays for critical head‑haul trade lanes in the coming months,” Murphy said.
Port congestion in Asia is pushing lines to end two and half year long rerouting of Asia – Europe services via the Cape of Good Hope back to the Suez Canal and the Red Sea despite the ongoing security threat from the Houthi in Yemen with its “blockade” of Saudi Arabian ports.
September 2, 2026
Somnigroup International Inc. (SGI) Discusses Strategic Acquisition of Leggett & Platt and Enhanced Vertical Integration Transcript
Sep 02, 2026, 12:44 PM ETSomnigroup International Inc. (SGI) Stock
Somnigroup International Inc. (SGI) Discusses Strategic Acquisition of Leggett & Platt and Enhanced Vertical Integration September 2, 2026 8:00 AM EDT
Company Participants
Lauren Avritt – Director of Investor Relations
Scott Thompson – Chairman of the Board, CEO & President
Bhaskar Rao – Executive VP & CFO
Scott Thompson
Chairman of the Board, CEO & President
Thank you, Lauren, and good morning, everyone. Today is a significant day. We have officially closed the Leggett & Platt transaction, and I’m pleased to welcome the Leggett & Platt team to the Somnigroup family. This milestone marks the next chapter in our strategic journey and one we believe strengthens Somnigroup’s competitive position around the world.
A few facts on Somnigroup post-closing. Over $11 billion in trailing 12-month sales, over $750 million trailing 12 months net income, $20 billion enterprise value, $15 billion market cap. Over 170 manufacturing plants around the world. 2,800-plus retail stores with various formats customized for each international market. Over 40 e-commerce websites, selling direct to consumer with aggregate sales of over $500 million per year. 36,000 talented associates led by a very experienced management team. And customers, both retail and wholesale in over 100 countries. We are building a special vertically integrated company with numerous competitive advantages, outstanding cash flow generation attributes, a diversified customer base and a passionate workforce dedicated to customers in various markets and industries.
What we see in Leggett & Platt is a company with 143-year long legacy of exceptional people, world-class manufacturing, strong commitment to customer service and best-in-class expertise in bedding components. They also have a long track record as one of our most important suppliers. We know them well, and they know us well. That familiarity is an asset as we move forward as a combined company. First and foremost, the combination deepens our vertical integration, and it adds significant scale expanding sourcing opportunities, enhancing operational flexibility to a portfolio of assets that is already industry-leading. It also extends our reach across industries beyond bedding which will provide the company solid free cash flow and growth as markets normalize and these strategies are implemented. Strategically and economically, this is the right deal at the right time with the right partner.
Let me take you through how this transaction advances the strategic pillars we outlined at our Investor Day last March. Global scale and vertical integration, relentless consumer-centric innovation, relentless cash generation, disciplined capital allocation and a uniquely favorable position in the $120 billion global bedding market recovery. The Leggett & Platt acquisition checks every one of these boxes. Most directly, it strengthened our vertical integration advantages. Leggett & Platt is a primary supplier of important components to the bedding industry and particularly to our own manufacturing operations. They supply innerspring units, specialty foam and other key components to producers around the world, bringing their capabilities in-house further fortifies our supply chain in an uncertain world and allows us to optimize cost and drive quality end-to-end in the supply chain. The combination brings component engineering closer to mattress design and closer to the consumer insights we generate every day across our retail platform. That proximity supports accelerated innovation cycles. It means we can develop more cost-effective and consumer-centric products.
In addition to expanding our addressable market in bedding, Leggett & Platt’s product portfolio includes automotive seating systems, furniture components, geo components, and hydraulic cylinders also allow us to participate in industries beyond global bedding. These diversified sales streams as well as Leggett & Platt’s geographic footprint broadens our earnings base, and mitigates reliance on any single category, product or geographic market.
Let me say a word about how we intend to operate Leggett & Platt within the Somnigroup portfolio. Leggett & Platt will operate as a stand-alone business unit within Somnigroup, consistent with our approach with Tempur Sealy, Mattress Firm and Dreams. We believe this decentralized operating model is one of our structural advantages. It allows each business unit to stay close to its customers and markets and quickly respond and develop strategies in an ever-changing world, while also benefiting from Somnigroup’s expertise, scale, strong balance sheet and operational leverage.
A word on leadership. First, we’re very fortunate that Leggett & Platt has an experienced workforce dedicated to quality and customer service, which is led by a strong committed executive team with depth and a passion to succeed. To enhance their leadership structure, you most likely saw we announced the appointment Tyson Hagale as President of Leggett & Platt. Tyson is a 25-year Leggett & Platt veteran with a broad expertise across all corners of the business, including strategic planning, operational leadership and M&A. Most recently, he served as President of the Bedding Products segment, delivering results and operational improvements through some of the most dynamic conditions in the industry has ever seen. He knows Leggett & Platt well, including the non-bedding components. Karl Glassman will continue to lead Leggett & Platt as CEO over the near term, working closely with Tyson and Somnigroup executives as we bring the companies together. I’m looking forward to working with Karl and Tyson.
Moving to near-term strategic initiatives. We expect some early wins. We have long believed that high-quality innerspring systems represent a meaningful point of differentiation and important feature for customers. While the mattress category has traditionally emphasized finished product branding, we see the opportunity to elevate awareness of underlying technologies and components that contribute to comfort, support, durability and overnight fleet quality. Simply put, what is in your mattress matters. As a result, we are working to amplify the differentiated innovation by incorporating Leggett & Platt innerspring branding on the exterior selected mattress products. We believe this approach helps highlight the value of the technology inside the mattress while creating greater transparency and confidence for customers at the point of purchase. This initiative will initially roll out with our launch of the all-new Stearns & Foster collection this fall. It represents an important step in our broader strategy to increase consumers’ recognition of the premium component of engineering that differentiates our products. We believe stronger visibility of the Leggett & Platt innerspring technology can enhance the consumer shopping experience, support our retail partners’ merchandising efforts and further reinforce the value proposition of mattresses that incorporate our technology.
Ultimately, we view this as much more than a branding initiative. This is a reflection of the strategic vision behind the acquisition of Leggett & Platt’s bedding business and the unique capabilities that the transaction creates. By bringing ownership of innersprings, the heart of the bed, into the portfolio we are now able to more closely integrate component innovation, mattress design, driving consumer engagement. We believe that position enables us to set higher standards for innovation, durability, quality and transparency across the industry, while creating connection between the technology inside the mattress and the magic consumers experience every night. We should also note that Mattress Firm as it continues to focus on customer first, recently communicated to its supplier base, new and more stringent merchandising criteria, including the qualification of key component inputs, both Leggett & Platt’s innerspring systems and the foams produced by ECS, their specialty foam operations have been qualified under these enhanced standards. This is direct validation of the quality and consistency that Leggett & Platt brings us to our supply chain. I’ll say it again, what is inside your mattress matters.
In closing, I want to leave you with a few key thoughts. We are the leading vertically integrated bedding company in the world. We now forge our own steel, create our own springs and foam. We design and build our own products. We develop and market our brands and sell our products, which cover all price points in a balanced omnichannel format across the world. We believe that the $120 billion global bedding market remains structurally intact and positioned to normalize from its historically depressed levels. Now let’s be clear, the bedding market has experienced an extended period of weakness, and we have used that time deliberately to build the platform you see today, while also growing adjusted EPS and deleveraging. We are investing ahead of the recovery and building our brands, driving upper funnel advertising and strengthening our infrastructure. It’s not a question if the bedding market is going to turn around. It’s a question of when and whether you are positioned to lead when it does, and we are positioned to win and win big.
Bhaskar Rao
Executive VP & CFO
Thank you, Scott. Let me start with some housekeeping items on our reporting structure going forward. Leggett & Platt will be reported as a single consolidated reportable segment within Somnigroup, consistent with our other reporting segments, Tempur Sealy North America, Tempur Sealy International and Mattress Firm. Now moving to synergies. When we announced this transaction, we identified approximately $50 million in synergy opportunities on an annual run rate basis, focused on sourcing, operations and product innovation. That figure was based primarily on our internal diligence work at that time. Since then, we have worked with Leggett to refine our expectations. As a result of the team’s combined efforts, we are increasing that synergy estimate by 50% to $75 million on an annual run rate basis with additional opportunities in our synergy funnel that will be evaluated over the next year. .
Within sourcing, we see opportunities to expand profitability by bringing select components in-house and/or improving purchasing economics across our supplier base. To date, we have included $35 million of sourcing related synergies in our target. One of the most immediate and tangible examples is innersprings. Beginning in January 1, 2027, we expect to manufacture over 90% of our total U.S. spring needs internally, creating a meaningful cost savings opportunity and further strengthening integration across the business. We are reviewing additional supply chain opportunities and expect our combined sourcing efforts to support greater cost efficiency, particularly in chemicals. In addition, we expect the broader platform to create savings across third-party professional services.
Rafe Jadrosich
BofA Securities, Research Division
I just wanted to follow-up on the sourcing synergies that the 90% of — the expectation that you’ll be 90% internal sourcing for your springs. Can you talk about where that is today, like what that delta is? How much you’re getting from Leggett versus either other suppliers or internal right now, so like what that changes? And then does that include anything with Elite Comfort Systems in the foam side? Or is that all — that sourcing number all innersprings?
Scott Thompson
Chairman of the Board, CEO & President
Yes. We were under a long-term contract with Leggett pre-combination of 80% of our springs in the U.S., this is just a U.S. comp discussion coming from Leggett, so you should think about it as incrementally 10%, and we’ll probably be a little bit north of 90% over time would be my guess. That number is in the synergies. There’s nothing significant currently in the synergy number on the ECS side as we work through the ECS side of the house. We have a great supplier currently, what I’m going to call base foam, and they’re doing a great job, and we’re working with them and working with ECS and trying to find an optimal structure there, but we’ve got great suppliers on the base foam already.
Michael Lasser
UBS Investment Bank, Research Division
There are very few examples where one company such as Somnigroup control such a disproportionate amount of the profitability within the sector, and the bedding industry is interesting in that historically, it’s relied heavily on pricing as a key contributor to the overall growth of the sector. So my two-part question is, a, Scott, do you see any changes in the overall economics of the bedding industry as a result of Somnigroup’s unique position; and b, how are you looking at the overall pricing architecture of the industry moving forward as a key contributor to the overall top line results?
Scott Thompson
Chairman of the Board, CEO & President
Thank you for the question, and there’s probably some of my lawyers on the phone now that are going like, I hope he doesn’t really say much on that question, but let me talk about — first of all, you’re right. It’s a couple of things that are really unique. It’s really unique that a company was able to take a downturn, and the downturn has been, on a historical basis, it’s been the worst downturn ever, and be able to build what we’ve built. I mean it really is game changing. And you’re right, I don’t know what percentage of worldwide bedding profits Somnigroup now has, but it’s large, we’ll say it.
As far as the pricing architecture, I think the profitability of the bedding industry is going to be enhanced as we take out redundant costs and we add synergies. I think the economists and certainly, history would be the FTC would look at that and expect that some of that would creep into the customers’ pocket. And maybe it does, maybe it doesn’t. But from a competitive advantage standpoint, it certainly should create a competitive advantage in the marketplace.
Peter Keith
Piper Sandler & Co., Research Division
Big picture on the industry and potential rebound, so it looks like we’re now entering our fifth year of mattress industry sales declines. We do have positive GDP growth, there’s been a tax refund cycle earlier in the year. When you guys are thinking about the industry rebounding and getting better, what do you think needs to happen in the economy looking forward? And I understand housing would be an easy answer, but we all agree that, that’s a minority of total mattress sales purchases?
Scott Thompson
Chairman of the Board, CEO & President
The real answer is housing is an incremental headwind or incremental tailwind usually not hugely material, but you’d rather have a tailwind than a headwind. It’s consumer confidence which I would point back into a little less — a little more stable environment because look, these are discretionary goods, they are expensive and so when consumers are not confident and sentiment is really negative, they have — some portion of the customers tend to postpone. It’s interesting because it’s in-floor traffic. The customer who actually is in the funnel to purchase a bed, once in the funnel, gets through the funnel fairly quickly, or in standard form and it gets into the store and the closing rates are very strong.
So you don’t have an issue on pricing. You don’t have an issue on quality of products, quite frankly, the products, ours and others in the bedding industry are good. You’ve got a strong kind of health and wellness concept that goes through the industry. People do care about their bed. They do care about their health, and people with means are showing up and buying. Who’s not showing up are the more of the entry-level customers, if you want to say, the K economy or whatever or people who are a little unsettled by current events. So the first thing I’d say is we just need less drama in the world. And we’ve had it a few times, okay, where there’s a period where there’s a little less drama, and you can see it in the numbers. I mean, floor traffic picks up, sales pick up, but then we get some tariff drama, some Middle East drama and people’s hands go back into their pockets. That would be my first answer to that.
And the second answer is we need to continue to have the industry advertise, have effective advertising, make sure it’s compelling and get it placed in a way in the marketplace that consumers are seeing the ads and that it’s influencing them to think about their bed to get into the purchase funnel. The biggest — the issue is getting people triggered to think about their beds. If you look at the installed base, and this isn’t like the car business where you can look at a VIN and you know exactly what the average age of all the cars are on the road, how many miles they’ve driven. We don’t have that kind of data, but there is no question if you look at the volume declines over what — you’re right, into the fifth year that the products that are in the marketplace are probably older than they’ve ever been. There’s also no question that beds do wear out, and there’s no question that people are going to sleep on beds. The industry is structurally sound. There’s nothing that’s threatening the industry from a structural standpoint. So that’s why I kind of go back to — I don’t know, I can’t tell you the exact turn, but there’s — but everything points to what we just need is a little more stability in the way the consumers are thinking about the world.
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