Dow Inc. had second quarter net sales of $5.5 billion for its polyethylene (PE) and specialty polymers business, a 2% increase from the prior quarter based mainly on gains in the Europe/Mideast/Africa/India (EMEAI) markets, the company reported today.
PE sales were also stronger in the US, Canada and Latin America compared with the prior quarter, while sales in Asia were held back by logistical issues.
"Asia was a little bit low in the second quarter, mainly because Asia was pushing a lot of export volumes out, especially in China, to get ahead of some tariff barriers, and that kind of caused some congestion over there. I think that is working itself out, and we'll see a continued strong export environment out of the US Gulf Coast," Dow CEO Jim Fitterling said in an earnings call with investors.
Dow saw sequentially stronger integrated margins in the PE chain, with the North American industry seeing domestic demand growth of 4% through the first six months of 2024. North American PE exports were particularly robust, representing more than 45% of overall production during the first half, according to data from the American Chemistry Council.
Dow expects North American domestic and export PE demand to remain robust in 3Q, but demand from the EMEAI markets will be seasonally slower. North American PE producers are seeking price increases of 5cts/lb in July and 5cts/lb in August.
"I do think the environment is there for pricing to take hold in the third quarter," Fitterling said, noting that inventories are right in line with historical levels. "I expect the derivatives volumes to be strong. We've got advantaged cost positions and operating rates are strong for us." Fitterling said the impact of Q3 plant maintenance would be similar to the prior quarter.
Dow has scheduled Q3 maintenance at a cracker in St Charles, La. That follows completion of a turnaround at its Sabine cracker complex in Orange, Texas during the second quarter.
The company will be ramping up its Glycol-2 facility in Louisiana during the third quarter, after restarting the unit in June. That facility was shut by an explosion and subsequent fires on July 14, 2023.
In Europe, Dow's crackers used a lighter feedstock slate in Q2, which led to lower byproduct sales in the region, Fitterling said.
Dow had overall net sales of $10.915 billion in Q2, down $505 million from a year ago but up $150 million from the prior quarter.
The company's shares were off about 2% at $52.12 in morning trading on the New York Stock Exchange.
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--Reporting by David Barry, dbarry@opisnet.com; Editing by Anna Matherne Maldonado, amatherne@opisnet.com
(END) Dow Jones Newswires
July 25, 2024 11:23 ET (15:23 GMT)
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