Issue 19, 2022 - Global Chemical Bulletin Quick Facts

The global chemical billion dollar club ranking list is freshly released

In the 2021 Global Chemical Billion Dollar Club ranking list (based on chemical business sales), a total of 108 companies with chemical business sales revenue of more than US$3 billion were eligible
to be shortlisted.
Among them, BASF continued to rank first
with sales revenue of US$92.
964 billion in the chemical business in 2021.
As the world economy recovered strongly from the pandemic, sales revenue and operating profit across the chemical industry increased
significantly in 2021.
The 108 companies on the list had median sales revenue of about $9.
18 billion in 2021 and median sales revenue growth of 30%, a figure that far exceeds inflation and shows that chemical companies can pass on rising costs
.
Operating profit figures prove that most chemical companies are able to maintain and increase operating profits
despite cost pressures.
The 108 companies on the list had a median operating profit of approximately $1.
27 billion, up 65%
year-over-year.

The industry is bearish about the prospects of the global chemical industry

Recently, Dow Chemical and LyondellBassel said that market conditions in Europe have deteriorated sharply in the past month or so, while market conditions in Asia remain poor and market conditions in the United States are uncertain
.
Ken Rann, Executive Vice President, Global Olefins and Polyolefins, LyondellBassel, said: "Over the past six weeks or so, demand for chemical products and margins have declined significantly, particularly in our European operations
.
The negative impact of inflation and energy impacts has clearly compressed profits and reduced demand
.
Dow Chemical President and Chief Financial Officer Howard Anglet gave a similar forecast and announced that Dow Chemical expects earnings before interest, depreciation and amortization (EBITDA) and net revenue to be $600 million
below current analyst consensus expectations.
This represents a decrease of 25% from the estimated EBITDA of $2.
4 billion and a decrease of 4%
from the estimated net revenue of $14.
4 billion.

Demand is falling, and the European chemical market is not optimistic

Recent changing market fundamentals are changing the landscape of the European chemical industry, with demand falling sharply and a lack of willingness
to buy.
After a traditional summer demand off-season, European chemical producers returned to the market, but found that inventory levels for downstream producers remained high and demand was lacking
.
Europe's security of gas supply remains threatened, which in turn has pushed up production costs, which, combined with weak demand, has led some producers to choose to reduce production
.
Oliver Schwartz, an analyst at the Hamburg-based Warburg Institute, said: "At least for now, those products downstream in the value chain are the most affected, but this will not prevent the impact on the upstream products in the value chain, it will just take longer to achieve
.
" "This sentiment echoes pessimism in the olefins market, which is not expected to pick up in September demand
.

South Korea's lubricant base oil exports declined

South Korea's base oil exports were 326898 tonnes in August, down 3% year-on-year, with the exception of 300518 tonnes in June, which was the lowest since
May 2021 (321141 tonnes), data released by the Korea Customs Service showed.
South Korea's base oil exports rose 8% year-on-year to $418.
8 million in August, the third highest in a single month this year, behind $565.
9 million in July and $483.
9 million
in May.
South Korea, one of the world's largest suppliers of API III base oil, imported 20,175 tonnes in August, down 16% year-on-year and 60% month-on-month, the lowest since June 2021 (19,699 tonnes); Imports were $28.
5 million, up 8% year-on-year and down 61% month-on-month, the lowest level
since $23.
9 million in March.