in this issue
Chemical industry weekly news roundup, 31 January
12:04 PM MST | January 31, 2014 | By LINDSAY FROST
This Week in CW:
Earnings season kicked into full swing this week as several companies reported mixed results. In North America, Dow Chemical posted fourth-quarter net income of $963 million, reversing a year-ago loss of $716 million. Earnings were up in all segments, with particular strength in performance plastics. DuPont doubled fourth quarter profits and beat analysts’ estimates as its agricultural segment swung to profit in what is normally a seasonally weak quarter. The company reported net income of $185 million for its fiscal quarter ended 31 December, compared with $92 million in year-ago quarter. Praxair’s results showed gains due to strength in North American markets and the energy industry, specifically hydrogen plants. Net income was $474 million, up 14% year-on-year (YOY), which includes an income tax benefit and bond redemption charge. ExxonMobil reported fourth-quarter earnings of $910 million for the chemical segment, down $48 million year-on-year (YOY) on weaker margins, mainly in specialties. Potash Corporation of Saskatchewan (PotashCorp) reported fourth-quarter earnings of $230 million (26 cts/share), down 45.4% year-on-year (YOY), mainly due to weak prices for nutrients following the breakup of export cartel Belaruski Potash Corp. (BPC) in July. Sherwin-Williams (SW) on Thursday reported fourth-quarter net earnings of $116.1 million, or $1.14/share, up 70.5% year-on-year (YOY), on sales up 10.8%, to $2.46 billion. Elsewhere, Bayer CropScience reported revenues in the quarter ended 31 December 2013 were 6.54 billion Indian rupees ($104.5 million) compared with Rs5.88 billion in the year-earlier quarter. Sumitomo Chemical reported a net profit of ¥24.55 billion ($239 million) for the fiscal first nine months, ended 31 December 2013, compared with a net loss of ¥40.69 billion in the year-ago period.
The American Cleaning Institute’s (ACI) annual meeting kicked off in Orlando, FL this week—with CW on hand to report the latest trends and issues. “Cautious optimism” was the phrase buzzing at the meeting this week. Soapers and home care chemical makers mostly expect a solid, but slow-growing, 2014 as the global economy continues to tick upward gradually. On the flip side, innovative new products such as unit-dose laundry detergents are adding to growth, while raw material costs are expected to remain manageable. Managing TSCA reform as it makes its way through Congress and ensuring that fuel subsidies do not adversely impact oleochemical prices are key priorities for the cleaning chemicals sector, industry leaders said at ACI's Issues Briefing in Orlando. Other issues, including state regulation, emerging rules for anti-bacterial hand soaps, and sustainability initiatives, were also discussed at the briefing. Burdensome and counterproductive regulation and industry’s sustainability efforts emerged as common themes at the Global Industry Update panel at the meeting. Panelists on Tuesday's Global Industry Update included trade association delegates from Europe, Brazil, Japan, Australia, and Canada.
Lanxess says that executive chairman Axel Heitmann has agreed to resign “by mutual agreement,” effective 28 February. The supervisory board has appointed Matthias Zachert, former chief financial officer (CFO) of Lanxess and current CFO at Merck KGaA, as Heitmann’s successor, effective 15 May 2014. Until Zachert joins, Lanxess CFO Bernhard Duettmann will perform the responsibilities of board chairman.
Around the Web:
Al Jazeera America features the growing rare earths market in China, and how it has slumped in the US. Due to their scarcity and huge value, rare earths—and thus by extension the Pea Ridge Mine in Missouri—lie at the heart of a complex geopolitical fight. It is a contest pitting China and the United States, and just about every other powerful nation on earth, into a new great game of diplomacy, business brinksmanship and a fight to dominate the market for these scarce elements. At the moment, China is winning. Over the past few decades, it has bought up nearly the entire supply chain of rare-earth metals and the products they’re used for, leaving other powers struggling to catch up.
The US economy grew at a 3.2% annual rate in the October-December quarter on the strength of the strongest consumer spending in three years, an encouraging sign for 2014, according to the Huffington Post. The fourth-quarter increase followed a 4.1% growth rate in the July-September quarter, when the economy was boosted by a buildup in business stockpiles. The Commerce Department says that for 2013 as a whole, the economy grew a tepid 1.9%, below the 2.8% increase in 2012. Growth was held back last year by higher federal taxes and government spending cuts.
Researchers in India have developed a relatively low-temperature process to convert certain kinds of plastic waste into liquid fuel as a way to re-use discarded plastic bags and other products, writes Phys.org. In their approach, the team heats the plastic waste to between 400 and 500 Celsius over a kaolin catalyst. This causes the plastic's long chain polymer chains to break apart in a process known as thermo-catalytic degradation. This releases large quantities of much smaller, carbon-rich molecules. The team used the analytical technique of gas chromatography coupled mass spectrometry to characterize these product molecules and found the components of their liquid fuel to be mainly paraffins and olefins 10 to 16 carbon atoms long. This, they explain, makes the liquid fuel very similar chemically to conventional petrochemical fuels.