July 2010 Archives

It's been a dream for US-based Dow Chemical to partner with the Olympics for many years, and now that dream has finally become reality.

Dow Chemical's deal with the International Olympic Committee (IOC) to become a Worldwide Olympic Partner and the official chemistry company for the Olympic Games through 2020 is a colossal event - one that has the potential to change the public's perception of the chemical industry.

Forget the $1bn-plus in market opportunity Dow sees from the partnership in the form of selling materials into Olympic venues. The real opportunity is for Dow, and in turn the industry, to associate itself with one of the most recognizable symbols in the world.

The Olympic rings represent peace, unity, competition and a celebration of our common humanity. The association with the Olympic rings was the key selling point when Dow chairman and CEO Andrew Liveris and executive vice president of sales and marketing Heinz Haller pitched the sponsorship to the company's board of directors.

"We will use this opportunity to educate the public on how chemistry plays a role in the games, as well as improving society by being an enabler of modern life," said Liveris at a joint press event with the IOC at the Four Seasons Hotel in New York on July 16.

Photo credit: Dow Chemical

As we come upon the second quarter earnings season, the focus will be less on the results themselves, and more on what chemical companies are seeing and expecting at this critical juncture.

Fears of a double-dip global recession abound, driven by the European debt crisis and the resulting austerity measures by governments to balance their budgets. And concerns about a sharp slowdown in China's economy linger as that government aims to cool rampant speculation in its property market.

"Austerity" has made a big push into the financial lexicon these days, as noted by Paul Hodges, chairman of UK-based consultancy International eChem in the ICIS Chemicals & the Economy Blog.

Mentions of the dour term in the Financial Times shot up dramatically in May and rose further in June. Hodges sees the odds rising of entering the next phase of the downturn - a protracted affair.

But second quarter profits will almost assuredly come in strong, based on senior executive chatter at the American Chemistry Council (ACC) annual meeting in June, as well as positive guidance from European majors BASF and Arkema. CEOs of major chemical firms at the ACC meeting indicated that Q2 results were looking robust, and expressed optimism that the European debt crisis could be contained,

France-based specialty chemicals company Arkema expects record second quarter profits, while BASF indicated a better-than-expected Q2. Wall Street consensus estimates show US major Dow Chemical posting earnings per share of $0.58 in Q2 - up sharply from the $0.05 it earned a year-ago. And DuPont is expected to boost Q2 profits by 52% year on year to $0.93/share.

Purer-play US commodity chemical and polymers firm Westlake Chemical is expected to nearly double profits year on year to $0.50/share.

But going forward, the earnings comps will get much tougher. On the upcoming Q2 conference calls, analysts will be looking for any signs of a slowdown in momentum or trouble ahead. The impacts from Europe and China will feature prominently on the calls.

And in the US last week, the Federal Reserve indicated that the economic outlook has deteriorated a bit with a downwardly revised GDP growth forecast of 3-3.5% for 2010 versus its estimate of 3.2-2.7% in April, based on "economic developments abroad."

Most signs point to rough sledding ahead, but look for more clarity after Q2 results.

Photo credit: www.johnbatchelorshow.com

We are delighted to announce a major shift in focus and redesign of ICIS Chemical Business that will better help you to make critical business decisions.

We will provide essential information and analysis to help buyers and sellers in key chemical markets - not just reporting on prices, but what's driving those prices - in both the short term and the long term. Watch this VIDEO to hear more about the relaunch.

In particular, the markets where we can provide the most useful insight and analysis are in the upstream, bulk commodity tradable chemicals.

Through research, we've found that purchasing managers in a diverse set of industries that buy chemicals - including those in the specialty chemical industry - are focused primarily on upstream markets where they can get information on prices and what moves these prices.

This is where our strength lies, with more than 140 pricing, news and magazine reporters across ICIS worldwide - in New York, London, Houston, Singapore, Mumbai and Shanghai. We have unparalleled resources devoted to covering these chemical markets.

To bring you closer to key chemical markets, the new ICIS Chemical Business will have four weekly product sections - Petrochemicals, Polymers, Intermediates, and the fourth rotating between Inorganics/Oleochemicals and Biofuels.

We will also have a section on Energy and Feedstocks, as well as an expanded New Projects and Permanent Plant Shutdowns section, providing data and analysis on new activity.

You'll still get feature articles focusing on key macro trends and issues that effect supply and demand, and ultimately prices in these bulk commodity markets.

These revolve around key end-markets such as automotive, construction, packaging and consumer durables (white goods). You will continue to get CEO interviews on strategy, merger & acquisition updates, the latest in innovation, regulatory issues, and distribution and logistics.

Last but not least, we will have strong geographic coverage of regions that are becoming ever more important in the global chemical market, including Asia, the Middle East and Latin America.

We are confident you will find the new ICIS Chemical Business a useful tool to make business decisions. But please give us your feedback - we will always strive to make your magazine a better one.