Surfactants demand in oilfield, agriculture expected higher – Stepan

HOUSTON (ICIS)–Demand for surfactants within the agricultural and oilfield markets is expected to exceed prior-year demand, US-based Stepan said in its Q3 earnings call.

With crude oil prices in the $80s/bbl and natural gas prices expected to be 27% higher than last winter, oilfield activity has increased throughout 2021, increasing demand for commodities such as surfactants and triethylene glycol (TEG).

In agricultural applications, high commodity prices and a favourable currency impact on exports are driving increased planted areas of major crops in Brazil, the company said.

In North America, high commodity prices for corn and soybeans, as well as increased planted acreage for the 2021 growing season, drove strong crop protection sales, Stepan said.

In another key end-use for surfactants – cleaners, disinfectants and personal wash products – the company expects its volumes used in industrial and institutional applications to grow year on year in Q4.

However, this is unlikely to compensate for lower consumer volumes, said CEO F Quinn Stepan.

The company also expects surfactant volumes in the North American consumer end markets will continue to face raw material and transportation constraints.

Lower consumer product volumes from the pandemic peak in 2020 were partially offset by strong growth in industrial and institutional cleaning, the company said.

The company estimated that supply-chain disruptions accounted for an approximately $4m decrease in North America surfactants operating income.

Improved margins, product and customer mix offset decreased global surfactant sales, Stepan said.

	vs Q3 2020
Surfactant net sales	+16%
Surfactant operating income	-16%
Selling prices	+20%
Global sales volume	-6% (vs Q2 2021)

Stepan products are used in a variety of sectors, including coatings, adhesives, sealants and elastomers; construction; cleaning; insulation; oilfield; and personal care.