- Spot earnings are currently at R2.80/share for FY21 and have declined significantly on the lower oil price as well as significantly lower refining margins. Diesel cracks remain negative and petrol crack spreads have also turned negative in the week. We have also recently downgraded our earnings estimates (link)/
- While Asian polymer prices have increased in the last week, ethylene prices have come under pressure. Polypropylene prices are trending higher. US polyethylene prices have been steady but polymer traders report that markets have weakened (link).
Global chemical news
- Chinese private-sector firm Zhejiang Satellite plans to start up its 1.25mn t/yr ethane-fed cracker at Lianyungang in east China’s Jiangsu province in next year’s first quarter. It will be the first steam cracker in China fed purely on imported ethane (link).
- While Sasol reported on demand weakness in 1Q20, Stepan has reported strong demand for its cleaning and disinfection products. Stepan’s sales of surfactants increased by 11% and sales were higher in the US and Europe (link).