MOSCOW (MRC) -- -Trinseo's sales volumes have stabilised at levels that are 20% below typical mid-cycle levels, said the company.
So far, demand in the third quarter is similar to that in the first half of the year, said Frank Bozich, CEO. He made his comments during an earnings conference call. The company continues to see lower demand across many applications, particularly in building and construction as well as consumer durables, he said. Consumer demand remains soft and Trinseo's customers continue to destock.
Trinseo did see pockets of relative strength, such as for products that contain recycled content and those used in coatings, adhesives, sealants and elastomers (CASE). Even though Trinseo is headquartered in the US, more than half of its sales are in Europe, making it vulnerable to the disruptions that region has suffered from higher energy costs caused by the war between Russia and Ukraine.
Higher energy costs have made European producers less competitive against much of the world, Bozich said. Already, Trinseo is shutting down a styrene plant and a polycarbonate (PC) line in Germany to lower costs.
It is in talks to shut down its last styrene plant, in the Netherlands, because it makes more sense for Trinseo to buy the material instead of produce it in Europe.
In addition to higher energy costs, lower demand from China has also dragged down European profits, Bozich said. The company has lowered its forecast for Chinese growth from that it made six months ago.
We remind, Trinseo, a specialty material solutions provider, announced the inauguration of its polycarbonate (PC) dissolution pilot facility in Terneuzen, the Netherlands. The new pilot facility is a major step in Trinseo’s commitment to sustainability, part of the journey in realizing the company’s sustainability goals. The guests of honor at the inauguration ceremony included Jo-Annes de Bat, Provincial Executive (responsible for regional economy) of the Netherlands.