LyondellBasell reported a slowdown in its propylene oxide (PO) and co-products sales in the third quarter, on modest demand and lower derivatives and export margins.
LyondellBasell's intermediates and derivatives segment reported operating incomeof $210mn in the third quarter, down by 65.5pc from $611mn a year earlier. This segment includes propylene oxide (PO) and derivatives and co-products derived from PO production, including oxyfuels (MTBE/ETBE), styrene monomer (SM) and isobutylenes.
The company did not disclose sales volumes for its PO business but did note difficult market conditions during the third quarter, as its PO and derivatives results decreased by $35mn from a year prior.
"Our propylene oxide and derivatives business encountered headwinds due to volatile prices for propylene feedstocks and volume impacts from Hurricane Beryl and planned maintenance," said executive vice president Kim Foley in an earnings call on Friday.
LydondellBasell's newest 470,000 metric tonnes (t)/yr PO and tertiary butyl alcohol (TBA) plant in Channelview, Texas, operated at nameplate capacity during the third quarter, the company said.
The company is continuing to target a 75pc operating rate in the fourth quarter for its intermediates and derivatives assets, as its Bayport, Texas, facility undergoes planned maintenance.
LyondellBasell expects softer seasonal demand in the fourth quarter, with second half results lower than the first half of the 2024. The potential for lower borrowing costs may drive recovery and PO demand from durable goods, the company said, but it does not expect markets to materially improve in the last part of the year.
The company's total operating income dropped by 23pc to $573mn in the third quarter from a year earlier.
