Dow Chemical to Shut Three Louisiana Ethylene Plants (Update3)

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Published at: www.bloomberg.com

Ian DavenportPresidentDavenport Associates

One of many restructuring steps

July 6, 2009

Dow takes actions to get balanced. Situation worsens for others as a result. More closures will follow. This may smooth the way for new Middle East producers.

Dow and Other U.S. Petrochemical Companies Continue Their Long Term Move Offshore

July 6, 2009

Analysis by: GLG Expert Contributor

Dow's closing of their ethylene and derivatives plants in Hahnville, Louisiana is simply another move in the long term flight from domestic production which began in the early 1980s.  What the article implies is that Dow's move is the result of competition from foreign producers, but fails to mention that Dow (and all of the other major domestic petrochemical producers) are joint venture partners in these new ethylene complexes in the Middle East and Asia.  The petrochemicals previously produced in the U.S. and exported are now produced offshore (by U.S. company joint ventures) and imported to the U.S. and as we are now a net importer of oil, we will eventually become a net importer of petrochemicals.

Kevin BoyleConsultantKEVIN L BOYLE

After Dow’s Petrochemical Plant Closures – More Yet to Come

July 5, 2009

This plant closure will have no immediate impact on the ethylene market.  There may be additional rationalization coming in petrochemicals.  What may close in the future is a big gamble.