Ryan Barnes

Crosscurrents at Dow Chemical Make a Clear Forecast Impossible

I did leave out some of the Kuwait-Dow (K-Dow) venture, as there's limited information available thus far...

K-Dow is expected to be the #1 polyethylene producer globally from the outset. The JV is pre-loaded with plants and operating units, most contributed from Dow's existing cracker "inventory". Dow gets some needed vertical integration, and K-Dow should have permanent access to low-cost feedstocks.

The focus will be expansion into China, India, and Asia...from the company press release:

"About the Products in the Venture

The venture will manufacture and market polyethylene (PE), ethyleneamines, ethanolamines, polypropylene (PP), and polycarbonate and related licensing and catalyst technologies. PE and PP comprise more than half of world polymer demand. PE is the most widely used of all plastics and can be found in everyday products from food packaging, milk jugs and plastic containers to pipes and liners. PP is a versatile plastic used in fibers, packaging films, non-wovens, durable goods, automotive parts, and consumer applications. Polycarbonate is an engineering thermoplastic used in applications such as optical media, electrical and lighting. Amines are a family of chemicals with a broad range of properties, used in various applications from wood treating and pharmaceutical processing, to coatings and consumer products."

Dow will be monetizing $9.5 billion for their share of deal.