The international situation affects the petrochemical industry, and Formosa Plastics Four Treasures released its latest outlook.
[Reporter Zhang Huiwen/Reporting from Taipei] The US Democratic Party won the mid-term election, coupled with the changes in the Israeli Congress, the international situation is constantly changing. Formosa Plastics (1301), Nanya (1303), Taiwan Chemical (1326) , Formosa Plastics (6505) released its latest views on the operating outlook for the fourth quarter. Formosa Plastics and Nanya are optimistic that the fourth quarter will be better than the third quarter, Formosa Plastics is actively controlling inventories, and Formosa Plastics maintains the view that the refining spread will remain high.
Formosa Plastics pointed out that downstream processing plants have resumed work one after another after the Chinese National Day holiday, and the fourth quarter is the traditional peak season for petrochemical products such as PE, EVA, PP and AE. In addition, China continues to introduce economic stimulus measures, which is expected to drive increased demand for petrochemical products. In addition, the conflict in the Middle East has not stopped, and the prices of crude oil and raw materials ethylene and propylene have remained high, supporting the petrochemical product market. The operating rate and production and sales have increased compared with the third quarter. Therefore, the fourth quarter revenue is expected to grow compared with the third quarter.
Nanya believes that the trend of continued advancement of AI applications remains unchanged. Hardware development is gradually moving from single cabinets and cabinet groups to data centers. The required resources such as power and funds are quite huge, but at the same time, it also drives the spillover effect of business opportunities in various other industries. It has become an important indicator and development direction for countries to demonstrate their national strength. In the short term, there may be partial adjustments due to funding planning and local political and economic situations, but it is impossible to stop the development of AI. In the future, in addition to "high-end materials with circuit boards as the main axis", it will also lay out semiconductors, substrate process materials, specialty chemicals, composite materials, medical materials, low-carbon recycling products and comprehensive power solutions. This can reduce the short-term impact on individual industries and create long-term benefits and maximum value.
Taihua said that the US Democratic Party won the mid-term election on November 5, and the Israeli Congress changed. The conflict in the Middle East is unlikely to escalate further. Crude oil has dropped significantly. Existing raw materials and finished product inventories will suffer short-term price losses, and equity method income will also be affected. However, Taihua has always adopted low inventory operations, inventory losses are controllable, and upstream raw material prices have fallen. It will continue to purchase cautiously to minimize the impact.
Formosa Plastics said that Ukraine has resumed attacks on Russian refineries, and Russia has once again extended its ban on diesel exports. In addition, Saudi Arabia’s Ras The Tanura refinery was attacked and caught fire, and the German refinery was shut down due to a fire. As a result, Atlantic diesel supply and demand are still tight, and European diesel price spreads remain stable. However, diesel supply in Northeast Asia may be due to increased exports from China and South Korea, resulting in Asian diesel price spreads being limited, but still higher than the same period in previous years. As for gasoline, benefiting from tight light oil supply, light oil price spreads continue to be strong, maintaining overall light oil product spreads. The overall refining gross profit is still at a high level.
