SSL.US, an international integrated chemical and energy giant from South Africa, said before the US stock market on Thursday that it expected price and demand fluctuations in chemicals to continue into the second half of the 2024 fiscal year, mainly because global market sentiment and petrochemical market demand remained uncertain, so the company's chemical demand and profit margin outlook for the second half of 2024 is expected to remain low.
Headquartered in South Africa, Sasol is an integrated chemical and energy company for the international market, mainly engaged in the extraction and processing of oil and gas and the production of important chemical products. Sasol is known for its leading position in liquefied natural gas (LNG) and technology for converting coal and natural gas into liquid fuels and chemicals. These technologies are often referred to as coal to oil (Coal to Liquids, CTL) and natural gas to oil (Gas to Liquids). GTL). Sasol is also responsible for the production of a variety of important chemical products, including polymers, solvents, chemicals and fertilizers, and occupies an important position in the global chemical and energy fields.
Sasol said South African suppliers and major customers in South Africa continued to face business disruptions because of the challenges faced by South African National Power Company (Eskom) and Transnet. Mr Sasol said that while the previously communicated production and sales guidance for fiscal 2024 remained unchanged for all departments, ORYX GTL utilization was expected to range between 65 and 75 per cent due to the challenges experienced in the second quarter of fiscal 2024.
Sasol pointed out that total chemical sales in the first half of fiscal year 2024 (as of December 31, 2023) were 4% higher than in the first half of fiscal year 2023, mainly due to an increasing trend in ethylene and polyethylene sales to the US market. and the gradual improvement in production and supply chain performance in Africa.
However, the global chemical and energy giant said it was still difficult to predict sales of chemicals in Eurasia against the backdrop of a challenging macroeconomic environment. "sales of chemicals for Eurasia are still expected to fall by 5 per cent to grow by 5 per cent (- 5 per cent to + 5 per cent) in fiscal 2024 compared with fiscal year 2024, and overall demand in the region is expected to begin to recover in the second half of fiscal 2024."
Sasol further said that global macroeconomic weakness, particularly in Asia and Europe, continued to put tremendous pressure on its chemical business. "the pace of customer destocking has had a negative impact on global demand, which is similar to what our global counterparts are experiencing." Sasol said.
In Sasol's mining business, productivity in fiscal 2024 is expected to remain between 975 and 1100t/cm. However, due to the company's challenging performance in the second quarter of fiscal 2024, Sasol said it was likely to reach the low end of this guidance range. "specific performance in the second quarter of fiscal 2024 may also have a negative impact on our unit cost per tonne of mining in fiscal 2024."
At the same time, Sasol's liquid fuel sales fell 1% in the latest quarter compared with the same period last year due to a glut in the diesel market in South Africa. Source: Zhitong Finance and Economics