Price gains, especially for plastics, fuelled the Q4 2010 performance of Dow Chemical (Midland, Michigan / USA; www.dow.com), the chemical giant said in its report on the quarter and full year 2010. In commodities, these represented a price component of 16%. Altogether, Dow said quarterly price gains outpaced a USD 685m increase in feedstock and energy expenditure. Group-wide EBITDA excluding certain items rose 30% to USD 1.9 bn. Equity earnings of USD 313m (up 43% year-on-year) contributed in particular by affiliates Dow Corning, MEGlobal and the Equate joint venture in Kuwait, hit “an all-time quarterly record.” Full-year group sales increased 26% year-on-year to 53.7 bn, and EBITDA by 36% to USD 7.5 bn.

Plastics, Dow’s largest operating unit, saw EBITDA increase to USD 765m in the fourth quarter, up from USD 548m in the 2009 period. The figures include a USD 5m charge related to the divestment of styrenics/PC business Styron (Midland, Michigan / USA; www.styron.com) – see Plasteurope.com of 21.06.2010 – in June 2010. Quarterly sales rose 20% to USD 2.9 bn. All of Dow’s 2010 figures have been adjusted to exclude Styron. Altogether, the group reported a net loss of USD 17m on the transfer of 62.5% of this business to an affiliate of Bain Capital.

Dow’s Performance Systems segment saw its Q4 EBITDA increase by 33% to USD 198m, with the figures including a USD 9m asset impairment and a USD 8m charge related to the Styron divestment. Sales rose by 17% to USD 1.6 bn, thanks in part to a “double-digit” improvement in volumes at Dow Automotive Systems, which was led by strong demand in North America, and a demand increase of more than 20% for PU foams and systems formulations. Sales growth in elastomers was boosted by volume increases in Europe, the Middle East and Africa. North American expansion was in particular driven by a “significant rebound” in demand for insulation products.

Performance Products, which includes polyurethanes, saw its Q4 EBITDA fall to USD 264m from 303m, due partly to a USD 13m Styron-related charge. Sales improved by 23% to USD 2.7 bn. The group said polyurethanes saw a strong sales increase, with volume gains across the business. It noted that demand growth was recorded in all geographic regions except Asia-Pacific, where price increases were implemented to recapture margins.

In the Chemicals and Energy segment, which includes the chlorine/PVC chain, EBITDA surged forward to 173m from USD 20m. Sales rose 13% to USD 932m. Dow said volume decreases of more than 3% were more than offset by price gains of 16%. Sales of vinyl chloride monomer (VCM) were boosted by exports that helped offset continued weakness in the US building sector.

Looking ahead to 2011, CEO Andrew Liveris said one of the Dow’s goals is to “further tilt the plastics franchise toward higher-margin, specialty applications.” By mid-year, the group hopes to make a decision on the planned joint venture with Saudi Aramco (Jubail / Saudi Arabia) at Ras Tanura / Saudi Arabia – see Plasteurope.com of 03.11.2010. Around the same time, Liveris said he expects a “favourable outcome” of the arbitration proceedings on Dow’s USD 2.5 bn damage suit against Kuwait’s Petrochemical Industries Company (PIC, Sabahiya; www.pic.com.kw) over the failed K-Dow commodity plastics joint venture – see 09.01.2009.

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