Chemical makers cut back amid uncertainty

The second quarter was a challenging one for US and European chemical makers. Sales crept up, but lower selling prices derailed the industry’s efforts to post substantive gains from a year ago. With expectations of sluggish business for the remainder of the year, chemical firms are taking matters into their own hands by cutting costs and trimming unprofitable assets and questionable projects. Results at the world’s largest chemical maker, BASF, were mixed. Sales declined by 6.9% from the prior-year quarter, but earnings excluding special items rose by 29.2%. “We saw a continuation of the dynamics of the first quarter, marked by positive volume momentum across most of our businesses,” BASF CEO Markus Kamieth says in prepared remarks. Lower selling prices for its products drove the sales declines. A bright spot for the diversified German company was its chemical business, which saw a 6.0% increase in sales driven largely by stronger