Formosa Plastics Group (FPG, 台塑集團), the nation’s largest industrial conglomerate, yesterday said aggregate sales by its four main units continued to dip last month amid falling international crude oil prices.
In addition, the outlook in the near term remains less promising, as downstream clients have maintained a cautious stance toward their inventory levels, the group said.
Last month, the group’s four major units — Formosa Petrochemical Corp (台塑石化), Formosa Plastics Corp (台灣塑膠), Formosa Chemicals and Fibre Corp (台灣化學纖維) and Nan Ya Plastics Corp (南亞塑膠) — saw their combined sales drop 15.6 percent annually and 9.1 percent monthly to NT$101.99 billion (US$3.04 billion).
Nan Ya Plastics led the decline, announcing that its sales last month slid 2.93 percent monthly and 22.6 percent annually to NT$21.15 billion.
The company attributed the decline to a strategic scaling back of ethylene glycol (EG) production that took place between Dec. 28 last year and Thursday last week, which decreased the company’s sales by NT$1.4 billion.
Meanwhile, the company said it also saw less revenues from plasticizer and bisphenol A (BPA) by NT$370 million in total.
Formosa Petrochemical said its sales last month declined 14.8 percent monthly and 15.1 percent annually to NT$42.06 billion.
The oil refiner said the decline came as global crude oil prices shed US$7.2 per barrel last month compared with the previous month, while its oil refining output last month averaged at about 533,000 barrels per day, about 9,000 barrels lower than December last year.
Volatile oil prices and lower factory utilization rate also caused shipments of Formosa Petrochemical’s olefin products to decrease last month to 640,000 tonnes from 690,000 tonnes in the previous month, the company said.
Formosa Plastics, the group’s flagship company and the nation’s largest producer of polyvinyl chloride (PVC), said sales last month declined 4.7 percent sequentially and 16.6 percent annually to NT$14.16 billion, as its production of ethylene vinyl acetate (EVA) was scaled back for maintenance to coincide with the expected lull in activities for the Lunar New Year holiday.
Formosa Plastics said its EVA shipments decreased by 10,000 tonnes last month from December last year, slashing sales by NT$460 million, while PVC shipments were 11,000 tonnes less than the previous month to affect sales by NT$300 million.
The company said it has cut product prices to reflect falling raw material costs.
Formosa Chemicals and Fibre, which produces aromatics and styrenics, said its consolidated sales fell 5.9 percent sequentially and 8.6 percent annually to NT$24.63 billion last month, due to falling average selling prices and planned production cuts.
The company said a decrease of 15,000 tonnes in shipments of p-xylene (PX) and o-xylene (OX) products last month affected sales by as many as NT$380 million, while a tendency among clients to hold back inventory procurement of phenol, acrylonitrile butadiene styrene (ABS), polystyrene (PS) and polypropylene (PP) products until the end of the Lunar New Year holiday also dampened sales by NT$220 million, the company added.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure