Mr Shengxiao is considering closing more factories

Us engineering materials and styrene producer Sensio warned on Tuesday that it was considering closing more plants as it reported a net loss in the third quarter, foreign media reported.

Mr Trinseo said results in the third quarter were negatively affected by several factors. Historically high natural gas prices resulted in negative European styrene profits throughout the quarter; Very low customer demand in Europe and Asia, particularly in consumer durables and construction applications; In addition, the sharp decline in raw material prices led to a large reduction in inventory, mainly polystyrene (PS), acrylonitrile butadiene styrene (ABS) and polycarbonate (PC). Net income and adjusted EBITDA for the third quarter also included one-time pretax charges of approximately $23 million related to raw material contractual obligations and write-downs of unmarketable inventory.

Trinseo may take the following steps:

1. Trinseo is now considering closing its styrene plant in Pollan, Germany, because it has been losing money for the past few quarters. The company has begun talks with the German trade union Sensio about a possible closure. Once the plant is closed, the styrene required by Trinseo's downstream operations will be sourced entirely from production at its Terneuzen plant in the Netherlands, as well as from external sourcing. In the 12 months ended June 2022, the profitability of the Boehlen plant was about negative $30 million.

2. Trinseo is currently evaluating steps to optimize the production and supply chain of polycarbonate (PC) and downstream PC compounds. As part of the review, the company has begun discussions with the plant's works committee about the possibility of closing a PC production line at the company's Stade facility in Germany, which would reduce costs and significantly reduce the risk in the cyclical commercial PC market.

3. Due to overcapacity in Europe, the company plans to reduce its styrene butadiene latex production capacity in Hamina, Finland, from January 2023.

4. In North America, Trinseo is evaluating the restructuring of its polymethyl methacrylate (PMMA) sheet business.

Bozich, President of Trinseo, said: "Despite challenging macroeconomic conditions, our current liquidity position and history of strong cash generation give us confidence in our ability to continue to invest in our growth and sustainable development goals. At the same time, we are evaluating measures to improve our cost position and optimize our global asset footprint to be better positioned when market conditions improve."