Chemicals Sector Q4 2023 Update and 2024 Outlook
The fourth quarter of 2023 continued to prove a challenging environment for the chemical industry in a year that was characterized by significant macroeconomic and geopolitical headwinds, unprecedented inventory levels across end markets and unpredictable demand weakness that put downward pressure on volumes and prices. Companies across the chemicals value chain focused their efforts on levers which they could control: disciplined cost reductions through overhead eliminations, plant shutdowns, performance improvements and portfolio optimization. Inventory destocking, which began in late 2022 and has mostly returned to normalized levels across industries, was also a significant focus in 2023. The overwhelming sentiment of chemical executives is that businesses are streamlined and well-positioned for a recovery, whenever that may occur.