SASOL, the JSE-listed petrochemicals giant, has delivered its production targets in the year ended June 2021 despite the Covid-19 pandemic and adverse weather conditions, it said in a statement yesterday.
Total chemical sales volumes were only 3 percent lower compared to the prior year and largely in line with previous market guidance of between 2 and 4 percent lower, Sasol said. This was despite adverse weather events in both the US and South Africa impacting production, the divestment of the US Base Chemical assets and the continued impact of the Covid-19 pandemic.
The American chemicals assets grappled with two hurricanes and an Arctic winter storm, which had a combined impact of 300 000 tons, Sasol said.
Sales volumes for the chemicals Africa business were 1 percent higher compared to the prior year despite the ongoing Covid-19 global pandemic and a power outage at the Sasolburg site caused by a severe storm at the end of December 2020, with a total impact of 80 000 tons.
Sasol declared force majeure on a number of products, including solvents, wax and polymers within the performance solutions and base chemicals divisions.
“The force majeure on all products has been subsequently lifted, with the exception of wax where the force majeure is expected to be lifted in the first quarter of the 2022 financial year,” said Sasol.
It said total chemicals external sales revenue for the financial year had improved by 13 percent with the average sales basket price 17 percent higher compared to the prior year. Average basket prices increased 10 percent in the fourth quarter of the 2021 financial year.
“The higher prices were due to a combination of improved demand, higher oil prices and reduced market supply resulting from the weather-related events in the US and global supply chain challenges due to the continued Covid-19 pandemic,” said Sasol.
Sales volumes in Chemicals America were 37 percent higher in the fourth quarter of the 2021 financial year compared to the previous quarter as the ethylene crackers produced close to nameplate capacity. Sasol delivered 7.6 million tons in production volumes at its Secunda Operations, in line with market guidance, and shifted more volumes to chemicals.
Sasol said at Natref, together with
its partner, the group had reduced its run rates to respond to lower market demand. The group said the business benefited from a stronger demand for liquid fuels and gas as Covid-19 restrictions were eased.
It continued to strategically target margin maximisation by placing its products in the highest yielding channels and opened 10 new retail convenience centres (RCC) this year.
“We are monitoring demand for liquid fuels as the South African economy is hampered by the third wave of Covid-19 and the political unrest in mid-July.
“Our production facilities were largely unaffected by the unrest. However, a handful of our RCCs in KZN and Gauteng were damaged. Some challenges were experienced with the supply of product to our RCC network due to road network disruptions, but have subsequently been resolved,” said Sasol.
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