Global Chemical Industry Billion-Dollar Club Rankings Released

Recently, Chemical & Engineering News (C&EN) released the Billion-Dollar Club list. The ranking shows that in 2024, leading companies in the global chemical industry generally experienced a decline in revenue, but the decrease was narrower than last year, and the rankings have remained relatively stable in recent years. However, from a long-term perspective, the overall downturn in the chemical industry has not changed.

To this end, industry giants are still actively making adjustments to improve profitability.

The ranking structure continues a stable trend.

In 2024, the global landscape of leading chemical companies continued its recent stable trend. According to the rankings, based on annual revenue, BASF has topped the Chemical Week's Billion Dollar Club list for the sixth consecutive year. Since 2015, except for the brief merger of Dow and DuPont, which formed an industry giant from 2017 to 2018, BASF has consistently held the top position. Ranked second is China Petroleum & Chemical Corporation (Sinopec Group), while Dow has surpassed Formosa Plastics Group to rise to third place. The latter half of the top ten continues to feature familiar names such as LyondellBasell, Rongsheng Petrochemical, Saudi Basic Industries Corporation (SABIC), ExxonMobil, and INEOS.

The biggest change among the top ten is the entry of China National Petroleum Corporation (fourth place) and the exclusion of China National Chemical Corporation. Chemical Weekly stated that this is due to differences in information disclosure. Additionally, large chemical companies such as Koch Industries, TotalEnergies, and Reliance Industries have not disclosed their chemical revenue data.

The lower segment of the ranking also shows stability: companies such as Linde, Air Liquide, Mitsubishi Chemical, Canada's Nutrien, Wanhua Chemical, Bayer, and Sherwin-Williams consistently rank among the top 25. Some companies have experienced significant ranking fluctuations, with Tongkun Group rising 9 positions and Hengyi Petrochemical dropping 13 positions. Indian agrochemical company UPL and European specialty chemicals company DSM-Firmenich have seen their rankings rise, while lithium giants Albemarle and Chile's SQM have plummeted 29 and 31 positions, respectively, due to prolonged low lithium prices.

The prolonged low cycle prompts chemical companies to accelerate adjustments.

The year 2024 marks the third consecutive year of downturn in the chemical industry. In its annual report released in April, BASF pointed out: "Although the global chemical industry growth rate (3.9%) is higher than the overall industrial level (2.7%), growth in Europe weakened in the second half of the year. Capacity for basic chemicals in Europe continues to shrink, and this trend will intensify further in 2025." Dow CEO Jim Fitterling stated: "Europe remains the region with the highest global costs, demand is 20% lower than before the pandemic, and companies are accelerating consolidation to adapt to local demand."

Industry leader BASF is not only shutting down facilities but also asset sales. At the beginning of the year, it sold its decorative coatings business in Brazil to Sherwin-Williams, and the remaining coatings business is currently receiving multiple offers. Additionally, it plans to spin off its agricultural solutions business. If the sale of the coatings business and the IPO of the agri-chemical segment are completed, BASF's sales in 2024 will drop to $56 billion, falling behind Sinopec. Furthermore, BASF will also make strategic adjustments to its environmental catalysts, battery materials, and other businesses.

In 2016, the long-established company DuPont was among the top 10 in the billion-dollar club, but its ranking has continued to decline, and it is ranked 36th in 2024. After the spin-off of its electronic business Qnity and the sale of its aramid business, the remaining businesses will have an annual sales revenue of less than $5 billion, potentially dropping out of the top 75.

Revenue decline narrows, profitability rebounds.

Although the chemical industry’s revenue generally declined in 2024, the rate of decrease narrowed significantly compared to 2023. This aligns with the judgments of industry executives and analysts: the chemical industry has been in a prolonged downturn since the end of 2022 or early 2023; although there has been no substantial improvement so far, the downward trend has begun to ease.

The median sales decline for the Billion Dollar Club companies in 2024 is 1% year-on-year, with median sales dropping by 4% to approximately $8.81 billion. Although the performance is not optimistic, it is significantly better than the 10% median decline in 2023. Among the 106 companies on the list, 53 experienced a decline in revenue, 12 remained stable, 40 saw growth, and 1 could not be compared. There were few companies with significant revenue fluctuations; only 7 companies achieved double-digit growth, while 9 experienced double-digit declines.

In 2024, the chemical industry's profitability shows signs of recovery, with a median year-on-year growth rate of 4% in operating profit. Among the companies with available year-on-year data, 49 saw an increase in operating profit, 38 experienced a decline, and Shin-Etsu Chemical remained stable. This trend reverses the industry's downturn in 2023 (median decline of 25%) and 2022 (median decline of 2%). Companies like BASF are addressing environmental challenges through measures such as cost-cutting, saving 1 billion euros in 2024.

Data shows that the proportion of capital expenditure and R&D investment of companies on the list remains stable, with median companies' capital expenditure and R&D investment accounting for 8% and 2% of sales, respectively, consistent with historical averages. However, companies such as Dow and LyondellBasell have announced plans to reduce capital expenditure by 2025.