Michael Leithead: Great. Thank you. Good morning, guys. My first question on PEM and maybe sticking on the last topic. Your slides talk about competitively priced exports out of China for epoxy and when you sort of do the back of the envelope math, it seems like producers there are selling export products below cash breakeven levels, so how do you think this dynamic or down cycle plays out? And does it change at all how you approach…
Albert Chao: Certainly, some of the Chinese — depending on the industry, definitely in the integrated ethylene to polyethylene, our information shows that in to the present China based on naphtha cracking are losing cash, whereas the US integrated players are still based on ethane feedstock ethylene up, we still have very good cash margin. So — but in business like epoxy, where they have built additional capacities. Some of the Chinese plants are running below 50%. And some new plants have not started up – idle and starting up. So I think companies are adjusting to the new dynamics. And over time, they should make the right decisions, what to do with their businesses.
Michael Leithead: Great. That’s super helpful. And then maybe just a follow-up on HIP, could you maybe talk to the different product lines or categories within the segments you can obviously fairly decently tracked the moving pieces you doesn’t have so such within the HIP, what areas perform, say, better or worse relative to the overall segment this quarter?
Albert Chao: Yes. So we saw a broad strength across really the portfolio. So strength really in our businesses, such as stone, siding, roofing, of course, pipe for storing wastewater applications, so a broad application really in what we would call the Westlake Royal building products business as well as our pipe and fittings businesses. So broad strength in all of those businesses within the HIP business really made nice contributions in the second quarter.
Michael Leithead: Okay. Thank you.
Albert Chao: You’re welcome.
Operator: Thank you. One moment, please. Our next call comes from the line of Matthew DeYoe from Bank of America. Please proceed.
Matthew DeYoe: Good morning, everyone. What percent of China’s PVC production do you suspect they’re exporting right now?
Albert Chao: Yes, China used to be importer of PVC. And I think they have been exporting – their export is 80% of the Chinese PVC are produced from a carbide process usually — so the quality is not a great. And I think India has put a VCM, VCM monomer level on import PVC and some of the Chinese producers are not able to meet it. So I think the PVC export volume has reduced from China. But nevertheless, it does has an impact on those markets, primarily export into – there was South Asia and Southeast Asia as the main market.
Matthew DeYoe: Do you have a number, I guess, Steve, when we’ve talked in the past, I think you had said you expected it to be — or you thought it was around 20%. I’m assuming to Albert’s comments, it’s less than that now. But — and is it 10%? Is it 5%? Is it 15%? Do you have any idea?
Steve Bender: Yeah, it’s meaningfully lower than that 20%.
Matthew DeYoe: Understood. And if I can, what was your mix of import versus exported product shift for caustic and PVC in the quarter? And do you expect it to change meaningfully next quarter with when you get your capacity back?
Steve Bender: Yeah. And so when you think of the exports that we have both in caustic and PVC, the industry is exporting in the 20% range, and we’re just below that a number. And from a PVC perspective, the industry has been exporting historically in the 30s. And so we’re also below that threshold number as well, because remember, PVC is going into our building products business. So we have a pretty good domestic consumption number internally for our own PVC.
Matthew DeYoe: Understood.
Operator: Thank you. One moment please. Our next question comes from the line of Matthew Blair with TPH. You may proceed.
Matthew Blair: Hey, good morning, Albert and Steve.
Albert Chao: Good morning.
Steve Bender: Good morning, Matthew.
Matthew Blair: Could you share any more color on the $50 million outage impact in PEM in Q2. What assets did that impact? And were they fully back up and running by July 1st, or do you expect anything to roll into Q3? And then also, are there any plan turnaround for Q3 or Q4 that we should be keeping in mind?
