Luis Rojo: Great question, Mike. And as we mentioned in our prepared remarks, we are still expecting destocking in Ag to continue in the first half, and we’re expecting a revamp of the Ag business in the second half. And so that’s one of our key drivers. Second, I will say, the $50 million productivity program already kicking, but you are going to have a gradual ramp up of that program, so you should expect to deliver more savings in the second half than in the first half. And the third thing that I will say, of course, Pasadena is one of our key building blocks for the second half and for 2025. Still, starting off the plant is not going to be all positive at the beginning. You need to spend some money. But those are the three big building blocks that we see.
And of course, I mean, you know that we have a seasonality effect on the polymers business, where typically Q2 and Q3 are stronger with all the construction activities. So that skew there means that it will be done in more in the second half.
Scott Behrens: And Mike, I would also just point out the underlying core business outside of those specific initiatives that we just went through, has demonstrated sequential growth in Q4. So distribution, I&I, polymers, that will continue to — should continue to incrementally grow through the quarters going forward. But really, the second half of the year is when our new assets come online in Pasadena. And as we said, that’s when the Ag destocking is supposed to subside.
Mike Harrison: All right, very helpful. Thanks very much.
Operator: Thank you. One moment for our next question. Our next question comes from Vincent Anderson with Stifel. Your line is now open.
Vincent Anderson: Yes, thanks. Good morning, everyone. I wanted to follow up on a couple of Mike’s questions. I think first and foremost, I was hoping to get some more context on agriculture, but really more your confidence in a second half recovery, given we’re still seeing a lot of pressure in Brazil on both the safrinha corn acres and then just overall farmer financial positions?
Scott Behrens: Yes. So, Vincent, the good news is the macro trend is there. And if you’ve been reading some of the downstream agricultural companies, the demand in the field remains. So this truly is the destocking activity that we’re going through right now. I think, and again, what we’ve had read and talked to with our customers, the second half is when we should start to see the improved volumes. Now, the rate of that ramp up and the geographical cadence of how that happens, I do think you’re right, Brazil could be probably the slowest to recover and work through that destocking, but our Ag business is global in nature. North America, Europe, and Asia are all important for us. So we have good anticipation that we’ll start to see those volumes recover in the second half.
Luis Rojo: And this is a 100% in line with the feedback that we’re getting from our customers. I mean, this is a 100% in line with their focus.
Vincent Anderson: Okay. It’s good to know. I just called out Brazil because I think you pointed to that as a specific area of pressure recently, but no, that all tracks. And then kind of going back to the Latin American business, I think you kind of framed it as imports were incentivized by supply chain disruptions, but if I recall, those were Chinese imports that can be tough to compete with once they kind of get a toehold in. So are you comfortable with where you’re running those assets from a margin perspective right now? Or if the imports don’t play nice, let’s say, is there more room for you to compete being a domestic supplier? Or is this something that you’re going to have to continue to monitor pretty closely?
Scott Behrens: No. I think we feel pretty good, Vincent. As Luis mentioned, with that inventory hangover in the first half of last year, we were chewing through high-cost raw materials, which really impacted margins as we competed in the domestic market down there. But all things equal, our customers prefer to buy from local supply. And when raw material valuations are matching where market pricing is, I think we’re going to win that game. And I think our Q4, where we reported double-digit volume growth is demonstrating that. But we expect that to continue quite frankly. But yes, margins can always improve. We’re not happy or pleased with where the margins are currently at in Q4, but we expect those to continue to improve as we go forward.
Vincent Anderson: All right, excellent. Good to hear. And then I’ve just got two really quick ones. You mentioned the biocide business being a little bit of a headwind. Does that just continue de-stocking, or is there maybe some customer concentration on that portfolio that’s creating one-off headwind?
Scott Behrens: Yes, it was really customer concentration and just rolling off some of the COVID types of activity and business that came off in Q4 of 2022.
Vincent Anderson: Okay. Thanks. And then last one is just anything remarkable to report on the annual Polyols negotiations this year?
Luis Rojo: No, nothing new to report now. Nothing new to report now, Vincent. You know it’s a very competitive business. We are good margin stewards in the marketplace, and we will continue protecting volumes of margins.
Vincent Anderson: All right. That’s all from me. Thanks, guys.
Operator: Thank you. One moment for our next question. Our next question comes from David Silver with CL King and Associates. Your line is now open.
David Silver: Yes. Hi. Good morning. Thank you.
Luis Rojo: Good morning David.
