Listen to Mark and Victoria’s Conversation Here:
Navigating the complexities of the energy transition, Mark Eramo from S&P Global Commodity Insights joins Victoria Meyer to shed light on balancing consumer demand, policy alignment, and sustainability in the chemical industry. Mark discusses the challenges of producing sustainable products that consumers will pay premiums for and emphasizes strategic collaboration between policymakers and industry leaders.
Victoria and Mark converse about the transformative roles of diversity and AI in shaping the industry’s future, the effects of geopolitical uncertainties on supply chains, and the anticipation of a pivotal market shift by 2025-26. They highlight the intricate journey of corporate transformation and share insightful advice on leadership and career progression within the chemical sector.
Join us to learn more about the following topics this week:
- Mark Eramo’s career and industry engagement
- S&P Global Commodity Insights’ origin story and what it is today
- Lessons learned in leading companies through transition
- Biggest trends that are influencing the chemical industry today
- Leadership advice from Mark Eramo
Killer Quote: “One of the biggest challenges we face today is aligning policies, technology, and consumer demand to create sustainable products that consumers are willing to pay a premium for, without compromising business viability. It’s a fine line we must tread to ensure we don’t face unintended business consequences.” — Mark Eramo
Celebrating 40 years, the World Petrochemical Conference by S&P Global is the most prestigious global industry gathering for chemical innovation, insight, and collaboration. WPC has a rich history of providing unmatched market intelligence and convening top industry leaders and influential thinkers to discuss the solutions that will unlock pathways for growth and transformation. Join us in Houston, TX, March 17-21, 2025, to commemorate our 40th Anniversary!
Watch Mark and Victoria’s Conversation on Youtube Here:
Shaping the Future of Chemicals: Insights from S&P Global’s Mark Eramo
Hi, this is Victoria Meyer. Welcome back to The Chemical Show, Where Chemicals Means Business. Today, I have the opportunity to speak with Mark Eramo, who is now the co president of S&P Global Commodity Insights. Mark has been in the chemical industry for a long time, starting first at a producer and then quickly moving into insights and analytics and all the things that you know him for.
We’re just going to be having a great conversation today about his history, the role of insights and more. Mark, welcome to The Chemical Show.
Thank you, Victoria. It’s a pleasure to be with you today. I look forward to the conversation.
Absolutely. So let’s just start with your origin story. What got you interested in chemicals and ultimately led you to where you are today?
I appreciate the opportunity to tell my story. I’ll start with, as a kid who went into high school loving chemistry and math, and, also playing sports and doing everything else. But that led me to a chemical engineering degree from Cornell University, where I also played football. I like to point that out.
Good to know.
That led me to an opportunity to start with an operating company, Vista Chemical Company, in 1985. It actually was the assets that were spun out of Conoco Chemicals at that point in time. And I’m also very careful to point out that while I had the chemical engineering degree, I was not a practicing engineer, out of respect for those who do practice the art.
That degree set me up for a career in chemicals, and I’m glad I went down this particular path. I did a short stint with the operating company, “short stint” being 12 years, and then started with a privately held small consulting firm called Chemical Market Associates, CMAI, which became well known during the 80s, 90s, and 2000s. Before we then became, in 2011, acquired by IHS. IHS merged with company called Markit. So a short stint, say 2015 until the merger with S&P Global. That happened in 2022. I always say I’ve only worked for two companies, an operating company and a consulting analytics firm, but the names changed multiple times while I was with both. I also reflect on the fact that next year, as we’ll celebrate 40 years of the world petrochemical conference. I’m celebrating 40 years in this wonderful industry and I’ve really enjoyed being a part of this chemical industry.
Yeah! Number one, I think it’s a great heritage for WPC. 40 years of anything is quite a milestone. And then to your point, it is a great industry to grow up in. If you look around, many of us in many ways have grown up in the industry, right? You start in your early twenties and you keep on. I tried to escape it at one point, and that failed. So here I am continuing on in the chemical industry for my career as well.
Yeah, I always like to quote the late John Huntsman Senior. It stuck with me watching him at a conference during my operating chemical days where he used to say, “this is the industry that advances the human condition.” That stuck with me and I truly believe that, this is the enabling industry that makes the world better.
Yeah, I love that and that’s so true. So tell us a little bit about S&P Global Commodity Insights and who you are today, because you’ve already pointed out the transitions that you’ve gone through in your career and that these companies have gone through. So tell us more about who you guys are today.
Sure. Thank you for that opportunity. Cause not a lot of people can quite place Commodity Insights, especially under the S&P umbrella. So today S&P Global Commodity Insights sits as one of five divisions under the S&P Global brand. Some of the divisions that are maybe more recognizable, from a global perspective, there’s obviously S&P Ratings, the Dow Jones indices the S&P 500. There is S&P mobility, which is really all about the automotive industry and transportation. there is Market Intelligence, which is really where a lot of the financial analysis and forecasting occurs, as well as in the Ratings group. So between both Market Intelligence and Ratings, there’s a lot of economic analysis. And then Commodity Insights under the umbrella if you will, and the thing about Commodity is when we merged, IHS market merged with S&P Global in 2022. It was the S&P Global Platts division. So the largest, and one of the most successful PRAs in the commodity market space merged with the energy and natural resources division of IHS market.
Upstream analysis, gas and power, refining oil, chemicals, chemical feed stocks. agribusiness, shipping, freight analytics and forecasting. All of those things came together with Platts, which again, is the pricing entity and I should say pricing in editorial and news group. And that is what makes up Commodity Insights today is, all of those capabilities. So I would say, think of us today as benchmarks across a wide variety of commodities, news and editorial that wraps around that, which includes The Chemical Week piece, which we’ve retained that brand along with the Platz brand. And then a tremendous amount of deep analysis and forecasting.
So, in terms of my marketplace that I’m looking at and what does this mean for the future and whether your future is next week, or two years or 20 years for an investment case. We’re doing things in our business to help support the industry along those lines.
That is, I got to say, Mark, that’s really expansive. When I think about all the pieces of business that you now cover and now as co-president, you really have to wrap your arms around it.
Yes, it did. And I should mention that, I’m co-president with the gentleman, Dave Ernsberger, who has also 40 years of experience. And he started in the S&P family, if you will, many years ago, about the same time I started, but he came up through the benchmark and assessment side of the business. And I came up on more of the analytic side of the business. So we’re excited to be leading this team together into whatever the next chapter will bring for us.
Yeah. So, you’ve seen a lot of evolution in your career and where you are currently with S&P Global. What are your lessons learned when you think about managing and helping lead companies through transition?
Yeah, I actually get asked this question a lot because I’ve gone from a very successful, small, privately held, very focused, chemical industry consulting and analytics firm, to now I just described as a very expansive, large, publicly traded entity of five divisions and all the things that we’re contributing to. The things I like to contrast are the strength of that smaller entity privately held is nimbleness and decision making, right? It really comes down to can you be decisive in your decision making understanding where you want to play in the competitive markets and just playing to your strengths and basically making decisions as you need to along the way. But then the downside of being smaller is you may be somewhat limited in your overall resources and the way that you can scale your reach. It’s going to be a little bit more expensive. Flip side, you get into the large entity that scale and reach is really there in spades. In terms of the commercial capabilities we have, the marketing capabilities that we have, some of the things that I see from the S&P Global either corporate marketing or divisional marketing teams is just best in class of anything I’ve seen over the years. But then maybe the constraint becomes that nimbleness, because you are part of a larger entity. So what that comes down to is having the right leaders in a framework that those leaders can make decisions in and then pivot if you need to.
So really in both cases, it comes down to decision making in the larger entities. The most successful ones are the ones who can make fast decisions and pivot if they need to, because they’ve got that scale in that reach that they can provide. I’ll just add one more thing, whether it was the small entity or the large entity in this business, and you’ll know this, comes down to two things. Do you stay focused on your customers and what they need from you and focused on your colleagues, colleagues who are engaged and focused and really understand how they’re contributing to the bottom line again, whether it’s a small entity or a big company like S&P. If you’ve got that focus on colleagues and customers, I say you’re going to be successful and in terms of navigating transition, that’s the best advice I give any colleague is if you keep those two things at the forefront of your thinking. If you’re not quite sure of a decision, make sure you’re keeping your customers a priority, your colleagues a priority, and you’re probably going to be pretty safe in the decision you make.
Love it. Just thinking about your business, and I think this is part of this evolution. So now that you’re part of S&P Global, what’s different? What are you guys bringing to customers and the market today as part of Commodity Insights?
How would we recognize what you’re doing today versus what you’ve done in the past?
I’ll start on what I would call the core of our business, which again is really founded in our heritage, which is very large and successful price reporting agency that is deep in benchmarks and price assessments and so many commodity markets across the world in the editorial news that wraps around that. So for any given major commodity, where did that pricing sell? And what’s the news that wraps around that? And then on the other side of our business, we pick up where that team leaves off and come back to the, so what? And what’s this mean for me tomorrow? And so it’s the resources, that kind of bring a lot of data and analysis.
I tell our teams all the time now that there’s a competitiveness that’s playing out very well in the AI Developments, Gen AI and the use of tools that are really all about the ingestion of data, the modeling of data, and then providing that data to the client base so that they can do what they need to make decisions in a timely basis and make decisions with conviction about the information that we’re providing. It’s not that they’re necessarily following our advice, but we’re providing them a view that says because this is what happened, you might think about this commodity market trending this way or that way. The quicker we can do that is really becoming one of the keys to what we’re trying to do. We always maintain a view of the long term. Obviously that ties back into energy transition, into things that are happening around that to the marketplace.
There seems to be this need for decision making quickly and faster because things are happening so fast in the market today and the technology is changing on the AI front. So clients want and they need those opinions quicker than ever before in terms of, I think about in those early days at CMEI, we were updating a short term forecast once a quarter. Expectations are right now, if something changes, the client wants it tomorrow, “tomorrow” as quickly as they can get it.
The other thing I would add is, being part of S&P, I feel like we can bring resources to the table for our client base that we may not have had that capability to in the past, whether it be the economics team, whether it be our sustainable one team, which is really at the forefront of a lot of the sustainability and discussions that are happening out there in conversations around emerging technologies on energy transition. The thought leadership and the gathering of executives and policymakers that occurs at a Sierra Week as well as at AWPC. So these are all resources that we’re able to garnish and bring together and leverage to the clients that we serve on a daily basis. The challenge is to figure out what are the right resources to bring to the table because chances are we’re going to have it somewhere in the S&P Global portfolio, depending on what the challenges are that any given customer in this chemical space or chemical feed stocks or I like to call it the downstream industry, may have.
So as oil and gas gets processed and turned into product, the things that we can bring to bear on this are as good as I’ve ever seen. That’s what gets me excited about now leading the Commodity Insights division along with Dave is the resources are available. We just need to figure out the best way to bring those to our clients.
Makes a lot of sense. So how are your clients responding, because this is a lot of change for them as well. Big change for you and your colleagues. Big changes for your clients. How are they responding?
Great question. And thanks for asking that one again, because there’s no doubt with any major merger, there becomes this very challenging period of inward focus. You’ve got teams that need to be integrated, products that need to be integrated, platforms that need to be integrated, methodologies. And there’s an expectation from your customers that you’re going to get that done. You’re going to get that done quickly, and you’re going to come out with some clarity and bigger and better than ever before.
Yeah, and all in a week or something like that, right?
Absolutely. So, February of 2025 will be 3 years since the close of the merger.
3 years already?!
Exactly. 3 years.
Okay.
I would say that we’re not quite done. I say the integration and merger heavy lifting is done and we’re into what I call the polishing phase, because we’re not getting it all just right. I’ll be frank and open and honest about that. The best thing that hasn’t changed in the model that we provide our client base is access to some of the smartest people in the industry.
Those colleagues, those analysts who are doing the research, doing the forecasting and really involved in the marketplace are as available as they’ve ever been to the client base. But the platform and the actual look and feel of certain reports and the speed with which we bring things out. Yes, we are doing some polishing there still but it’s coming. And I’d say we’re 90% done. I think as we come into 2025, I’m really looking forward to kind of declaring integration and merger over, and now we’re on our way to just growth plans.
Absolutely. And I’ve personally been involved in a lot of different corporate transformations and whether they be via acquisition or whether they’re just an internal transformation that is about your internal company, but also about your customers. And the reality is they take several years.
It’s about this whole idea of keeping your eye on the prize for at least three years. We’d like it to be a much faster cycle. It’s not, especially when you’re dealing with thousands of people and hundreds, maybe thousands of processes and thousands of customers.
Right, yes.
It’s a long process.
Yeah. The hardest thing, and the thing that you need the most that we’re driving towards is what’s that new culture? When you bring these large entities together, what’s the new culture that you will create? One thing I’ll say about that is I do think Gen AI is forcing us to think and transform how we do what we do. That is helping also drive a new culture. because certainly as entities come together and mergers happen and smaller companies become larger and larger, there’s this heritage inertia that just exists. And you need a shock to get to a new inertia.
I think Gen AI is the shock to the system that will create a different kind of culture going forward as we rethink and transform the way we can do things because of Gen AI and the whole artificial intelligence side.
Let’s turn a little bit to just what’s going on in chemical markets today, because of course, you’re an expert and people always want to hear from experts. I guess I’m just going to keep it broad. What are you seeing? What’s the biggest trends that you guys are seeing that your customers are asking about, and that you see influencing the chemical industry today?
So the biggest weight on the industry has been this continuous over supply of various commodity markets, all companies are living and trying to figure out when does the pivot actually occur? That’s wrapped up in so many things around new builds, around scale of assets that are coming up, changing the build cycle. When you look at the fact that China can build much faster than we’ve maybe been accustomed to in the past demand in China, all things lead to China in any commodity market, right? In terms of demand and then the supply that may or may not be coming from China. Our analysis is saying, fingers crossed, if I’m a chemical industry person, 2025 hopefully represents a pivot point, 2025 or 2026 is where we start to turn some things around.
The supply and demand cycle of low operating rates and pressure on profitability, the market continues to be working its way through that and trying to figure out that. The added complexity with all of this is at the same time, the industry is being asked to decarbonize to deal with energy transition and what I would call the climate change era. It’s another dynamic that we’re in. I’ve got to take this hydrocarbon based asset that I have, and I have to inject some capital to lower my carbon footprint based on commitments that have either been made by the corporation or commitments that are being, if you will, demanded by countries in order for me to participate in various markets.
So now I have investments that aren’t necessarily accretive to my bottom line. But they certainly support a decarbonization profile while I’ve got a core business that is not got the best profitability. So I have to balance that capital. How do I keep the hydrocarbon business running while I invest in a greener business?
That is one of the themes that we have for The World Petrochemical conference next year is, how do I make investments for growth while I’m planning for a low carbon future? We’re saying, 40 years of success and now what do the next 40 years look like for the industry? And that is the challenge, I need to invest for growth because while we may talk about peak oil demand, we don’t talk about peak chemical demand, because the chemical industry is the mean by which the 8 billion people in the world have consumer goods, durable or non durable made for them, and we don’t expect that to stop anytime soon. So if those 8 billion people are going to need various levels of consumer goods, we think the chemical industry is the enabling force that makes that happen as it has been for so many decades. It will change in terms of how it does it but, that demand is still going to be there. So you’ve got to balance those 2 things at this inflection point in the industry.
So I would say those are the two big challenges. I’ve got an oversupply down cycle with low margins and a lot of pressure on me from stakeholders, whether they be policymakers or my own board of directors, to be able to say we’re doing everything we can for a low carbon future. That is a real tight rope for these companies to manage.
Yeah, absolutely. And then the added complexities of geopolitics, and the various wars that we’re seeing that reflect on supply chain challenges. Politics just in the sense of leadership changes, not just the U.S. but globally, we’ve seen an astounding number of elections this year. So there’s a lot of pressure and business uncertainties in the midst of some of these big strategic changes that you’ve referenced.
Absolutely.
So with that, what advice are you giving? If somebody said, “Okay Mark, that’s great and what should I do now?”
Some of the advice analysis is this conversation that it needs to occur. Let me back up a couple of things, from the fundamentals of the industry recognizing that demand is continuing to grow and how do I adjust to what I call a build cycle in an age of mea units, countries trying to really enable more crude to chemicals, more liquids to chemicals. I need to really get my arms around what that build cycle is going to look like. And what will be my participation in different countries or different regions be based on competitiveness? Do I think crude is going to stay high or is it going to go lower?
Is the Middle East and North America going to remain really competitive from a feedstock perspective as more and more demand comes on the liquid side of the business, whether it’s aromatics or olefins. And so there’s planning that. So really it’s having scenarios for the core of your business around what do you think is gonna happen on the energy dynamic, and how will that impact my build cycle and my capital investment planning for the future? On the other side of the equation again, in terms of energy transition, and this is of companies and policymakers working hand in hand to say, how do we make sure that the commitments we’re making and the investments we’re making are keeping up with the technology? And that the policies are also keeping up with the technology. And that we’re also building from the standpoint of making change in the products to what the customers are willing to accept and willing to pay for.
And so our advice is really just sound self serving. Let us help you get your arms around these different dynamics from geopolitics and policy making, versus what’s happening on the technology front, versus what are the consumers asking for and needing and wanting and willing to pay for. Being pragmatic about this thing called energy transition. Because if those three things don’t get in, get lined up, then what you do is you get unintended consequences, the dislodging of the demand side of the business. In other words, I go make a product that I need a premium for, but if nobody’s willing to pay the premium, then what am I going to do?
Companies are facing this right now. That’s the biggest conundrum that we’re in. It’s a chicken and egg scenario, right? We need more sustainable products. Who’s willing to pay for the most sustainable products and they’re not willing to pay. So then I’ve got to keep doing what I’m doing, and yet I need the higher value to fund investment. It’ll work out, but my guess is not as quickly as anyone would have hoped.
And the policy needs to be informed policy, the policymakers need to not stay in a vacuum, they need to bring industry to the table, to help solve these problems.
So Mark, let’s turn and talk a little bit about leadership and maybe leadership advice. You’ve had a really great career, 40 years in the industry. so I’ve actually got two parts. I’m going to start with part one, which is, what advice do you give to young engineers entering this industry that want to achieve your level of success?
I’ll reflect back on some of the mentors and coaches that I’ve had, or still have even 40 years into the industry, which is really be open, be flexible, in terms of opportunities that may come to you, in terms of using your skillset, understand how you wanna really apply your skillset. Then think about in terms of, especially in this world of being an analyst of the industry, in this segment that I’ve grown up in now since I left the operating world, is, do you want to be the expert of the industry? Do you wanna manage it? Or some combination of both? Do you want to be a player or coach? Do you want to just be that expert that everybody turns to for that advice? Or do you want to be the manager who’s bringing all the pieces together, because those are different things and the good Lord gave us 24 hours in a day and it’s probably good to sleep for a few of those hours. So you can’t be all things to all people. That’s one of the things that I was advised early on. One of my first roles at CMEI was being the ethylene guy. Do you want to be the world’s most renowned ethylene expert, or do you want to manage a group of people who are those commodity market experts? And there is the in between.
I call it players and coaches, Which was certainly doable. That’s one of the things I talk about with younger folks about more and more. You take reward in seeing those folks you’re managing be successful, right? So as you become more of a coach manager, what you’re really doing is it’s about putting the right athletes in the right position. So I always fall back to my football life. You want the right athletes in the right positions and taking pride in them, excelling in their game and, you being the one who manages that, or if you want to be the star wide receiver or the star quarterback or running back or defensive end, then that’s good as well.
And that’s where you wanna focus your efforts.
Love it. That’s really great. My part two of this is attracting people into the business, whether it be the chemical industry as a whole, or into S&P Global Commodity Insights, because again, you’re in a unique space that maybe a lot of people don’t know about. Chemists and chemical engineers, and I don’t really know what the profile is of your team necessarily.
How do you attract people into your business?
What one of my greatest learnings in making the transition from, I’ll say CMEI up to where I am today, is that you need a very diverse workforce from all walks of life. Our news and editorial and price reporting people are just as important as, I’ve got, Ph.D. chemical engineers who are doing third party assessments of industry technology. And those individuals are on opposite ends of the scale in terms of experience and education and the things that they’ve grown up with. But we need them all. We need everybody in between.
So in entity you tend just have certain profile, what you’re trying to do even in the business now, what we want to do is put people in front of clients who have an expertise in some grounding in that industry. I’m going to go talk to an executive of a chloralkaline industry. I want to put somebody in front of them who knows chloralkaline or polyethylene or benzene, whatever the case might be, but there’s a whole other ecosystem that supports it. And S&P is just a great example of that. We’re a large company. Tremendous diversity along all different measures of diversity and along all different skill sets. Placing an emphasis on what each individual brings to the table is really the key. because you think about, okay, the chemical team must be full of chemical engineers.
That would be my thought.
We have a lot of people with chemical engineering background in the chemical segment, but not all of ’em are chemical engineers. Not all of ’em are even chemists.
It does take a variety of backgrounds and you want that diversity because it does bring a richer experience and perspective to the table. That’s been one of my greatest learnings in this. And I think what S&P offers is that diversity of experience, diversity of individuals that they welcome into the tent and say, we’ve got all kinds of opportunities. Come join us. And we’ll find that right position on the playing field for you, based on your skill set and what you excel at.
Awesome. So what’s next for you? What’s next for S&P Global Commodity Insights?
So having one day removed from a pretty exciting announcement of now being co-president with Dave Ernsberger of the Commodity Insights division, that will also be merged with the Sustainable One group, with an emphasis on energy transition and sustainability becoming a bigger part of our portfolio as we look to 2025.
Dave and I, not only stabilizing things because it is another bit of management change that we want to make sure is stabilized, but really accelerating the growth that we have in our core analysis around the research and analysis that we’re doing in these core commodity markets, the benchmarking assessments that we continue to grow in really looking at what our offering is and make sure it’s crystal clear on the sustainability and energy transition front. Those are our big opportunities. in addition to the core of our business, helping clients understand what’s coming next, what’s in front of them, what are the decisions that they’re gonna have to make.
You will see all of this in spades on display at WPC in March of 2025 in Houston. Also what’s happening in Houston in March is the CERAWeek event, which is also a major energy event. So they are back to back, they’re different weeks this year, which is good.
Easier, better for you and better for the people that want to attend both.
Yes, exactly. So those are our themes. That’s where we’re focused. We’re excited about it. I’m excited about declaring merger and integration over and just getting on with the growth story and focused on our client base and how we can help them best.
Yeah. Sounds really great. Thank you, Mark. Thanks for joining me. I’ve loved this conversation. I know others will as well.
Thank you, Victoria. I appreciate the opportunity and great conversation. Thank you very much.
Yeah, absolutely. And thank you everyone for joining us. Keep listening, keep following, keep sharing, and we will talk with you again soon.
About Mark Eramo:
Co-President, S&P Global Commodity Insights
Mark Eramo is co-President of S&P Global Commodity Insights and a member of S&P Global’s Executive Leadership Team.
Most recently, Mr. Eramo was Head of Fuels, Chemicals & Resource Solutions business line for S&P Global Commodity Insights. In that role, he had P&L responsibility and manages a global team of 450 research colleagues, located in all major regions delivering information, insights, and forecasts regarding crude oil, refined products, NGLs and chemical feedstocks, chemicals, agriculture commodities, and freight and commodity shipping analytics.
Prior to that, Mr. Eramo served in various roles over the past 20+ years overseeing downstream industry research and business development teams for IHS Markit and predecessor companies. Before entering the consulting and analysis business, he worked for more than twelve years in the chemicals production industry.
Mr. Eramo holds a Bachelor of Science degree in chemical engineering from Cornell University, where he also enjoyed playing American football for the Big Red. Mr. Eramo and his wife have been residents of Houston, Texas, since 1991, where they recently celebrated becoming grandparents.