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POPOFF DESCRIBES RESPONSE TO COMPANY'S CHALLENGES AT 96th ANNUAL MEETING OF DOW STOCKHOLDERS

 MIDLAND, Mich., May 13 /PRNewswire/ -- Frank Popoff, chairman and chief executive officer of The Dow Chemical Company (NYSE: DOW), today reviewed for stockholders economic, industry and regulatory challenges facing Dow and the strategy the company is implementing to manage them.
 Speaking at Dow's 96th annual meeting in Midland, Popoff said, "Driving the economy are declines in industry, government and consumer spending. All industry is facing much more than a temporary economic downturn and spending isn't likely to return to the levels of the late 1980s."
 Popoff told shareholders that the chemical industry has suffered from these global economic challenges and compounded its problem by overbuilding. He added, "The industry's expansion has led to oversupply and resulted in lower prices and margins."
 The result for Dow was described as falling prices, including declines of 4 percent in 1991 and 3 percent in 1992. Lower prices cost Dow $1.3 billion in earnings in those years -- the equivalent of Dow's operating income for 1992.
 A regulatory challenge with significant impact on Dow's 1992 financial performance was an accounting change related to rising health care costs. This new standard led to a charge against Dow's earnings of almost $1 billion, leading to a net loss of $496 million or $1.83 per share.
 "This charge resulted in losses totaling $70 billion for the 25 largest U.S. manufacturing companies," Popoff said. "The initial accumulated liability for all of corporate America is expected to be as much as $2 trillion."
 Popoff added that the charge caused Dow's loss in 1992, but did not impact the company's cash flow.
 Discussing expectations for the future, Popoff said that he believes 1993 will act as a transition to growth for Dow. He added, "This transition is likely to include improved economic conditions and price increases for the chemical industry. But, we just can't wait for that transition to run its course and have taken specific steps to maintain our financial flexibility and enhance profitability now."
 Dow's response has featured major productivity improvements, investing in technology for growth and diversification while emphasizing an aligned and motivated work force.
 Popoff said that Dow is capable of achieving many accomplishments in the next few years. They include recapturing solid margins and averaging an 18-percent return on stockholders' equity, and resuming quality growth on the way to reaching the company's stretch goals by business, area and function.
 "We're facing industry challenges by continuing to improve our productivity and apply our collective strengths as we fulfill our mandate to bring value and growth to all our stakeholders," Popoff said.
 -0- 5/13/93
 /CONTACT: Douglas G. Draper of The Dow Chemical Company, 517-636-2876/
 (DOW)


CO: The Dow Chemical Company ST: Michigan IN: CHM SU:

ML -- DE048 -- 8235 05/13/93 15:28 EDT
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Date:May 13, 1993
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