Daily Chemical Reactions

Anything But Back To Normal – Thoughts On Late 2Q Optimism, Asia-US Price Spreads
July 14, 2020
Commodities Mentioned:
Brent Crude, Naphtha, Natural Gas, Benzene, Ethane, Ethylene, Propylene, Polyethylene, Polypropylene, Polyvinyl Chloride, Caustic Soda, Lithium, Xylenes
Companies Mentioned:
Sherwin Williams, Avient, Formosa Plastics, Sasol, Braskem, Huntsman, Hexion, Olin, Kraton, ASIX, AkzoNobel, BASF, Covestro, Lanxess, Intertape Polymer Group, Advanced Petrochemical Co., Aramco, Celanese, Clariant, Orbia, Westlake, Adani Gas

Daily Chemical Reaction

 

Anything But Back To Normal – Thoughts On Late 2Q Optimism, Asia-US Price Spreads & Other Items

Key Points:

  • US business optimism is rising per recent Fed survey and aligns with 2Q chemical sector pre-releases noting improvement from April/May lows– we are much less convinced and discuss several potential headwinds in 2H20.
  • US benzene markets have tightened meaningfully relative to Asia during the past ~6 weeks – we think this could serve as a headwind for non-integrated US producers, such as Huntsman and Olin in epoxies, Kraton in Styrenics and ASIX in nylon.
  • Other items worth note today target more producer reports announcing “better-than-expected” 2Q20 results, energy and commodity chemical items of note, and varying reports targeting the global EV and vehicle market.

See PDF below for all charts and tables 

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