C-MACC Sunday Thematic & Weekly Recap 107
The West Finesses Sanctions; Rampant Inflation Likely Anyway
- In 4Q ‘21 we predicted a positive sentiment move to inflation/shortage-levered commodity chemical equities – YTD performance has exceeded our expectations.
- With underlying demand growth already very strong, the Russia/Ukraine conflict will likely drive enough panic buying and keep commodity prices elevated.
- All eyes are on energy, but most supply chains remain stretched, and spare capacity is limited worldwide – all reporting companies confirm strong order books.
- We discuss actions at Westlake to boost its more stable return generating building products segment, concluding that this compelling story has room to grow.
- Otherwise, we focus on energy markets, concluding that supply restrictions are a greater risk in Europe than energy price inflation alone.
Last week we discussed 29 Chemicals and related products and 141 Companies.
See PDF below for all charts, tables and diagrams