Sunday Thematic & Weekly Recap

US Cost Advantage Shrinks, Rocky Setting Aids Mega-Cycle Thesis
June 5, 2022
Commodities Mentioned:
PVC, Polypropylene, Polyethylene, Polyurethane, Polycarbonate, Polystyrene, PET, Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha, Ethanol, Renewable Power, Oil, LNG, EVs, Methanol, Wind, Solar
Companies Mentioned:
CP Chemical, Nova Chemicals, Westlake, Celanese, Dow, LyondellBasell, ExxonMobil, Mura Technology, Linde, Saint-Gobain, Li-Cycle, Phillips 66, Denbury, KBR, Borealis, Olin, Nutrien, Origin Materials, YPF, RWE, Octal, LG Chem, Myers Industries, Repsol, Shell, Glencore, Unilever, 3M, Ecovyst, LanzaTech, Plug Power, Tesla, UGI Corporation, Heartwell Renewables, Stellantis, KKR, TPC Group, Lanxess, DSM, ABB, Enterprise Products, Qatar Petroleum, Donaldson, Venture Global LNG, DuPont, Advent, DWS, Adnoc, Chart Industries, Chevron, Cenovus, Suncor, Gazprom, Pemex, TotalEnergies, Borouge, Chemours, Gail, Mitsui Chemicals, Nexeo, Orion Engineered Carbons, Petronas Chemicals, Ube Group, Sadara, Cemex, CHIMEI, Livent, Neste, Delta, Deutsche Bank, Albemarle, HSBC, Air Products, Baker Hughes, Caterpillar, ConocoPhillips, Freeport McMoRan, FedEx, Halliburton, International Paper, J.B. Hunt, Marathon Petroleum, Republic Services, Schlumberger, UPS, Valero, Waste Management, Westrock, Accenture, Wells Fargo, IBM, Dollar General, Kimberly Clark, Sealed Air, NextDecade, Sherwin Williams, M&T Bank, United Airlines, Oxy, Sempra, GCS, Yara, Ineos, Trinseo, SABIC, CF Industries, Mosaic, Corteva, Bayer, The Andersons, ADM, Microsoft, Alpek, Clariant, Agrofert, Resco Products, Toray, Axens, Cepsa, Ford, Hexpol, Lotte Chemical, SK Innovation, Amazon, Carrefour, Hormel, Walmart

C-MACC Sunday Thematic & Weekly Recap 121

US Cost Advantage Shrinks, Rocky Setting Aids Mega-Cycle Thesis

  • US ethylene margins recently turned negative, regardless of feedstock, putting pressure on derivatives prices for integrated profit – margin risk in 2H22 is high.
  • Dow reaffirmed 2Q guidance this week, but market indicators suggest mounting headwinds facing US polyethylene contract price increases for May and June.
  • The price of many US polymers remains at a sizable premium to export market prices, and global trade channels should improve in the medium term.
  • We note a creative M&A moved from Advent, Lanxess, and DSM but question whether this is defensive against a worrying auto supply outlook.
  • Otherwise, we look at some slowing consumer indicators against a backdrop of higher prices and at the mounting perils of ESG investing and greenwashing.

Last week we discussed 20 Chemicals and related products and 127 Companies.

See PDF below for all charts, tables and diagrams

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