Daily Chemical Reactions

Mercy – Demand Headwinds & Rising Availability To Damper 2H Chemical Prices, Put Costs More In Focus
July 26, 2022
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Avient, ADM, Ecolab, Henkel, Dow, Westlake, LyondellBasell, Nova Chemical, Nutrien, Bunge, Corteva, , CF Industries, RPM, Asian Paints, Itero, Wacker Chemie, Solvay, OCI, SK Innovation, Veolia, Navin Fluorine, Origin Materials, Hexcel, Trinseo, Air Products, Johnson Matthey, Lotte Chemical, Itochu, SRF, BHP, Reliance Industries, Redwood Materials, Whirlpool, Shell, Livent

Daily Chemical Reaction

Mercy – Demand Headwinds & Rising Availability To Damper 2H Chemical Prices, Put Costs More In Focus

Key Points:

  • Global commodity chemical supply will likely grow relative to demand in 2H22, lessening regional price differences. Cost curve developments will regain focus.
  • Global natural gas prices have surged higher WoW, and considerable challenges face the European market in 2H22. We also discuss US LNG export trends in 1H22.
  • Most chemical producers experienced raw material inflation in 2Q. Quickly lifting prices allowed some chains to beat profit expectations relative to others.
  • Air Products is placing a significant bet on the hydrogen market, though its only competitive edge, in our view, is its US pipeline network and balance sheet.
  • Whirlpool cut its profit guidance for 2022 based on weakening demand and higher input costs. We continue to take a cautious view of durable-good demand in 2H22.

See PDF below for all charts, tables and diagrams

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