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