Daily Chemical Reaction
Fighting Demons – Agriculture & Energy Commodity Prices Moderate, Demand May Still Face Purgatory
Key Points:
- Global agriculture and energy commodity price strength remain significant YoY end-use inflation and 2Q earnings season topics, but most have fallen from 2Q22 highs.
- We find US energy cost advantages relative to Europe displayed in many 2Q sector reports. We highlight result postings from Devon Energy, Williams, and Marathon.
- The CF Industries 2Q report and outlook align with our positive agricultural market view. We remain much more cautious on global commodity chemical sector trends.
- National oil companies, not big oil companies, generate most O&G sector emissions and have been slower to adapt to climate change initiatives, limiting global efforts.
- We discuss the recent slowdown in US and China manufacturing, the downward trend in global freight rates, and lingering supply shortages in Germany.
See PDF below for all charts, tables and diagrams