Daily Chemical Reactions

Plastic Is Not Elastic If You Can’t Make It – European Producers Stretched From Logistic Issues, High Costs
August 17, 2022
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Talos Energy, Bloom Energy, Koch, Chemours, Anaergia, Colonial Chemical, Evonik, BYD, Sasol, Baker Hughes, Merck, Kaneka, Showa Denko, Wood, Mitsui Chemicals, Teijin, BASF, Rongsheng Petrochemical, Orica, Rompetrol, Norge Mining, Plains Midstream, Tidewater Midstream, Altus Power, ICL, Cero Generation, Ameresco, Sunel, Liberty Energy, Capstone Green Energy, Andritz, Epsilyte, Advent Technologies, U.S. Steel, Equinor, Shell, Lotte Chem

Daily Chemical Reaction

Plastic Is Not Elastic If You Can’t Make It – European Producers Stretched From Logistic Issues, High Costs

Key Points:

  • European chemical producers are not responding to high downstream prices due to logistic challenges and high net production costs – this development favors imports.  
  • NW Europe naphtha values have fallen amid reduced demand to reflect nearly a five-year low relative to Asia and more than a 10yr low relative to US natural gas.
  • NW Europe spot polymer prices reflect a premium to US levels, a modest benefit for US export prices facing relatively lower Asia polymer prices in some chains.
  • We discuss the passage of the inflation reduction act, the significant growth ahead of ammonia and hydrogen markets, and beneficial 45Q adjustments.
  • Lowe’s and Target results add to Home Depot and Walmart results yesterday to display consumer preference shifts, and we flag the July drop in housing starts.

See PDF below for all charts, tables and diagrams

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