Daily Chemical Reaction
US Consumers – Skip New Home Purchases, Take An International Vacation, Pray For Chemical Makers
Key Points:
- The US Dollar relative to other major global currencies and the US 30yr mortgage rate reached more than a 10yr high this week – both trends are negative for US chemicals.
- Global energy and feedstock values broadly declined WoW, providing a bit of cost relief to the commodity chemical sector, which is seeing price declines globally on avg.
- We discuss the news of more chemical production reductions in the US, the negative margin setting for global ethylene producers, and length in most polymer markets.
- US ethanol production margins stepped modestly lower WoW, and we highlight that US ethanol prices now reflect a premium to RBOB gasoline due to its recent decline.
- We highlight sizable concerns surrounding the auto industry, the drop in median US home sales prices YoY, and discuss North American rail traffic trends worth noticing.
See PDF below for all charts, tables and diagrams