All Over The Road – Demand Speed Bumps Rise, Virgin Resin Weakness Could Brake Recycled Content Pledges

Daily Chemical Reaction

All Over The Road – Demand Speed Bumps Rise, Virgin Resin Weakness Could Brake Recycled Content Pledges

Key Points:

• The US Sept. producer price index (PPI) posting exceeded expectations. Most views of inflation peaking in 4Q22 inadequately consider energy market and geopolitical risks.
• Global economic growth concerns and energy transition headwinds support the OPEC crude oil supply cuts when considering their view of maximizing near-term cash flow.
• We flag the BASF business update, discuss the EU conditional approval of the Celanese acquisition of DuPont M&M, and flag lows in US spot propylene relative to propane.
• Virgin plastic prices have fallen relative to recycled resin prices, putting packager resin sourcing ambitions to the test. We also discuss carbon taxes and border adjustments.
• US mortgage rates hit more than a 20yr high this week, mattress sales indicators are falling, and multiple data points suggest a global economic slowdown is underway.

See PDF below for all charts, tables and diagrams