The Weekly Catalyst
Global Chemical Update – Soul to Squeeze
- NW European Natural Gas prices have surged higher following their mid-2H22 flop, a risk we noted in our early 4Q22 research for European chemical production but a net plus for US exporters.
- Global nitrogen/ammonia fertilizer prices held up WoW, helped by rising production costs, which were considerably higher in NW Europe relative to the US. A notable plus for domestic producers.
- USGC ethane values rose relative to Ex-US naphtha values WoW, flattening the global ethylene cost curve a bit at the feedstock level. US natural gas also surged higher compared to Brent Crude.
- Global polymer values, on average, were modestly lower WoW, with polypropylene values seeing the most significant decline per our model, while polyethylene reflected the most support.