Daily Chemical Reactions

Achy Breaky Heart – Global Supply Arteries Expand, Production Blockages Needed To Pump Up Margins
November 30, 2022
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Nutrien, CF Industries, LSB Industries, Chemours, Petronas Chemical Group, OCI, Brenntag, Univar, SK Innovation, Braskem, Arxada, Pilbara Minerals, Maire Tecnimont, BP, Ineos, Chevron, ConocoPhiliips, Enterprise Products, Freeport LNG, Engie, PKN Orlen, SABIC, Aramco, Nouryon, Livent, Elementis, Manali Petrochemicals, American Arcyl, Woodside, Meridian, Covestro, Honeywell, AkzoNobel, Nabaltec, Mitsubishi Chemical, Umicore, LG Chem

Daily Chemical Reaction

Achy Breaky Heart – Global Supply Arteries Expand, Production Blockages Needed To Pump Up Margins

Key Points:

  • Global chemical product market indicators reflect improving availability, suggesting considerable risk amid an energy price surge – the risk facing most markets is sizable.
  • NW European natural gas prices have surged relative to US levels, and we discuss why the major test will be 1Q23 (not December). We also highlight US production trends.
  • We discuss chemical distribution market consolidation and flag projected supply additions in markets, such as HDPE and methanol, where margins are presently low.
  • bp and Shell are buying renewable natural gas (RNG) assets, which is a plus for the sellers, but we discuss why benefits to Shell and bp will likely be relatively small.
  • Global container freight rates, on average, are trending toward 2019 levels, keeping our concerns of an international slowdown in motion despite a few positive updates.

See PDF below for all charts, tables and diagrams

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