Daily Chemical Reactions

Santa Baby: I Only Want One Thing – Economic Growth – But I Want a Lot!
December 23, 2022
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Wanhua, Dow, Huntsman, Covestro, BASF, Air Liquide, Methanex, Repsol, Chevron Phillips Chemical, Röhm, JK Cements, Acro Paints, Taiyo Oil, Syrah Resources, Tesla, ExxonMobil, Harvest Midstream, Phillips 66, Maire Tecnimont, Oxxynova, Mitsubishi Chemical, Petrobras, ECR Minerals, TSMC, Syngenta, Chart Industries, Raven SR, Nikola, White Martins, Grupa Azoty, Neste, Freeport LNG, Trinseo, AMG

Daily Chemical Reaction

Santa Baby: I Only Want One Thing – Economic Growth – But I Want a Lot!

Key Points:

  • Global chemical markets reflect oversupply and low margins, and this will not change without significant demand growth in 2023. It is unlikely on Santa’s delivery list.
  • US gasoline and natural gas prices have fallen from 2H22 highs, curbing cost inflation concerns among US consumers and manufacturers and lifting early 2023 optimism.
  • We discuss the Wanhua MDI capacity addition in China, show China methanol relative to a few derivative price trends, and note several relevant domestic chemical trends.
  • Many “green” chemicals appear economically viable in incentive-driven markets but face greater operating and funding headwinds in those with inadequate support.
  • We discuss surging China COVID cases, US consumer confidence and spending trends, and macro indicators that keep our concerns high about demand relative to supply.

See PDF below for all charts, tables and diagrams

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