Daily Chemical Reactions

Hot Pursuit – North American Cost Advantage Spurs Investment, Varied Constraints Emerge for Some
February 23, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Ineos, LyondellBasell, LSB Industries, Cheniere, Albemarle, TotalEnergies, Sasol, Air Liquide, Covestro, Solvay, ExxonMobil, SK Materials, Sinopec, Worley, Mitsubishi Chemical, Anglo American, Capstone Green Energy, Aqualung, Denbury, Orbia, Arkema, Marathon Oil, Mura Technology, Shell, Formosa Plastics, BASF, Chemtrade Logistics, Technip FMC, Uniper, Eni, Eastman, Fisker, Valmont, Farmland Partners, Lucid, Masonite, Wood Group, Dollar General, Greenworks, Sunnova, Blackstone

Daily Chemical Reaction

Hot Pursuit – North American Cost Advantage Spurs Investment, Varied Constraints Emerge for Some

Key Points:

  • The North American chemical producer cost advantage remains significant relative to overseas peers, as is the case for domestic energy producers, suggesting sizable integration benefits.  
  • We discuss the Ineos initiative to move upstream into chemical feedstock production with its announced Eagle Ford Investment and highlight Cheniere’s positive US LNG growth outlook.
  • We highlight a broadly constructive ammonia and fertilizer market outlook for 2023 from LSB Industries, which aligns with our view. We also discuss Arkema and Solvay volume commentary.
  • We highlight the Denbury 4Q22 results and its comments on EPA permits allowing US CO2 sequestration growth and flag its recent strategic investment in Aqualung Carbon Capture.
  • North American chemical rail volume remains depressed YTD, suggesting production cutbacks, while we link weak European chemical export expectations to demand and its high-cost position.

See PDF below for all charts, tables and diagrams


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