You’ve Got The Love – US Chemical Margins Grow As Its Feedstock Values Fall, Energy Sector Awareness Rises

Daily Chemical Reaction

You’ve Got The Love – US Chemical Margins Grow As Its Feedstock Values Fall, Energy Sector Awareness Rises

Key Points:

• Strength in North American chemical production margins due to falling feedstock costs relative to those abroad is boosting energy sector awareness of its downstream value chain benefits.
• US natural gas fell below US$2/mmbtu this week, while crude oil values reflect more support, pushing the oil-to-gas ratio to multi-year highs. This feedstock trend is positive for US chemicals.
• We show the movement in US ethylene cracker economics based on ethane feedstock and PDH margins relative to those abroad to display the sizable domestic feedstock cost advantage.
• We discuss sustainability and ESG trends related to consumer product demand, IRENA power market outlooks, and the Li-Cycle business update and views of European and US markets.
• US chemical rail traffic is depressed YTD relative to other areas of North America, German manufacturer supply chain health is rising, and global plastic per-capita use has room to grow.

See PDF below for all charts, tables and diagrams