Daily Chemical Reactions

Stand By Me – North American Chemical Production Cost Advantage Rises Again WoW, Significant Risks Remain
April 14, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Covestro, Shell, OMV, BASF, PPG, RPM, Wanhua, Dow, Huntsman, Kemira, ExxonMobil, Avery Dennison, Amcor, TotalEnergies, Li-Cycle, BearHead Energy, Vertex Energy, EnergyX, Aether Fuels, Neste, Glencore, BHP, Chart Industries, Wolf Carbon Solutions, Ineos, Chevron, Chandra Asri, Chemours, Odyssey, Braskem, Rivian, Univar, ConocoPhillips, Yamaha, NEXT Energy Tech, Berry

Daily Chemical Reaction

Stand By Me – North American Chemical Production Cost Advantage Rises Again WoW, Significant Risks Remain

Key Points:

  • Global feedstock costs shift further WoW in favor North American chemical producers relative to Asia and Europe, curbing but not erasing profit downside risk into a coming supply advance.
  • We discuss the Covestro 1Q23 business update that shares many similarities with a few peer updates – despite it beating profit estimates, it does not curb our 2Q and 2H23 sector concerns.
  • We discuss the latest EIA short-term energy outlook, comparing its crude oil and natural gas price estimates to current levels and flag implications for the global petrochemical cost curve.
  • We highlight the YTD loosening in some global critical mineral markets, such as nickel and lithium, that was not anticipated by many in 2H22 and generally add to our EV market views.
  • From US retail sales and industrial production to global freight rates, macroeconomic data postings remain weak and generally keep our 2023 global consumer demand concerns elevated.

See PDF below for all charts, tables and diagrams


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