“Luke, You Were Our Father” – Lithium Wars – Another Commodity Facing The Dark Side of Overconfidence?

Daily Chemical Reaction

“Luke, You Were Our Father” – Lithium Wars – Another Commodity Facing The Dark Side of Overconfidence?

Key Points:

• The lithium spot price collapse relative to early 2023 estimates has caused producer Albemarle to cut its full-year profit outlook – an example of a reversal in commodity market overconfidence.
• A central theme from the 1Q23 reporting season is that a period of security supply concerns in 2022 preceded the recent period of oversupply, resulting in some overstated commodity swings.
• We discuss the differences in Phillips 66 and LyondellBasell olefin and polyolefin operating rate views for 2Q23 and display the weakness in Shell production rates in 1Q23 relative to 4Q22.
• We discuss Westlake 1Q23 results and why we remain constructive on US Chlor-Vinyls in the medium-term, and we switch gears also to flag Denbury results and frame our CCS market views.
• Global crop markets remain tight, supporting farmer spending and benefiting seed and crop protection producers more YTD than those producing fertilizer that faces a period of oversupply.

See PDF below for all charts, tables and diagrams