Daily Chemical Reaction
The Pest Of The West – US & Europe Inflation To Likely Outpace China Again In 2023 – Not Good For Chemicals
- The 2021/2022 price inflation surge in the US and Europe did not occur in China – it appears well poised to benefit from much lower relative inflation for the third consecutive year.
- China has enough spare capacity/labor to support its economic growth without price hikes, assuming its energy markets are not inflationary and Russian imports are likely curbing this risk.
- We highlight the Oxy 1Q23 report, looking at its oil-and-gas business, chemicals, and clean energy and carbon capture efforts, and we discuss Dow/X-Energy news at Dow’s Seadrift, TX site.
- The Nutrien 1Q23 report and earnings call highlight weak current conditions but a still positive farmer income setting favoring a tighter fertilizer market setting in 2H23 relative to 1H23.
- We note the recent back-and-forth views of Aramco’s blue hydrogen prospects, recent US CPI and PPI trends, and other energy and economic data supporting our global supply/demand view.
See PDF below for all charts, tables and diagrams