Daily Chemical Reaction
Cruel Summer: Above Average Temperatures Could Lift US Nat Gas vs Crude – Less US Competitive Edge
- US natural gas and USGC ethane prices rise relative to Brent Crude and Ex-US naphtha WoW, a negative development for US commodity chemical profits that puts some 2Q views in question.
- We flag the drop in US propane values relative to ethane amid mostly unchanged US spot ethylene and propylene WoW. Domestic PDH operators reflect improved economics WoW.
- We discuss the SQM 1Q23 earnings disappointment, its efforts to expand lithium production amid high demand expectations, and the uptick in China spot lithium prices from 1yr lows.
- Crop prices remain well above 2019-1H23 levels, keeping expectations of farmer income and spending high, and we discuss the Syngenta push for its equity IPO amid this favorable backdrop.
- We discuss efforts to expand global carbon capture networks, the mounting headwinds facing European recyclers, and the tepid global freight and cargo setting keeping demand concerns high.
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