Daily Chemical Reactions

I Don’t Need You Now – 2H23 Chemical & Agriculture Price Hikes Depend On Supply Cuts, Production Disruptions
July 13, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
BASF, Dow, Huntsman, Celanese, Bunge, ADM, Nutrien, Corteva, Syngenta, LSB Industries, FMC, Conagra, Aramco, Aker Carbon Capture, Shell, Technip Energies, Sasol, Mitsui Chemicals, Fortum Battery Recycling, Maire Tecnimont, Toray Industries, Trinseo, NextDecade, Bechtel, BP, TotalEnergies, Kinder Morgan, Greenland Resources, TROES Corp, Mercuria, ExxonMobil, Black & Veatch, John W Stone, Plug Power, QatarEnergy, Amazon, Fastenal, Toshiba

Daily Chemical Reaction

I Don’t Need You Now – 2H23 Chemical & Agriculture Price Hikes Depend On Supply Cuts, Production Disruptions

Key Points:

  • North American chemical and grain rail traffic is lower YTD in 2023 amid moderating demand and shifting global trade patterns – both markets depend on supply cuts to bolster 2H23 prices.
  • Petrochemical production capacity in North America has increased in 1H23 relative to 1H22 and 1H21 levels, but operating rates remain under pressure to keep inventory growth in check.
  • US crop prices remain elevated compared to pre-covid levels, though we find growing concern with shifting demand and trade creating the need for supply cuts to increase crop prices in 2H23.
  • BASF cuts its 2023 profit view, adding to the growing list of global chemical producers missing expectations, and we find more sector uncertainty than confidence surrounding a 1H24 advance.
  • China’s June exports fell at their fastest pace since February 2020, which we view with concern as it indicates weakening global demand. Price inflation faces downward pressure globally.

See PDF below for all charts, tables and diagrams


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