Daily Chemical Reaction
- A harsh 2H23 commodity chemical profit setting is needed to drive global restructuring and lift any confidence that 2024 will notably improve – otherwise, current profit outlooks are too high.
- Street profit expectations will likely reset lower for 2H23 with corporate handholding, but most want to paint a better view of 2024, setting a high bar/limiting out-year estimate revisions.
- Commodity chemical industry oversupply is a positive for non-integrated specialty chemical producers – we anticipate that this chemical sub-sector will outperform commodities in 2H23.
- We continue to foresee most of the commodity chemical industry restructuring developing in Europe and note CF Industries’ decision to permanently close an ammonia facility in the UK.
- We also display positive US ethanol margin trends, supported by the ADM 2Q report, flag the push from Braskem in bio-polymers, and highlight numerous sector downstream demand trends.
See PDF below for all charts, tables and diagrams