Chemical Product Chains In Focus – The Parts Lacking A Competitive Edge Face A Tough Global Setting

Daily Chemical Reaction

Chemical Product Chains In Focus – The Parts Lacking A Competitive Edge Face A Tough Global Setting

Key Points:

• Polymer price differences (minus freight) face compression between regions as oversupplied conditions mount – global cost curve placement is the best gauge of regional integrated profits.
• We highlight PDH unit additions in China that will likely put downward pressure on regional propylene (& derivative) prices and further cut co-product credits for Asian ethylene producers.
• China economic data continues to miss expectations, but its chemical capacity expansions for 2H23 and 2024 remain on track, which will cause the targeting of other markets to absorb supply.
• Investments in technologies to make cheaper green hydrogen are rising, but awareness of the challenges facing those needing to source high-capacity-factor green power remains too low.
• US retail sales increased in July, but consumer spending trends at Home Depot and Target vary, suggesting that some chemical end-product markets are seeing more support than others.

See PDF below for all charts, tables and diagrams