Daily Chemical Reactions

We All Want To Compete With China, But We Cannot Afford To; It Is Getting Worse As They Get Cheaper!
September 1, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Allkem, Albemarle, SQM, Glencore, Vale, Freeport-McMoRan, BHP, Olin, Westlake, Sempra, Recticel, Berry Global, Shell, Chevron, Marathon Petroleum, SABIC, Tianqi Lithium, Ecopetrol, Celanese, TotalEnergies, Technip Energies, Versalis, Fresh Inset, Asahi Glass, Mitsubishi Gas Chemical, Proton Green, CB&I, Acron Eramet, Ganfeng Lithium, Stolthaven, Teijin, ExxonMobil, Cargill, ADM, Hytera, Sinopec, Octopus Energy, AGC, Enterprise Products

Daily Chemical Reaction

We All Want To Compete With China, But We Cannot Afford To; It Is Getting Worse As They Get Cheaper!

Key Points:

  • China has benefited from lower price inflation than most Western countries and is one of the culprits of global commodity market oversupply – recent critical mineral trends add to our case.
  • The C-MACC Clean Energy Minerals Monthly Price Index fell ~11% in August to a YTD low that returns the index to mid-2021 levels – most index component prices have declined in 3Q23.
  • We discuss US chlor-alkali and ethylene profit trends relative to Europe, highlighting that the ethylene chain drives most of the integrated profitability for US polyvinyl chloride producers.
  • We highlight China as the global leader in clean energy material processing and discuss why dethroning them from this position could prove difficult, especially if low global prices persist.
  • MS River freight rates have risen as low water levels have limited traffic, but rates are far below 2022 highs. Available capacity in other transport sectors will help keep rates in check.

See PDF below for all charts, tables and diagrams

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