The Weekly Catalyst
Global Chemical Update – More Nutritious & Delicious
Key Points:
- Global ammonia prices bounced from YTD lows at the start of 3Q23 to close the quarter at levels last seen in 1Q, a significant positive for North American producers, given their sizable cost advantage.
- Given still elevated farm income, we are more constructive on fertilizer and agricultural chemicals in 4Q23, relative to commodity petrochemicals, which mostly face oversupply and demand concerns.
- During 3Q23, Brent crude oil values rose 27%, which pushed up overseas chemical production costs and lifted prices, and US natural gas values only rose ~5%, which benefited domestic chemical margins.
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