North American Cost Advantage Shines In 3Q Results, Asian Supply Darkens Other Markets – Is The US Next?

Daily Chemical Reaction

North American Cost Advantage Shines In 3Q Results, Asian Supply Darkens Other Markets – Is The US Next?

Key Points

• The North American commodity chemical sector 3Q23 results reflect improvement relative to mid-year expectations and its peers in Europe and Asia, but the positive momentum has slowed.
• We discuss the Methanex 3Q23 report, which unsurprisingly beat most Street expectations, and Asia MTO production as another example of pulling on low-cost North American feedstock.
• Recent strategic moves at ExxonMobil, Chevron, and Shell support a view of confidence in a stronger-for-longer fossil fuel view – we think more long-term risk surrounds oil than natural gas.
• We highlight more issues with offshore wind across numerous 3Q reports, the drop in credits for renewable fuels amid their rising production, and metals and mining decarbonization views.
• US GDP growth beat expectations in 3Q, but skepticism about future growth remains high, and we display North American rail traffic trends and global container shipping rates at a five-yr low.

See PDF below for all charts, tables and diagrams