Daily Chemical Reactions

Low Asia Prices and The North America Production Cost Advantage Favor Price Deflation, Lift Project Finance Risk    
November 16, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Berry Plastics, Dow, LyondellBasell, Westlake, ExxonMobil, Nova Chemicals, Baystar Polymers, Chevron Phillips Chemical, Goodyear, AkzoNobel, SK GEO, Chemtrade, Trecora, OCI Global, Röhm, Messer, BASF, SK On, Sumitomo Metal Mining, Asahimas Chemical, Evonik, GM, Emirates, Mercedes-Benz, Opal, Tesla, Topsoe, TotalEnergies, Toyota, Burberry, Lenovo, Siemens Energy, Walmart, CF Industries, Lotte Chemical, Adnoc, bp, Mitsubishi, Vermilion Energy Inc.

Daily Chemical Reaction

Low Asia Prices and The North America Production Cost Advantage Favor Price Deflation, Lift Project Finance Risk    

Key Points

  • Price deflation is more of a risk to Western chemical producers than inflation in 2024, amid low-priced Asia products – higher interest rates and project cost inflation amplify this risk.
  • We highlight global polymer price trends, discuss the Berry Plastics 4QFY23 business update, and reiterate many relevant plastics market themes from our PackExpo meetings during 3Q23.
  • Project cost inflation is a hot topic in offshore wind, hydrogen, and other areas of the energy transition, as off-taker/buyer efforts to raise prices are falling short due to uncertain demand.
  • We highlight rising strategic activity in chemicals outside China to consolidate, close, or shed underperforming assets and discuss recent global chemical feedstock cost movements.
  • We discuss the recent decline in US retail sales, why food prices could stay more supported than most in 2024, and flag North American rail traffic volume shifts by its major categories.

See PDF below for all charts, tables and diagrams


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