The Weekly Catalyst
Feedstock Shifts In Focus, As North American Costs Broadly Inflate YTD
- Feedstock Market Trends: North American petrochemical producers hold a sizable cost advantage compared to Europe and Asia. However, this advantage has shrunk YTD as its feedstock costs have increased relatively.
- Chemical Market Trends: Global monomer and base chemical values, on average, rose WoW, with ethylene showing less support than its co-products. Methanol values declined with global natural gas prices.
- Polymer Market Trends: Global polymer prices also reflect support WoW, with polyethylene (PE) spot prices in North America reflecting more support than Asia and Europe and outpacing domestic spot ethylene increases.
- Agriculture Market Trends: US Ammonia prices have fallen compared to natural gas costs since late 4Q amid slow demand and its production advantage relative to Europe and Asia shrinking with ex-US natural gas prices.
Exhibit 1 – Chart of the Day: Chemical feedstocks have risen more YTD in North America relative to Asia and Europe.
Source: Bloomberg, C-MACC Analysis, January 2024