The Weekly Catalyst

North American Commodity Chemical Margins Strengthen In 1Q24 – Will It Last?
February 12, 2024
Companies Mentioned:
Dow, ExxonMobil, Chevron Phillips Chemical, Nova Chemicals, Celanese, PPG, Yara, CF Industries, Nutrien, LSB Industries, Poet Biorefining, ADM, Valero, Green Plains, The Andersons
Commodities Mentioned:
Crude Oil, Natural Gas, Ethane, Propane, Naphtha, Ethylene, Propylene, Benzene, Polyethylene, Polyvinyl Chloride, Polypropylene, Polystyrene, Ammonia, Ethanol
Report Sections:
Feedstocks & Energy, Global Ethylene Cracker – Spot Profit Analysis, Ethylene & Propylene – Price Trends, Other Relevant Global Commodity Chemical Trends, Global Polyethylene Analysis, Global Polypropylene Analysis, Global Chlor-Vinyl Analysis, Global Methanol Analysis, Global Chemical Data Sheets, Agriculture Price & Margin Dashboard, Flow Charts & Other Ancillary Data

The Weekly Catalyst

North American Commodity Chemical Margins Strengthen In 1Q24 – Will It Last?

  • Feedstock Market Trends: The North American natural gas/NGL advantage increased WoW relative to Ex-US petrochemical producers, pushing USGC ethylene spot margins based on ethane feedstock to a YTD high.
  • Chemical Market Trends: NW Europe base chemical prices reflected the most notable improvement WoW, with Asia reflecting the most weakness – a development that significantly benefits US exporters to Europe.
  • Polymer Market Trends: Western PE prices rose relative to Asia WoW, notably benefiting North American integrated PE producer margins. Global PP values were mostly unchanged, and US spot PP fell below PGP.
  • Agriculture Market Trends: Corn prices fell again WoW, pushing implied US farmer income lower and putting downward pressure on fertilizer use estimates. US ethanol margins fell WoW to a YTD low amid ample supply.

Exhibit 1 – Chart of the Day: North American polymer prices showed the largest gain WoW relative to feedstock costs.

Source: Bloomberg, C-MACC Analysis, February 2024

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