Daily Chemical Reactions

Chemical Corporate Economic Outlooks Mostly Align; Strategic Actions Pick Up, But Vary
March 14, 2024
Commodities Mentioned:
Styrene, Polystyrene, Ethylene, Lithium, Paraxylene, Ethanol, Urethanes, Crude Oil, Natural Gas, Hydrogen, Carbon, PE, PET
Companies Mentioned:
Lanxess, Trinseo, Americas Styrenics (AmSty), Air Liquide, LG Chem, Lithium Americas, Pilbara Minerals, Shell, RWE, Enviva, ADNOC, NextDecade, Technip Energies, Amazon, Aramco, Siemens, AT&T, Anaergia, BP, Black & Veatch, Berry Global, Evonik, Sinopec, Orsted, NextEnergy, Novoloop, OPAL Fuels, Mitsubishi Heavy Industries, thyssenkrupp nucera, Volkswagen, Syensqo, Tomra, Gemserv, Nippon Steel, Apple, Dollar General, Woodside, Glencore, UFP Packaging, Tesla

Daily Chemical Reaction

Chemical Corporate Economic Outlooks Mostly Align; Strategic Actions Pick Up, But Vary

Key Findings

  • General Thoughts: Continued US economic strength in 2024 and Europe and China moving from a weak 1H24 to improving conditions in 2H24 is a chemical sector corporate consensus view that is far from risk-free, in our view.
  • Supply Chain/Commodities: We discuss increasing corporate strategic actions in chemicals and associated industries as companies, such as Trinseo and Lanxess, adjust their business models to cut underperforming assets.
  • Energy/Upstream: We highlight the support in Brent crude oil prices YTD relative to the erosion in global natural gas values and that Shell’s lifted focus on LNG is a critical component of its revised sustainability strategy.
  • Sustainability/Energy Transition: We discuss Shell scaling back its sustainability targets, highlight the Enviva bankruptcy and restructuring filing, and flag the RWE 2024 outlook reflecting lower profits YoY relative to 2023.
  • Downstream/Other Chemicals: The exhibits in the downstream demand section of this report mainly focus on China, enabling the comparison to economic data releases in the US, and we discuss other relevant news.

Exhibit 1: The US PPI rises relative to the CPI in February, likely suggesting consumer-level price strength in March.

Source: Bloomberg, C-MACC Analysis, March 2024

See PDF below for all charts, tables and diagrams

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