The Weekly Catalyst

North American Spot Petrochemical Margins Further Erode From 1H24 Highs, US Spot PE Prices Face Pressure
May 13, 2024
Companies Mentioned:
Dow, Nova Chemicals, LyondellBasell, Methanex, OCI, Celanese, Mitsui, CF Industries, Nutrien, LSB Industries, Yara International
Commodities Mentioned:
Polyethylene, Polypropylene, Polyvinyl Chloride, Ethylene, Propylene, Benzene, Methanol, Ammonia, Ethane, Naphtha, Crude Oil, Natural Gas
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 Spot Petrochemical Margins Further Erode From 1H24 Highs, US Spot PE Prices Face Pressure

  • Polymer Market Trends: US polyethylene (PE) prices have increased in 2024 relative to their 2023 average and production costs. However, export price weakness and rising costs have trimmed US margins from 1H24 highs.  
  • Chemical Market Trends: North American base and intermediate spot chemical prices mostly increased WoW, while Europe and Asia mostly saw price declines, suggesting downward pressure on US chemical export prices.  
  • Feedstock Market Trends: US natural gas and USGC ethane prices increased last week relative to crude oil, Ex-US naphtha, and Ex-US natural gas, pinching the still substantial North American feedstock cost advantage.
  • Agriculture Market Trends: Crop prices moved higher WoW, while spot ammonia values, on average, mainly were unchanged, with North American producers seeing margin erosion due to higher natural gas costs.

Exhibit 1 – Chart of the Day: Crude oil/Ex-US naphtha price support and much lower North American feedstocks have mostly benefited North American petrochemical producer margins relative to 2023 – will the benefits persist in 2H24?

Source: Bloomberg, C-MACC Analysis, May 2024


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