Cheap Chinese Goods – Creator of US Petrochemical Export & Clean Product Price Drama, Asia Ex-China (& Europe) Horror

Companies Mentioned: Anglo American, BHP, Glencore, Honeywell, Dow, Deere, Nutrien, Crescent Energy, SilverBow Resources, Freeport LNG, Plug Power, Uber, Lego, Aquapak Polymers, Adnoc, Mitsui & Co, BASF, Fortescue Energy, Thyssenkrupp Nucera, Microsoft, BYD
Commodities Mentioned: Ethylene, Ethane, Propylene, Propane, Crude Oil, Metals, Copper, Naphtha, Olefins, Natural Gas, Renewable Power, Hydrogen, Carbon Emissions, Ammonia, Biofuels, Sodium Batteries

Key Findings

General Thoughts: Western consumer price inflation is moderating but remains high relative to China – North American chemical producer cost advantages provide an offset; most of Asia Ex-China and Europe lack this benefit.
Supply Chain/Commodities: The advantaged North American chemical production cost position was a major driver of North American confidence at NPE, while the opposite in Asia Ex-China and Europe is spurring reviews.
Energy/Upstream: We highlight Asia and Europe naphtha prices relative to USGC ethane, a Honeywell technology geared to lift naphtha-based light olefin production, and a few Alberta feedstock-to-chemical production benefits.
Sustainability/Energy Transition: The surge in positive sentiment toward hydrogen has not been met with similar sentiment toward firm offtake agreements amid lingering price and project finance challenges for many globally.
Downstream/Other Chemicals: We discuss agricultural equipment producer Deere, cutting 2024 profit guidance, still strong North American chemical rail traffic YTD, and the recent rebound in China-to-Europe freight rates.