Daily Chemical Reactions

Regional Solutions To Global Problems Should Be Approached With Caution; Cost Positions Are Key
June 18, 2024
Commodities Mentioned:
Ethane, Ethylene, Naphtha, Propane, Propylene, Polyethylene, LNG, Carbon Dioxide, Natural Gas, Wind, Solar, Oil, EVs, Batteries, Hydrogen, Nuclear Power
Companies Mentioned:
Wanhua, Sabic, Braskem Idesa, INEOS, Covestro, Adnoc, Shell, Fisker, Eastman, BYD, Trina Solar, Canadian Solar

Daily Chemical Reaction

Regional Solutions To Global Problems Should Be Approached With Caution; Cost Positions Are Key

Key Findings

  • General Thoughts: From overseas trips presenting our research to clients to expanding the C-MACC/PXi polymer price expectations service, the summer will be busy at C-MACC as we help global clients navigate uncertain times.
  • Supply Chain/Commodities: The North American petrochemical market has increasingly linked itself to the health of exports, and efforts to support domestic end-product prices could prove harmful for its commodity producers.
  • Energy/Upstream: We discuss the significant North American natural gas/NGL cost advantage provided to its petrochemical industry relative to Asia and Europe and the rising pull on cheap feedstocks from high-cost regions.
  • Sustainability/Energy Transition: We are pressing the gas pedal on our hydrogen work, as we will host a webcast led by C-MACC Co-founder Graham Copley on July 2nd, ahead of other global events and upcoming presentations.
  • Downstream/Other Chemicals: We flag a few economic indicators suggesting a bit of improvement in Europe and also discuss the recent surge in freight rates that is helping shield Europe from cheap product flows from Asia.

Exhibit 1: Average integrated polyethylene (PE) production costs in Asia currently equal US spot average PE prices.

Source: Bloomberg, C-MACC Analysis, June 2024

See PDF below for all charts, tables and diagrams


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