Despite Recent Regional Price Support, High Production Costs & Low Export Potential Favor More European Sector Restructurings

Chemical Market Trends: We discuss the improvement in US spot ethylene and polymer-grade propylene during the past thirty days relative to feedstock costs, a plus for producers but negative for merchant buyers.
Polymer Market Trends: We discuss European region polymer production closures despite, in many cases, its premium prices relative to other regions and why more regional restructuring is ahead in 2H24 and 2025.
Feedstock Market Trends: Global chemical feedstock prices were broadly lower WoW, with US natural gas showing the largest decline, and we discuss why this likely suggests lower chemical prices ahead in 2H24.
Agriculture Market Trends: Ammonia prices were relatively stable last week while Western feedstock costs mostly fell, a plus for producer margins, while crop price weakness lifts concerns around farmer spending.

Exhibit 1 – Chart of the Day: Europe spot PVC prices show a shrinking premium YTD relative to Asia, Brazil, and the US.