Feedstock Cost Relief Benefits North American Chemical Producers Relative to Europe & Asia; Global Prices Mixed, But Mostly Lower

The Weekly Catalyst

Feedstock Cost Relief Benefits North American Chemical Producers Relative to Europe & Asia; Global Prices Mixed, But Mostly Lower

• Polymer Market Trends: Global spot polymer prices were mostly lower in Asia and North America but higher in Europe last week. North American integrated margins held near YTD highs amid feedstock cost relief.
• Chemical Market Trends: Global base chemical values were more mixed than polymer values WoW, as North America and Europe reflected more weakness, on average, than Asia which has lower margins than both.
• Feedstock Market Trends: Global chemical feedstock costs benefited North American chemical producers last week, as US natural gas and ethane prices fell relative to crude oil and ex-US naphtha and natural gas prices.
• Agriculture Market Trends: Crop prices remain weak, as US corn and soybean prices sit at YTD lows, while an uptick in global ammonia prices benefited US producer margins relative to most peers abroad.

Exhibit 1 – Chart of the Day: North American spot polyethylene (PE) and polyvinyl chloride (PVC) integrated margins reflect levels above their 1H24 average, while integrated polypropylene (PP) margins are below their 1H24 average.

Source: Bloomberg, C-MACC Analysis, January 2024