Global Weekly Catalyst No. 269

Base Chemical Global Analysis

Global Weekly Catalyst No. 269

• General Thoughts: Global base chemical prices, on average, declined last week, following crude oil and Ex-US natural gas prices lower, a negative development for downstream prices and North American margins in 1Q25.  
• Feedstocks & Energy: Global base chemical production costs at the feedstock level display a significantly flatter cost curve for most chemicals in 1Q25 than in 1Q24, creating a challenging setting for price increases YoY.
• Olefins: US and Europe spot polymer-grade propylene (PGP) and ethylene prices declined last week relative to Asia – greater production issues favor US spot propylene price support relative to ethylene in the near term.   
• Other Base Chemicals: Global spot benzene prices reflect declines WoW, which we partially link to weakness in crude oil prices and generally weak derivative demand, though it may benefit margins for some MDI producers.
• Agriculture: Global ammonia spot prices declined WoW relative to movements in natural gas prices, with US natural gas prices rising relative to Asia and Europe. Corn prices weakened WoW amid positive planting views.
• Refining & Biofuels: US ethanol production margins remained negative last week; however, they showed some improvement from lower corn prices. US crude oil refinery margins fell WoW but remain higher YTD.

Exhibit 1 – Chart of the Day: A flattening global production cost curve is helping to pull base chemical values lower.  

Source: Bloomberg, C-MACC Analysis, March 2025