Midnight Train To Margin Pain: Costs Rise, Exports Surge, Relief Leaves The Station

Key Findings

General Thoughts: US relative cost advantages persist, but rising global prices are compressing downstream margins as exports rise and cost transmission accelerates across global industrial and consumer chains.
Supply Chain/Commodities: US propane cracking is regaining relevance as co-product prices tighten globally, narrowing ethane’s advantage and rewarding US feedstock flexibility more than headline spreads imply.
Energy/Upstream: Global LPG tightness and feedstock substitution are reinforcing US propane demand, tightening spreads and extending propane’s economic role beyond what feedstock prices alone capture.
Sustainability/Energy Transition: AI expansion increasingly favors power developers with credible delivery plans, as delays, conversion losses, and AC-heavy designs constrain usable capacity despite claimed supply.
Downstream/Other Chemicals: US PPI outpaced China’s in March, even as both moved higher, with rising industrial costs pressuring pricing power and strengthening the advantage of low-cost producers globally.