Outages & Costs Drive Early-2024 Regional Chemical Margin Shifts

Feedstock Market Trends: Brent Crude and ex-US naphtha values reflected more support WoW than global natural gas and US ethane – North American costs, on average, benefited WoW relative to Asia and Europe.
Chemical Market Trends: Global monomer and base chemical values, on average, rose WoW, with ethylene in the US showing less strength than Ex-US ethylene or its cracker co-products, lifting cost headwinds for buyers.
Polymer Market Trends: Global polyethylene prices rose the most WoW with higher feedstock costs abroad and storm-related production issues in North America – North American margins improved the most WoW.
Agriculture Market Trends: Global natural gas price declines outpaced ammonia values lower WoW, but a flattening of the global production cost curve and crop price weakness suggests margin pressure ahead.

Exhibit 1 – Chart of the Day: Global Natural gas and USGC ethane have collapsed relative to their 2023 average levels.