Twist & Shout – Existing Ammonia Producers Twist, Potential New Entrants Challenged Beyond the Shout!

Companies Mentioned: CF Industries, Nutrien, Aramco, Shell, ADNOC, Avient, IFF, Mosaic, Petro Rabigh, Hengli, Osaka Gas, Cheniere, ExxonMobil, Bunge, Yara, Navigator Holdings, Delek, Siemens Energy, Poet, Denbury, Alliance to End Plastic Waste, Carbios, Lucid, Attis Clean Energy
Commodities Mentioned: Nitrogen, Ammonia, Corn, Fertilizer, Natural Gas, Crude Oil, Soybeans, Hydrocarbons, LNG, Ethanol, Hydrogen, Polyethylene, Polypropylene, Biodiesel, Bioplastic, PET, SAF

Key Findings

General Thoughts: The farmer economy is enduring a period of weak crop prices, which has lifted concerns with farm spending and driven input supplier equity outperformance among those benefiting from cost advantages.
Supply Chain/Commodities: We discuss CF Industries and Nutrien 2Q24 business updates and outlooks, the North American ammonia production cost advantage, and another move by Aramco to secure oil demand in chemicals.
Energy/Upstream: We discuss the recent drivers of crude oil price volatility and the continued momentum in LNG offtake agreements amid a still wide price spread between Europe and Asia natural gas and North American levels.
Sustainability/Energy Transition: CF Industries displays its decarbonization efforts in its 2Q24 business update – existing low-cost ammonia producers face fewer challenges than potential new clean entrants, such as Ten08.
Downstream/Other Chemicals: We highlight views of farmer income trends since 2014, also highlighting corn and soybean price trends during this period, and we break apart US 2024 agriculture export statistics to focus on crops.