ReSEARCH

Latest Reports

 

Our most recent publications are summarized in the blocks below and you can browse through all our reports to the right of the blocks. We encourage you to request a trial for full access to our research.

Europe: High Costs and Too Much Focus

Europe: High Costs and Too Much Focus

The Europeans risk bankrupting themselves if they keep pushing ahead with largely uneconomic hydrogen projects, almost all showing no promise of achieving the economics required to survive.

As the subsidy and price pass-through ask rises, we do not expect local governments to react by spending even more public money; instead, we expect an easing of rules to allow a role for less perfect but lower-cost options.

The Shell renewable fuels backdown may have some project cost basis, but the larger driver is likely customer reluctance to pay up for much more expensive products – despite subsidies – this could change for SAF.

We evaluate why China can accelerate electrolyzer development, while European and US makers may get orders and capacity reservations but not much action. Orders for Europe may stall if Shell is a precedent.

Otherwise, we review only a handful of projects – Germany, the UK, and Australia, with only Australia looking plausible, we note the pressure on grey ammonia prices and recap our weekend work on data center power.

read more
Can They Hold On? – US Spot Integrated Polymer Margins Near YTD Highs, Europe Chemical Prices See the Most Strength WoW

Can They Hold On? – US Spot Integrated Polymer Margins Near YTD Highs, Europe Chemical Prices See the Most Strength WoW

Chemical Market Trends: US integrated spot polymer margins rose into 3Q24 amid global price strength and upstream feedstock cost relief, creating a favorable setting for the 2Q reporting season for producers.

Polymer Market Trends: Western base chemical prices rose WoW relative to Asia, with Europe seeing the most regional price strength on average, and US spot ethylene being the strongest among the commodities.

Feedstock Market Trends: Brent Crude Oil and Ex-US naphtha prices have increased in the past 30 days relative to US natural gas and USGC ethane, pushing the North American cost advantage upwards.

Agriculture Market Trends: Crop prices fell WoW, implying downward pressure on farmer income and the perception of fertilizer use, though ammonia prices are relatively unchanged compared to feedstock costs.

read more
Summer of Love – Maybe Not; Summer of Profits – Possible for Some

Summer of Love – Maybe Not; Summer of Profits – Possible for Some

As each week of the summer progresses, we get another data point that causes planning headaches, both short and medium term. Hurricane Beryl may have caused minimal industry damage, but the early arrival is not good.

Meanwhile, politics is all over the place with surprises in Europe, the US (as recently as yesterday), Mexico, and India kicking off a year in which consequences for industrial and climate policy are increasingly opaque.

In Europe this week we have had discussions with companies at the challenging end of the scale – high costs on a global basis, even higher costs of decarbonization, and a strong green lobby that wants to ban everything.

read more
Green Shoots & Ammonia Boots: Europe’s Quirky (And Costly) Hydrogen Adventure!

Green Shoots & Ammonia Boots: Europe’s Quirky (And Costly) Hydrogen Adventure!

General Thoughts: We discuss efforts to subsidize green ammonia supplies from relatively low-cost areas to high-cost regions, highlighting the Fertiglobe winning the H2Global pilot auction to supply green ammonia to Germany.

Supply Chain/Commodities: We highlight global ammonia spot price developments, compare US and Europe gray ammonia production costs, and highlight US spot ethylene and propylene strength WoW after Hurricane Beryl.

Energy/Upstream: Global natural gas prices declined this week relative to crude oil prices, a positive for US ethylene producers. We also discuss India’s efforts to source long-term discounted crude oil supplies from Russia.

Sustainability/Energy Transition: We discuss H2Global efforts to spur green ammonia supplies into Europe, the risk of near-term subsidies relative to long-term goals, and still high production cost and demand challenges.

Downstream/Other Chemicals: We highlight the weakness in US durable goods prices as shown by the latest CPI, led lower partly by weakening used car values, and note credit sourcing troubles facing European manufacturers.

read more
Data Center and Other AI Related Power Demand Poses Challenges for Industry

Data Center and Other AI Related Power Demand Poses Challenges for Industry

1st Topic of the Week: Our expectations around renewable power availability for industry is getting more challenging as power demand expectations rise and the purchasing power of the data centers looks much higher than industry. Industry cannot find many customers willing to pay for green/clean and cheap power is needed.

2nd Topic of the Week: We use a lithium example to discuss the risk of “peak” investing – building something that only makes sense with high prices. The investment process in the US and Europe is slow enough to last through some pricing peaks and avoid mistakes – China moves much faster and can build based on a peak market view.

Otherwise: We look at some recycling price opportunities in food packaging, highlight another reason why we believe carbon credit values will rise steeply, note some of the battery initiatives are stalling – bad for lithium demand, good for EV makers, and we take a quick first look at the new BP net-zero global model.

read more
Contrasts & Confluences: Western Near Shoring Efforts Face Challenges from Low Eastern Prices

Contrasts & Confluences: Western Near Shoring Efforts Face Challenges from Low Eastern Prices

General Thoughts: C-MACC Co-Founder Graham Copley’s meetings in Europe this week suggest there is as much worry about China in Europe as in the US – all want less reliance on China, but many see greater dependence.

Supply Chain/Commodities: We discuss the strength of global chemical prices, notably in the West amid logistic issues from Asia and supply outages, and critical mineral price weakness, notably in lithium, as flagged by Tianqi.

Energy/Upstream: We highlight the BP energy outlook and comment on a few of its exhibits as we observe a bit of a balancing act, which is the case with most forecasts, underpinned by a few core global energy market views.

Sustainability/Energy Transition: We discuss the potential for AI and data center electricity demand to drive a tailored power mix for consumers and the still significant challenges to building out low-carbon supply chains.

Downstream/Other Chemicals: We highlight the latest consumer price index (CPI) postings from China and the US, flag relevant downstream business updates, and look at US rail traffic and China export product trends.

read more

Request a Free Trial

Archives