The Chemical Company Weekly Market Update Benzene Ethylene Propylene PGP RGP Crude Natural Gas June 20, 2018

Weekly Market Update: June 20, 2018

TCC’s Weekly Raw Materials Update: June 20, 2018.

Ethylene

Slightly lower
Jun MtB-NOVA bid at 12cpp, offered at 12.875cpp
Last traded at 13.5cpp

Benzene

Lower in June
Priced DDP HTC at 280cpp

Propylene

RGP
June PGP bid at 54cpp, offered at 58cpp

RGP
June RGP bid down to 39cpp, last traded at 42cpp

Brent Crude Oil

Futures higher this week
Monday: $65.85/bbl
July NYMEX WTI Crude

Crude Oil

Futures lower this week
Monday: $75.34/bbl
AUG ICE Brent

Natural Gas

Flat-to-lower
Monday: $2.951/mmBtu
July NYMEX

Weekly Market Review

The Chemical Company Weekly Market Update Benzene Ethylene Propylene PGP RGP Crude Natural Gas June 20, 2018

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.

The Chemical Company Weekly Market Update Benzene Ethylene Propylene PGP RGP Crude Natural Gas June 5, 2018

Weekly Market Update: June 5, 2018

TCC’s Weekly Raw Materials Update: June 5, 2018.

Ethylene

Ethylene was slightly higher, up to 15.625cpp
Flat so far in June

Benzene

Benzene is flat-to-lower recently
Priced DDP HTC at 294cpp

Propylene

RGP
June PGP up to 61.125cpp

RGP
June RGP also up to 42.00cpp

Brent Crude Oil

Futures lower this week
Tuesday: $75.29/bbl
AUG ICE Brent

Crude Oil

Futures lower this week
Tuesday: $64.75/bbl
July NYMEX WTI Crude

Natural Gas

Flat-to-lower
Tuesday: $2.93/mmBtu
July NYMEX

Weekly Market Review

The Chemical Company Weekly Market Update Benzene Ethylene Propylene PGP RGP Crude Natural Gas June 5, 2018

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.

The “New Norm” of Logistics, Downstream Effects on the Chemical Industry

A variety of factors drives the specialty chemical market and chemical industry as a whole. Material availability, price fluctuations, geopolitical issues on a local and global scale and more, all contribute to cost changes, either for or against profitability. However, all potential hiccups to a production timeline are at the mercy of the transportation & logistics industry, one that accounts for 10 cents of every dollar in the U.S. economy (Donald Broughton / MSN).

The first half of 2018 saw unprecedented changes across the logistics industry. The average age of truck drivers continues to sit around the age of retirement, approximately 65 years old, an age that continues to skew older as ELD mandates are fully enacted, and today’s millennials choose not to enter the logistics marketplace. This tightness is clearly reflected in the rising cost of dry van trucking, raising the spot price from $1.41 in 2014 to $1.85 per mile in 2018 (MSN).

As of April 1, 2018, ELD Mandates proposed and enacted by the Federal Motor Carrier Safety Administration (FMCSA) officially went into effect, meaning drivers found out of compliance may be ticketed, and placed out of service until their trucks comply. Acutely opposed to significant industry changes, many older drivers have chosen to retire or find other work rather than submit to a new way of working, an issue that continues to push drivers out of the market faster than they are coming in.

Unforeseen and unprecedented shortages of OTR (over-the-road) freight options has pushed capacity onto railroad transportation, a medium that saw 6.5% growth in March 2018 compared to the same period in 2017. While railroad may be a savior for particular products or transportation lanes, it is a slower mode of transport, and often requires much further advanced planning and processing, which some shippers aren’t able to provide.

Nearly all goods manufactured, produced and/or sold in the United States are aboard a truck or rail car at some point in their lifespans, whether as early-on raw materials or as last steps before reaching end consumers. In many situations, and especially in the specialty chemical market, goods are moved multiple times as they go from raw materials to usable pieces or portions of final, consumer-ready products.

No industry or product category is exempt from these assumptions, whether it is produce, children’s toys, technology, agricultural or farming product or quite literally, anything else one might see in a shopping mall, industry wholesaler, or grocery store.

A comment from Donald Broughton of Broughton Capital published in a recent report on MSN stated, “Logistics and transportation account for almost 10 cents of every dollar in the U.S. economy. If there is a 10 percent increase in transportation costs, that gives you a 1 percent increase in inflation for the broader economy. That’s real.”

The logistics market is accustomed to tightening and easing market conditions like weather, seasons, seasonal product demand, and available truckers fluctuate. The current major issues in today’s freight market, however, don’t appear to be tightening market conditions. The market seems to be entering the new norm of the logistics industry for what will likely be years to come.

 

References
www.MSN.com

The Chemical Company Weekly Market Update Benzene Ethylene Propylene PGP RGP Crude Natural Gas May 24, 2018

Weekly Market Update: May 24, 2018

TCC’s Weekly Raw Materials Update: May 24, 2018.

Ethylene

Ethylene last traded Tuesday at 14.5cpp
May was bid at 14cpp, offered at 16cpp
June bid at 14.25cpp

Benzene

Benzene continues to be flat this week
Last priced DDP HTC at 297cpp

Propylene

RGP
May PGP traded up to 53cpp
Up from 51cpp last week

RGP
May RGP bid down to 35.5cpp, offered up to 41cpp

Crude Oil

Flat-to-higher this week

Wednesday: $71.84/bbl
(June NYMEX WTI Crude)

Natural Gas

Slightly higher this week

Wednesday: $2.914/mmBtu
(June NYMEX Natural Gas)

Weekly Market Review

The Chemical Company Weekly Market Update Benzene Ethylene Propylene PGP RGP Crude Natural Gas May 24, 2018

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.

U.S. and China Relations Improve, Tariffs on Hold

Trade relations between the US and China improved this weekend.

The Trump administration made meaningful actions to put the looming trade war with China on hold after Treasury Secretary Steven T. Mnuchin said they would refrain from implementing significant tariffs on various Chinese goods.

In a joint statement on May 19, China agreed to purchase increased amounts of U.S. goods, including agriculture, energy, and manufactured goods. However, China has not formally released a quantitative figure committing to the amount they will purchase, and when.

The announcement comes after President Trump announced tariffs of $150 billion on Chinese goods, including an initial $50 billion set to take effect in the coming weeks. China retaliated with tariffs of an equal scale, all of which has been in stalemate and a state of uncertainty over the past month.

The U.S. – China trade deficit reached $337 billion last year, by far the largest of any country.

These announcements come through a mix of the joint statement, statements by Treasury Secretary Mnuchin, and President Trump’s personal Twitter account.

President Trump is scheduled to meet with North Korean ruler Kim Jong Un in Singapore in early June, and the trade talks with China may be a precursor to assistance soliciting North Korea to give up their nuclear arsenal.

It is unforeseen and unpredictable what may happen with the U.S. and China trade relationship, and tariffs may likely not be entirely off the table. However, the recent news and announcements appear to be a sign toward deescalating potential trade war concerns and economic stability between nations.

 

Resources:

http://www.latimes.com/business/la-fi-china-us-trade-war-on-hold-20180520-story.html
https://www.cbsnews.com/news/trump-says-barriers-and-tariffs-with-china-are-coming-down/


https://abcnews.go.com/Politics/wireStory/us-china-beijing-commits-buying-american-goods-55297175

Weekly Market Update: May 7, 2018

TCC’s Weekly Raw Materials Update: May 7, 2018.

Ethylene

Ethylene was mostly flat this week
Bid at 12.625cpp, Offered at 13.25cpp
Last traded at 13.125cpp

Benzene

Benzene mostly flat this week
Last priced DDP HTC at 294cpp

Propylene

RGP
May PGP Bid down to 48cpp
Last traded at 49.25cpp

RGP
May RGP traded at 38cpp

Crude Oil

Higher this week

Monday: $70.73/bbl
(June NYMEX WTI Crude)

Natural Gas

Higher this week

Mon: $2.741/mmBtu
(June NYMEX Natural Gas)

Weekly Market Review

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.

Weekly Market Update: April 16-20, 2018

TCC’s Weekly Raw Materials Update: April 16-20.

Ethylene

Spot ethylene slightly lower this week, to 14cpp

30-day weighted average: 15.637cpp
Compared to March average: 19.656cpp

Benzene

Spot ends the week flat-to-down, $2.92/gal DDP HTC

May: 292-296cpg DDP HTC
June: 290-295cpg DDP HTC

Propylene

RGP
Apr PGP up slightly, to 44.75cpp
May PGP traded at 44.5cpp

RGP
Spot RGP bid higher, no trades. Up to 35cpp

Polypropylene

Prices flat-to-higher
Strong demand and unplanned outages
PP export falling off

Polyethylene

Spot prices moved lower
LDPE clarity, LDPE coating and HMWPE film remain tight
PE export availability improved, spot offers limited

Polystyrene

Spot prices down, buyers look to lower feedstock costs

Crude Oil

Higher this week

Monday: $66.22/bbl
Fri: $68.38/bbl
Last Fri: $67.39/bbl
(May NYMEX WTI Crude)

Brent: June Brent settled at $74.06/bbl Friday

Natural Gas

Higher this week

Mon: $2.752/mmBtu
Fri: $2.739/mmBtu
Last Fri: $2.735/mmBtu
(May NYMEX Natural Gas)

Weekly Market Review

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.

The Chemical Company Crude Oil

Crude Oil Inventories & Price in 2018: High Prices, Immediate Impacts

In early January 2018, oil prices hit their highest levels in more than three years. “U.S. crude oil inventories are at their lowest level since August 2015. OPEC is getting closer to its target of reducing OECD industrial stocks to the five-year average,” says PVM Oil Associates analyst Tamas Varga.

The Chemical Company Crude Oil

Data from the U.S. Energy Information Administration showed that crude inventories fell by almost 5 million barrels to 419.5 million barrels in the week of January 5, 2018. This drop is likely due to the extreme cold weather that stopped some onshore output in North America, which was expected to be short-lived. Production cuts led by OPEC and Russia that started in January 2017, and are set to continue throughout 2018, have underpinned charges. There is still downward pressure in the physical market, where the second and third largest OPEC producers have cut their prices to remain competitive.

The oil price decline that began mid-2014, when the price of oil was consistently over $110/bbl, has changed the fundamental economics of the global chemicals industry, and has brought about widespread uncertainty. Additional supply from North American shale oil and continued high production levels from OPEC are likely to make a slow but steady recovery.

Nonetheless, prices will need to recover over time to permit investment in production and exploration. Over the past ten years, oil prices have gone through at least two complete cycles, and more significant swings are likely to happen. During this time of ever-changing prices, setting short and mid-term plans will continue to be necessary.

Oil is one of the key ingredients in the manufacture of various chemicals and related products. Consequently, many chemical firms benefit from lower crude oil prices. However, companies using natural gas as opposed to oil for their feedstock do not enjoy those benefits, resulting in the cost of natural gas affecting chemical firms more than the price of oil in those cases.

Additionally, a substantial decline in crude oil prices would impact the market in other ways. It makes the economics of petroleum substitutes a great deal less attractive, including bio-based and battery chemicals. This issue is causing companies, from global powerhouses to niche firms, to reevaluate their strategies.

 

 

Sources:
https://www.cnbc.com/2018/01/10/oil-markets-near-3-year-highs-on-tighter-us-market.html
https://www.icis.com/resources/news/2018/04/10/10210537/us-on-pace-for-record-oil-natgas-production-in-2018/

Weekly Market Update: April 9-13, 2018

TCC’s Weekly Raw Materials Update: April 9-13.

Ethylene

Spot ethylene steadies this week at 14.25cpp

45-day weighted average: 15.653cpp
Compared to March average: 19.887cpp

Benzene

Spot ends the week flat, $2.94/gal DDP HTC

US higher than Europe and Asia

Propylene

RGP
Spot PGP up slightly, to 43.75cpp

RGP
Spot RGP trades up to 33.5cpp

Polypropylene

Prices flat-to-higher, supply remains tight with strong demand
PP operating rates rebounding to 93.5%

Polyethylene

Flat-to-lower this week
Supply of some grades show signs of loosening
LLDPE relatively available
HDPE BM shows flat availability
LDPE film, HMWPE film remain tight

Polystyrene

Prices steady this week, limited spot activity, relatively good availability

Crude Oil

Higher this week

Monday: $63.42/bbl
Fri: $67.39/bbl
Last Fri: $62.06/bbl
(May NYMEX WTI Crude)

Natural Gas

Higher this week

Mon: $2.693/mmBtu
Fri: $2.735/mmBtu
Last Fri: $2.701/mmBtu
(May NYMEX Natural Gas)

Weekly Market Review

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.

Weekly Market Update: April 2-6, 2018

TCC’s Weekly Raw Materials Update: March 26-29.

Ethylene

Spot ethylene hits new lows this week
Traded Friday at 14.25cpp

Benzene

Spot was higher this week
Ended up 2cpg, to 296cpg ($885/mt)

Propylene

PGP
Spot Mar PGP steady at 42cpp

RGP
Spot Mar RGP bid higher, no new trades
Spot RGP ~ 29.5cpp

Polypropylene

Prices steady with tight availability for most grades

Polyethylene

HDPE BM HIC for export ended the week at 57cpp
LDPE film steady Friday at 55cpp
Domestic demand strong for HDPE, LDPE and LLDPE

Polystyrene

Prices firm this week, limited spot supply for HIPS and GPPS

Crude Oil

Lower this week

Monday: $63.01/bbl
Fri: $62.06/bbl
Last Fri: $64.94/bbl
(May NYMEX WTI Crude)

Natural Gas

Flat-to-lower this week

Mon: $2.683/mmBtu
Fri: $2.701/mmBtu
Last Fri: $2.733/mmBtu
(May NYMEX Natural Gas)

Weekly Market Review

TCC produces weekly market review graphics, with content courtesy of PetroChem Wire. This information is distributed via TCC’s social media pages, including Facebook, Twitter, LinkedIn and Instagram, as well as posted to The View section of the website, and occasionally published via email with other market updates.