Weekly Chains Update

Research evidence excerpt

Weekly Chains Update

Update

August 3, 2026 04:45 AM GMT

Morgan Stanley & Co. LLCMChemicals | North America Vincent Andrews

Equity Analyst

Weekly Chains Update Vincent.Andrews@morganstanley.comTurner W Hinrichs +1 212 761-3293

Research Associate

Turner.Hinrichs@morganstanley.com +1 212 761-1269

Steven K Haynes, CFA

North America Polyethylene (PE) market update: spot domestic prices were flat Steven.Haynes@morganstanley.com

Justin T Pellegrino

to +1cpp week-over-week (FOB Houston, railcar), and spot export prices were +1cpp

to +3cpp week-over-week (FCA Houston, railcar). Contract prices for July remain Justin.Pellegrino@morganstanley.com +1 212 761-4054

unsettled as of Friday. On demand, reports indicate slower activity and more limited

Chemicals

transactions this past week. In export markets, reports note that buyers’ North America

expectations increasingly lean toward higher prices in August (e.g., ~$220/MT noted Industry View In-Line

in Latin America), though Asian offers could regain competitiveness amid lower

freight costs. In Mexico, reports indicated an unusually slow market this past week,

and reports indicate July activity is expected to be slightly better than in June. On

supply, most PE units are reportedly running at robust rates. Some buyers are of the

view that the market is short, which may be caused by producers postponing offers.

Natural gas prices decreased and ethane prices increased week-over-week, resulting

in an increased frac spread of 6.01c/gal (vs. 4.68c/gal the prior week). Last week,

ethane prices increased 0.2c/gal (0.8%) to 24.3c/gal, while natural gas decreased

5.8% to $2.75/mmbtu. For further details on our polyethylene outlook, please

see: Chemicals: Polyethylene S&D Update (21 Apr 2026) and Chemicals: China PE