Targeted protectionism emerging; we would still ", "hold our horses" on near-term equity implications

Following our previous recent note on European protectionism in chemicals, the EU Critical Chemicals Alliance (CCA) proposals, presented at the end of last week, reinforce our view that EU policy may be moving toward a more explicit "strategic capacity" framework for the sector - but one that is likely to be targeted and conditional rather than a broad tariff-style catalyst. The strongest equity read-across is not simply whether a company produces a molecule on the draft non-exhaustive critical list, which is already broad, but whether it has exposure to: (i) scarce EU production of a critical molecule, (ii) last-of-a-kind or few-producer dynamics, or (iii) integrated sites whose closure could create ecosystem-wide disruption. This distinction matters: BASF may be less relevant as a pure molecule-scarcity play in ethylene/propylene and more as an ecosystem lock-in / integrated-site beneficiary, while Evonik, Solvay and Wacker may screen more directly on few-producer critical-molecule e