Monomer prices and outages push up PP values

19 April 2007 22:35  [Source: ICIS news]

HOUSTON (ICIS news)--Higher April feedstock propylene prices, together with numerous refinery outages resulting in propylene shortages, drove polypropylene (PP) producers to announce April and May price increase proposals, industry sources said on Thursday.

PP buyers said they were still assessing the various price increase initiatives for April-May and were not sure if they could absorb the increase.

After implementing a 4 cents/lb hike on PP effective 1 April, manufacturers proposed additional increases for mid-April or 1 May.

Most PP participants said the 4 cents/lb increases implemented in April were justified by rising feedstock polymer grade propylene (PGP), which settled up 4 cents at 49.5 cents/lb ($1,091/tonne) in April, but questioned the following round of proposed hikes.

One producer nominated a 3 cents/lb hike for 15 April and an additional 5 cents/lb for 1 May.

Another manufacturer proposed plus 5 cents/lb for 1 May, and later announced an additional 4 cents/lb boost, also for 1 May, bringing the total May nomination to 9 cents/lb.

If implemented, the PP price increases for the months of April and May would total 12 cents/lb or 13 cents/lb.

US benchmark domestic bulk prices for injection grade PP stand at 61-64 cents/lb, according to global chemical market intelligence service ICIS pricing

US PP producers include Total, Basell, INEOS, Sunoco, Dow Chemical and ExxonMobil.

By: Ron Coifman
+1 713 525 2653

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