July PGP nominated up 2 cents amid volatile RGP

26 June 2007 00:27  [Source: ICIS news]

HOUSTON (ICIS news)--A producer has nominated a 2-cent increase for July polymer (PGP) and chemical (CGP) grade propylene, market sources said on Monday.

The nomination comes amid conflicting opinions over market fundamentals.

Instead of going up, buyers said prices should decline because of rising inventories and soft demand.

The increase nomination came amid volatility in spot refinery grade propylene (RGP) prices on Thursday and on Monday. RGP is a significant indicator of the US propylene complex.

Sources in the market were not in consensus on why spot RGP has been so volatile. One producer said supply was tight, but traders and buyers disputed that perception.

Spot US RGP traded at 45.5 cents/lb for June on Monday morning. Prices then snapped back to Thursday’s levels with a July deal done at 47.625 cents/lb, according to global chemical market intelligence service ICIS pricing.

These deals followed Thursday transactions done in the range of 47.5-48.0 cents/lb, up from a deal done earlier in June at 45.75 cents/lb.

The June PGP contract price stands at 51.25 cents/lb, while CGP is at 49.75 cents/lb.

Equistar, ExxonMobil, ChevronPhillips, Shell and Enterprise are among the major US producers of PGP and CGP. Basell, Total, Solutia, Dow Chemical, Rohm and Haas and INEOS are among the main buyers.

By: Mark Quiner
+1 713 525 2653

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