US propylene producer seeks 2 ct hike, undercuts Nov nominations

HOUSTON (ICIS news)--A US propylene producer proposed a 2 cent/lb ($44/tonne or €29/tonne) increase for November, undercutting the 3 cent/lb initiatives of two other suppliers, market sources said on Friday.

The latest initiative represents an increase of just over 4% from October prices.

US polymer-grade propylene (PGP) contracts for October settled at 47.00 cents/lb, down by 10 cents/lb from September, and chemical-grade propylene (CGP) prices fell by 10 cents to 45.50 cents/lb, according to global chemical market intelligence service ICIS pricing.

Propylene buyers had expected monomer prices to drop again in November, but hopes of a decrease faded after crude oil prices began to rise earlier this month, driving up propylene production costs.

Although crude prices fell to $77/bbl on Friday, the NYMEX front month still commanded a premium of 10% compared with around $70/bbl at the start of October.

A weak US dollar and some revived optimism about the economic recovery supported the recent surge in crude prices.

US propylene contracts for November are expected to settle sometime during the first week of the month.

LyondellBasell, ExxonMobil, Chevron Phillips Chemical, Shell Chemical and Enterprise Products are among the major US producers of PGP and CGP.

Total, Solutia, Dow Chemical and INEOS are among the main buyers.

($1 = €0.67)

For more on propylene, visit ICIS chemical intelligence
To discuss issues facing the chemical industry go to ICIS connect

< previous article(VIDEO - ICIS news Europe Lunchtime Bulletin 18 January 2010)

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly