19 March 2010 12:16 [Source: ICIS news]
LONDON (ICIS news)--Major polypropylene (PP) producer LyondellBasell is imposing an extra €50/tonne ($68/tonne) on all supplementary European PP sales in March, even though most monthly business is now settled, a company source said on Friday.
PP prices had already risen by €50-60/tonne in March, for freely-negotiated business, leaving most homopolymer injection business trading around €1,100/tonne FD (free delivered) NWE (northwest Europe) on a net basis.
PP availability in Europe was tight and three cases of force majeure were in place.
PP producers were generally expecting an increase in the April monthly propylene contract settlement, and were preparing to implement further increases to the PP market in April.
“We will probably be looking at three-digit increases,” said another PP producer.
Others preferred to wait until the April propylene contract settled before announcing PP plans for April, but several said they would be looking to implement more than the straight propylene increase in a move to improve margins.
Buyers’ reactions were mixed.
“We will just have to take it. As long as propylene is short, that controls the market,” said one buyer.
“I won’t be paying any big increases,” said another. “We can’t pass them on to our end markets.”
The April propylene contract was expected to settle next week. The current March level stands at €910/tonne FD NWE.
PP producers in Europe include LyondellBasell, Borealis, SABIC, Total Petrochemicals, Dow Chemical, Repsol, INEOS Olefins and Polymers, Polychim and Domo.
($1 = €0.73)
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