INEOS Grangemouth PP back up but force majeure remains

24 March 2010 16:34  [Source: ICIS news]

LONDON (ICIS news)--INEOS’s 285,000 tonne/year polypropylene (PP) plant at Grangemouth in the UK is back on line after a week’s unplanned outage due to technical issues, but force majeure remains in place, a company source said on Wednesday.

“The plant came back over the weekend [20-21 March],” said the source, “but force majeure is still in place. We are dry.”

PP availability throughout Europe was tight, largely due to propylene constraints, and producers had managed to foist increases of around €50/tonne ($68/tonne) onto the market.

Homopolymer injection net prices were trading around €1,100/tonne FD (free delivered) NWE (northwest Europe), but currently the market was on hold as players waited for the settlement of April propylene.

PP players were expecting an increase of up to €60/tonne on April propylene, and this would inevitably lead to increases on PP, several said.

“We will be looking for a three-digit hike for April PP,” said another major producer, while a large buyer retorted:“They will get nothing more than the propylene increase.”

The propylene contract settlement for April was expected imminently. The March contract stands at €910/tonne FD NWE, and some observers said that propylene could settle higher than ethylene for the first time ever. The March ethylene contract stands at €940/tonne FD NWE.

PP producers in Europe include LyondellBasell, Borealis, SABIC, Total Petrochemicals, Dow Chemical, Repsol, INEOS Olefins and Polymers, Polychim and Domo.

($1 = €0.74)

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By: Linda Naylor
+44 20 8652 3214

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