22 April 2010 23:08 [Source: ICIS news]
By David Barry and William Lemos
Expectations among PP converters ranged from a 7-10 cent/lb ($154-220/tonne, or €116-165/tonne) drop in May, compared with a 7 cent/lb average April increase.
A buyer said the downtrend would likely continue in June.
“It’s just overvalued, no doubt about it,” the source said, citing an estimated 25-30 cent/lb gap between US and ?xml:namespace>
PP processors with the flexibility to delay orders are doing so in anticipation of the coming price drop.
“People are playing their volumes, and all of the sudden there’s not as much demand. I’ve heard that from several places.” another buyer said.
Talk emerged this week that a
Based on propylene prices in Europe at €1,040-1060/tonne, the 5,000-6,000-tonne
Freight was estimated at $130/tonne.
A second propylene cargo for 5,000 tonnes was heard to be in process for early May loading.
Exports of propylene from the US Gulf point to a sharp reversal from the last six months, when tight
The market was still said to be tight in early April as contracts rose by 7 cents/lb, even thought spot began to show some signs of weakness.
“Things change fast,” one market participant said, predicting a significant contract drop in May.
“Yes, a big drop but who knows what that will be,” another source said.
US PP contract prices have closely tracked the movement of the polymer-grade propylene (PGP) benchmark.
ICIS pricing assessed domestic deliveries of prime injection-grade homopolymer were at 87.5-90.5 cents/lb in April.
Major US PP producers include Sunoco, LyondellBasell, ExxonMobil, INEOS,
($1 = €0.75)
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