30 April 2010 05:26 [Source: ICIS news]
By Chow Bee Lin
SINGAPORE (ICIS news)--The US to Asia arbitrage window for polypropylene (PP) is expected to open for June and July shipment with US PP export regaining competitiveness on the back of falling US propylene feedstock values, Asian traders said on Friday.
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US refinery-grade propylene (RGP) spot prices plunged to 39 cents/lb ($860/tonne) in the week ended 23 April, dropping by 18% from a week earlier due to softer demand and increased supply, according to global chemical market intelligence service ICIS pricing.
The drop in feedstock costs could lead to higher operating rates and export availability of PP, a source said.
However, for now prevailing PP prices in the
In Asia, the benchmark PP injection and yarn grades were assessed at $1,310-1,380/tonne CFR China for the week ended 23 April, according to ICIS pricing.
Meanwhile, a trader was heard to have sold
Current US Gulf export offers for homopolymer and copolymer grades PP were said to be widely available around 62-65 cents/lb FOB (free on board) in railcar, which work out to above $1,450/tonne CFR China, with US-China freight estimated at $100/tonne, according to industry sources.
Some Asian traders said they were wary of a repeat of history as Asian resins prices fell dramatically in 2005 and 2006 when large quantities of US material were offered to
The prospect of more US PP flowing to Asia had already prompted some traders to off-load material at their bonded warehouses in
“We bought 200 tonnes of US material from an Asian trader at $1,340/tonne CFR (cost and freight)
However, it was not immediately clear if the quantity of US material to be offered would be enough to push Asian prices down, the Asian traders added.
Additional reporting by David Barry in Houston
($1 = €0.76)
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