25 May 2011 10:24 [Source: ICIS news]
LONDON (ICIS)--An initial European propylene (C3) contract price for June has settled at €1,205/tonne ($1,697/tonne), down €40/tonne from May, because of weaker upstream crude oil and naphtha markets and a softer downstream outlook, a major integrated consumer said on Wednesday.
The settlement, which was between the consumer and one of its suppliers, has been fully confirmed.
A second major producer and a key non-integrated consumer have since followed the initial settlement.
The €40/tonne decrease from the May contract price, which was largely in line with market expectations, ends the seven-month run of rising propylene prices.
However, there is some feeling in the market that the decrease could have been more.
“In the light of yesterday’s [ethylene contract] announcement, our opportunities [for a greater decrease] were limited,” the key non-integrated consumer said.
“Feedstock costs would have allowed for a greater decrease on both ethylene and propylene,” the consumer added.
The June ethylene contract settled on 24 May at €1,185/tonne, down by €45/tonne from May.
($1 = €0.71)
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