UpdateUS Oct propylene contracts fall 14 cents/lb on inventory

07 October 2011 01:17  [Source: ICIS news]

US propylene falls(Adds paragraphs 2, 4-8)

HOUSTON (ICIS)--US propylene contract prices for October settled down 14 cents/lb from September, market participants said on Thursday.

Market participants earlier this week predicted a substantial drop in propylene contract prices as a result of a build-up in refinery grade propylene (RGP) inventories.

The settlement brings the polymer-grade propylene (PGP) contract down to 64 cents/lb ($1,411/tonne, €1,058/tonne) and chemical-grade propylene (CGP) down to 62.50 cents/lb.

RGP accounts for 60% of the US propylene market. The product traded last week as low as 55 cents/lb, down from 64 cents/lb a week earlier.

RGP bids were heard as low as 45 cents/lb on Wednesday.

US propylene contracts usually settle near the beginning of the month to which they apply.

US propylene contracts for September rolled over from August in a settlement that kept polymer-grade propylene (PGP) at 78.00 cents/lb and chemical-grade propylene (CGP) at 76.50 cents/lb.

Major US producers of PGP and CGP include Chevron Phillips Chemical, Enterprise Products, ExxonMobil, LyondellBasell, Petrologistics and Shell Chemical.

The main buyers include Dow Chemical, INEOS, Ascend Performance Materials and Total.

($1 = €0.75)

Additional reporting by William Lemos

For more on propylene visit ICIS chemical intelligence

By: Samuel Weatherlake
+44 20 8652 3214

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