15 December 2011 20:52 [Source: ICIS news]
US PP contract prices for December were at 67-69 cents/lb DEL (delivered) for homopolymer injection and raffia grade material, as assessed by ICIS.
Much of the PP market has a monomer-based contract that follows the monthly polymer grade propylene (PGP) cost. PGP settled down to 56 cents/lb for December.
While contract prices fell, spot prices were rising, based on tight supply, sources said.
Producers said they were sold out for the month and were offering very little material for the spot and export markets.
One producer said it was oversold by 30% and would need to cut orders in December because it did not have enough inventory to fill all of the orders.
Some of the tightness could be attributed to the pending closure in January of Phillips Sumika's 365,000 tonne/year capacity PP plant in Pasadena, Texas, sources said.
Another factor could be the closure of the Sunoco refinery in Marcus Hook, Pennsylvania, which limited the feedstock resources of Braskem's Marcus Hook PP plant, sources said.
One producer said if the tightness continues for several months, it is possible that producers may try to seek a margin increase.
Major North American PP producers include LyondellBasell, ExxonMobil, INEOS, Total, Formosa, Braskem Americas, Pinnacle Polymers, ConocoPhillips and Flint Hills Resources.
($1 = €0.77)
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