03 January 2012 08:06 [Source: ICIS news]
By Loh Bowei
The prices of industrial-grade propylene glycol (PGI) on a CFR (cost & freight) northeast (NE)/southeast (SE) Asia basis were assessed at $1,650-1,680/tonne (€1,270-1,294/tonne) CFR on 23 December 2011, according to data from ICIS.
The prices of pharmaceutical-grade propylene glycol (PG USP) were at $1,880-1,930/tonne CFR NE Asia and $1,910-1,940/tonne CFR SE Asia on the same day, the data showed.
“It is really hard to predict PG prices now because the poor macroeconomic environment has affected people psychologically,” a downstream unsaturated polyester resins (UPR) maker from southeast Asia said.
UPR is used in housing such as sinks and water tanks.
“[The prices of] PG follow a country’s GDP [gross domestic product] because downstream UPR is used in the construction sector,” a Malaysian buyer said.
PG USP is used in the production of personal care products, such as cosmetics, and in the food additives sector.
Feedstock propylene oxide (PO) supply is expected to grow because of Dow Chemicals’ 390,000 tonne/year PO plant in
This may weaken the prices of PG, but the demand forecast for the product in the first quarter is unclear and the current macroeconomic climate will result in an uncertain outlook, the trader said.
However, regional end-users’ inventory levels of PGI are low because most players maintained minimal purchasing over the past few weeks in view of the eurozone debt crisis, which may increase prices, market sources said.
“If demand [were to] pick up [next quarter], the prices [of PGI] will increase,” a southeast Asian buyer said.
On the other hand, the PG USP market is generally more stable than that of PGI and the demand for the former is expected to be stable in the first quarter, a northeast Asian PG USP maker said.
($1 = €0.77)
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Read John Richardson and Malini Hariharan’s blog – Asian Chemical Connections
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