10 May 2012 22:21 [Source: ICIS news]
HOUSTON (ICIS)--Mexico’s sole polypropylene (PP) producer, Indelpro, reduced the price of all grades by 5 cents/lb ($110/tonne, €85/tonne) effective on 7 May, reflecting lower costs of feedstock propylene and to better compete with cheaper imports, a company source said on Thursday.
US propylene contracts for May fell by 10 cents/lb on Wednesday, confirming initial settlements reached the previous day.
The 13% reduction put US polymer-grade propylene (PGP) in May at 67.50 cents/lb, while bringing chemical-grade propylene (CGP) contracts down to 66.00 cents/lb.
PP demand has been soft since February, when feedstock propylene went up by 16.5 cents/lb. Propylene prices rose again in March to later level off in April.
Meanwhile, transformers were struggling to transfer the higher costs to consumers and were only buying small volumes while waiting for prices to drop.
The current reduction puts homopolymer prices in Mexico at 89-90 cents/lb, according to seller sources, with copolymers slightly higher, sources said.
Prior to the May decrease, the price of PP homopolymers in Mexico was in the range of $1,974-2059/tonne FOT (free on truck), according to ICIS.
($1 = €0.77)
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