31 May 2012 10:47 [Source: ICIS news]
(recast with new line in paragraph 10)
The propylene monomer contract was settled at €1,105/tonne ($1,364/tonne) FD (free delivered) NWE (northwest Europe), down by €125/tonne from its May level.
Several producers have indicated that they will pass on the monomer drop to PP prices in June, but buyers remain very cautious and often buy only what they need and only at the last minute.
“Every order is a battle. Every order is a struggle,” said one reseller.
Smaller converters are working on very low stock levels and only order the minimum amount they can use.
“They want material yesterday,” said a distributor.
“We spend more time discussing delivery times than prices at the moment,” another said:
A producer said: “We haven’t seen a sharp upturn in orders for June,” adding: “Demand has been low since the second half of April”.
The drop in the contract monomer price was prompted by the fall in naphtha prices in May. In April the average naphtha price was above $1,000/tonne CIF (cost insurance freight) NWE while on Thursday morning it was trading at just above $800/tonne CIF NWE, lower than when the June propylene contract was settled.
PP homopolymer injection net prices are trading around €1,200/tonne FD NWE at smaller and medium-sized accounts. Sources talk of lower levels for large lots but there is little interest for bigger volumes at present.
This is adding to nervousness in the PP market as another drop might be expected in July, exerting more pressure on monomer and polymer markets.
As well as low demand in Europe, there are not many export outlets at present as Asian markets falter and Turkey, a strong importer, looks towards Asia for a trend.
PP producers are now considering production cutbacks in a move to ensure no overhang of supply.
PP is used widely in the manufacture of household goods and in the automotive and packaging industries.
($1 = €0.81)
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|
Asian Chemical Connections