31 July 2012 10:36 [Source: ICIS news]
LONDON (ICIS)--The August European propylene contract price has settled at €1,055/tonne ($1,287/tonne), up by €120/tonne from July, following a revision of the initial August settlement, a major consumer said on Tuesday.
The initial agreement at €1,065/tonne – up by €130/tonne from July – on 27 July failed to find support from remaining propylene contract parties.
A sizeable increase had been widely expected on the back of a firmer feedstock market, which has taken cracker margins back to “unsustainable” levels last seen in January.
However, derivative demand remains very fragile and there is little optimism for much of an improvement in August, not least because it is the traditional summer holiday period.
The contract, agreed on a free delivered (FD) northwest Europe (NWE) basis, has been confirmed by two consumers and two producers, which establishes it as a benchmark contract price in Europe.
Confirmation is pending from another two consumers and a third producer also reported to have agreed the new number.
($1 = €0.82)
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