11 October 2012 20:39 [Source: ICIS news]
US PP contract prices for October were at 64.00-66.00 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 prices settled higher at 53.00 cents/lb for October.
The increase was somewhat unexpected, according to some market participants, who had expected October prices to settle flat or fall slightly.
"I don't think anybody expected an up number," said one broker, who added that PGP continues to trade below the contract price.
The price increase had no real impact on PP demand, which buyers and suppliers described as generally weak. However, the increase in contract prices, along with slightly improved availability, has caused spot PP prices to come closer into line with contract numbers, sources said.
"I wouldn't say there is a ton more material available, but I will say that what is available is a lot closer to the market price," a trader said.
Market participants said they expect prices to remain mostly stable through the balance of the year, with no huge swings up or down.
Major North American PP producers include LyondellBasell, ExxonMobil, INEOS, Total, Formosa Plastics, Braskem Americas, Pinnacle Polymers, Phillips 66 and Flint Hills Resources.
($1 = €0.78)
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