14 February 2013 17:50 [Source: ICIS news]
HOUSTON (ICIS)--US February propylene contracts fully settled on Thursday, sources confirmed.
Buyers and sellers said February contracts gained 6 cents/lb ($132/tonne, €98/tonne) for polymer-grade propylene (PGP) and chemical-grade propylene (PGP).
The settlement puts February PGP contracts at 79 cents/lb and CGP contracts at 77.5 cents/lb.
Sources said the increase came on the back of a stronger spot market and tighter supply in January, although the upward momentum stalled at the start of February.
Initial nominations for February propylene were increases of 7 cents/lb and 9 cents/lb.
The supply concerns were eased after a cracker restart in early February, pushing spot PGP prices lower by 1.25-1.50 cents/lb in the first full week of February.
However, spot PGP prices were still 3.00-5.75 cents/lb higher from prices seen four weeks ago.
With February settling at a high level, sources said demand is expected to drop, which should push prices lower in the second quarter.
February PGP was heard bid at 65 cents/lb on Thursday, with offers at 68 cents/lb.
US propylene contracts normally settle at the beginning of the month being negotiated.
Major US producers of PGP and CGP include Chevron Phillips Chemical, Enterprise Products, ExxonMobil, LyondellBasell, PetroLogistics and Shell chemical.
Major buyers include Dow Chemical, INEOS, Ascend Performance Materials and Total.
($1 = €0.74)
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