14 May 2013 17:44 [Source: ICIS news]
HOUSTON (ICIS)--A recent increase in spot prices for polymer-grade propylene (PGP) on Tuesday could lead to a reversal of direction in US May propylene contract settlements.
Initially, US producers nominated a decline of 1 cent/lb ($22/tonne, €17/tonne) and 3 cents/lb for May propylene contracts. The second producer then revised its nomination to a decline of 1 cent/lb.
Since the nominations, US PGP spot prices have moved higher by 3.00-3.75 cents/lb, tracking stronger demand.
With a spot trade done at 61.25 cents/lb on Tuesday, the typical premium of 2-3 cents/lb on contract material over spot could lead to a May settlement between 63-64 cents/lb.
April contracts for PGP settled at 63 cents/lb, and at 61.5 cents/lb for chemical-grade propylene (CGP).
Typically, US propylene contracts are settled in the first part of a month for that month.
Major US producers of CGP and PGP include Chevron Phillips Chemical, ExxonMobil, LyondellBasell, PetroLogistics and Shell Chemical.
Major buyers include Ascend Performance Materials, Dow Chemical, INEOS and Total.
($1 = €0.77)
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