27 June 2013 19:49 [Source: ICIS news]
HOUSTON (ICIS)--US June polymer-grade propylene (PGP) and chemical-grade propylene (CGP) contracts settled by different amounts for the first time since 2011, sources confirmed on Thursday.
Buyers and producers confirmed that June PGP contracts moved up by 3 cents/lb ($66/tonne, €51/tonne), while CGP contracts increased by 2 cents/lb.
This puts US June PGP contracts at 65 cents/lb and June CGP contracts at 62.5 cents/lb.
The split in movement is the first for propylene since March 2011, when PGP contracts fell by 5 cents/lb and CGP contracts fell by 1 cent/lb.
The increase in PGP came in line with expectations and a nomination for an increase of 3 cents/lb.
Market sources said spot trading of PGP strengthened in June, with deals completed between 62.000-63.375 cents/lb, compared with 59.250-61.750 cents/lb in May.
The increase was mostly attributed to buyers continuing to replenish inventories, higher feedstock costs for refinery-grade propylene (RGP) and some tightness of supply.
US CGP contracts experienced a smaller increase as demand was not as strong, sources said.
The split settlement widens the gap between PGP and CGP to more than 1.5 cents/lb for the first time since February 2011, when the gap was 5.5 cents/lb.
Major 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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