17 July 2013 16:42 [Source: ICIS news]
HOUSTON (ICIS)--US July propylene contracts initially settled at mixed deltas, sources confirmed on Wednesday, putting their gap back at typical levels.
Buyers confirmed that US polymer-grade propylene (PGP) contracts settled at a rollover while US chemical-grade propylene (CGP) contracts gained 1 cent/lb ($22/tonne, €17/tonne).
The July initial settlements put PGP at 65 cents/lb and CGP at 63.5 cents/lb.
This restores the premium of PGP to CGP to 1.5 cents/lb, its typical level. June contracts saw PGP increase by 3 cents/lb and CGP by 2 cents/lb, widening the gap for the first time since March 2011.
Sources said the higher June increase for PGP was mostly fuelled by stronger demand compared to CGP.
Nominations for July propylene contracts were for a 1 cent/lb increase in PGP and a 2 or 4 cent/lb increase in CGP.
However, demand has softened for propylene, leading to a drop in spot prices in the past week.
Major US propylene producers include Chevron Phillips Chemical, ExxonMobil, LyondellBasell, PetroLogistics and Shell Chemical.
Major buyers include Ascend Performance Materials, Dow Chemical, INEOS and Total.
($1 = €0.76)
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