06 August 2013 20:37 [Source: ICIS news]
HOUSTON (ICIS)--US spot refinery-grade propylene (RGP) reached a five-month high on Tuesday, tracking tight supply.
Sources said US August RGP traded at 60 cents/lb ($1,323/tonne, €992/tonne), breaching the 60 cent/lb barrier for the first time since early March.
A trade was done on 6 March at 63.5 cents/lb, fuelled mostly by strong demand and high prices for gasoline.
The recent run-up in spot propylene prices has been based on tight supply, as one producer is down and another has declared a force majeure (FM) and sales allocation, sources said.
Demand for RGP from the plastics market has been steady, while demand from the gasoline pool has been moving up slightly.
There is some talk that US propylene prices are moving too high too quickly and that supply is not as dire as the market is saying.
Some sources added that the surge in pricing could lead to some pre-buying in the propylene and polypropylene (PP) markets, which could lead to a quick fall.
($1 = €0.75)
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