Propylene settlement to have little effect on MPG prices

25 October 2013 14:50  [Source: ICIS news]

LONDON (ICIS)--Next week’s propylene feedstock settlement is unlikely to have any influence on monopropylene glycol (MPG) industrial grade prices in November as demand is strong and availability is tightening, market sources said Friday.

MPG prices have been on the rise since August, according to ICIS data, after being flat between June and July due to low summer demand – settling at €1,200-1,250 FD (free delivered) NWE (northwest Europe) last week.

The August rise was mainly due to the propylene settlement which settled €50/tonne ($69/tonne) higher at the end of July.

“MPG prices should be up again in November because of [high] demand and low availability,” a producer said. “It does not matter happens with propylene, [we are expecting] a slight decrease but it will have no influence [on MPG pricing due to market fundamentals].”

A trading source confirmed demand and prices are on the rise but added that reports of a tight MPG market are exaggerated.

“Availability is good, I do not see a shortage at all,” a trader said. “We would be getting a lot more orders [if that were the case].”

MPG is predominantly used as de-icing fluid by airports and airlines which tend to start restocking early in preparation for the winter months.

By: Stefan Naidu
+44 208 652 3214

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