Europe petchems buyers continue to prefer propane over naphtha

27 March 2014 17:11  [Source: ICIS news]

LONDON (ICIS)--European petrochemical buyers are keeping naphtha purchases at a minimum, while propane continues to be popular as an alternative feedstock for cracking, industry sources said on Thursday.

Propane was trading at a discount of $140-148/tonne to naphtha on Thursday. A petrochemical buyer said: "So propane is pretty weak. At these prices I expect some heavy propane cracking by some who can."

In general, steam crackers in Europe are set up to switch only 25% of their production to liquefied petroleum gas (LPG).

Nevertheless, there is a huge variation as newer crackers often have more flexibility in switching between the feedstocks, while older crackers are often unable to crack propane.

"Ethylene is of low value, so that will have to be considered in cracking propane," the petrochemical producer said.

Depending on the cracker in question, propane yields more ethylene than naphtha, industry sources said.

"Propane yields more ethylene. They will have to decide between the low ethylene prices and low propane prices," the producer added.

By: Cuckoo James
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