ICIS publishes our reliable and trustworthy propylene oxide report in Asia, Europe and the US on a weekly basis. Independent and unbiased pricing assessments are quoted for spot and contract, depending on the region. Our locally-based reporters gather market intelligence to compile commentary to include insight into demand and supply movements, upstream and downstream trends, trade and production data and any other key influencing factors that may impact prices in the market at the time.
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Propylene Oxide Overview Transcript
Propylene oxide or PO is a highly reactive liquid and is an important intermediate in the production of polyether polyols and monopropylene glycol MPG.
PO is produced via three main technologies in Asia: chlorohydrin, POSM or styrene monomer and HPPO or hydrogen peroxide to PO processes.
The Asian market has both spot and contract prices, Japan contract prices take a steer from naphtha contract prices, whereas the South Korea contract and the China spot prices are dependent on a key feedstock: propylene.
Japan contract prices take a steer from naphtha contract prices, whereas the South Korea contract and the China spot prices are dependent on a key feedstock: propylene.
Other raw materials such as chlorine and hydrogen peroxide, are also price-determining factors, dependent upon technology used.
In China, which is both the largest producer and consumer in the world, most PO units use chlorohydrin technology. So fluctuations in the local chlorine prices have a significant impact on Chinese PO prices.
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Propylene oxide: Market overview
Updated to Q4 2016
In the US, there are four major producers of propylene oxide (PO), with the bulk of production being captive, typically for integrated downstream operations. The ICIS monthly contract assessment is a calculation based on the price of feedstock propylene. PO pricing for Q4 2016 will depend on prices for upstream propylene and crude oil. No issues with PO availability in the US were noted in early October.
In Asia, PO prices in Q4 will likely correct following an upsurge in September. Chinese domestic prices were driven up by panic buying ahead of environmental checks on plants in Shandong province during October, but are expected to decline after the checks are completed in a month or two.
European PO supply and demand are in balance in early Q4. Following on from the upward propylene contract movement for October, the formula PO price for this month is likely to rise, while freely negotiated business is also likely to head higher due to healthy demand and feedstock gains.
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Propylene Oxide Methodology
About Propylene oxide
Propylene oxide (PO) is a very volatile, colourless, flammable liquid with a characteristic ether-like odour. PO reacts violently with chlorine, ammonia, strong oxidants and acids causing fire and explosion hazards.
Propylene oxide is a highly reactive chemical used as an intermediate for the production of numerous commercial materials. The largest derivative of PO is polyether polyols, one of the main components used in the manufacture of polyurethanes. Propylene glycol (PG) is the second largest PO derivative.
Propylene oxide is made traditionally by chlorohydrin or epoxidation routes. The propylene oxide/styrene monomer (PO/SM) epoxidation process had been gaining in popularity due to its superior economics. However, new PO technologies that do not made coproducts have now been commercialised.
General downstream PO sectors include bedding and furniture; construction and automotive.
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