US PP margins rise on drops in propylene, naphtha

HOUSTON (ICIS)–US polypropylene (PP) margins increased during the week on declines in the cost of feedstocks propylene and naphtha, the ICIS margin report showed on Monday.

Integrated contract PP margins from refinery-grade propylene (RGP) increased by 2.29 cents/lb this week as RGP prices fell by 2.25 cents/lb, according to the report.

Integrated contract PP margins (naphtha) rose by 1.14 cents/lb as naphtha costs collapsed by 6.6% on a $20/tonne drop. Co-product credits tumbled by 10.7% on the lower settlement of the benzene and butadiene contract prices and lower pygas values.

The average January integrated contract margin (naphtha) of 33.36 cents/lb jumped almost 34% or 8.41 cents/lb higher than the December margin of 24.95 cents/lb because of the collapse in naphtha costs.