ICIS has extensive coverage of the Polypropylene markets and our network of locally-based experts deliver reliable and trustworthy pricing information on a weekly basis. Price reports are published from Africa, Asia, southeast Asia, Middle East, China, CIS, Europe, Turkey, US and Latin America.
There are also weekly margin reports in Asia, China, Europe and the US assessing a short-term three-month view and longer-range view. Forecast reports looking forward a year and 12-month rolling series reports are also compiled for Asia, Europe and the US. This high-value news and analysis is an essential business tool to assist market players when making crucial decisions
Updated to Q1 2019
Global polypropylene (PP) supply levels will remain limited in 2019, with little in the way of new production coming online. Demand fluctuations in other countries could lead to restricted availability in Africa. Strong pull from China could see stocks directed into Asia. Stocks are low in the country and this may put pressure on buyers if African demand levels rise.
PP demand may improve in the latter half of the quarter, assuming that Chinese order levels also increase following the Lunar New Year holiday period. Chinese buyers often come back from the vacation in need of materials. A spike in Chinese prices could drive a similar trend in Africa, as players have to compete for limited volumes.
The price gap between dutiable and non-dutiable PP cargoes is likely to remain narrow with the recent regional start-ups. Spreads between homopolymer and copolymer grades could be maintained, at least in the near term, as the bulk of the fresh start-ups have been mainly focused on homopolymer grades.
The bulk of converters were holding on to relatively low inventories, having procured cargoes on a hand-to-mouth basis for most of Q4 2018 and hence, many have room to stock-up on resins should they chose to. How buying momentum in Q1 2019 fares hinges on sentiment in the upstream markets, as well as demand in China.
A series of planned cracker maintenance outages is expected to curtail propylene supply into 2019. Several producers have made precautionary provision for extra propylene supply, but some reduction in polypropylene (PP) is also expected. Most buyers are relaxed, however, and do not expect any interruption in supply. Quarter one is not expected to feel much of the effect of the shutdowns, which are expected to impact the second quarter mostly.
Polypropylene (PP) demand was disappointing for some sellers in December, but there was some nervousness over 2019 supply (see supply), so this was expected to have a positive impact on demand, and some stocking was expected to take place. Adversely this could affect demand in the second quarter if no supply issues emerge.
PP supply in the Middle East in Q1 is set to increase from Q4 2018 levels as two out of the three producer units who faced outages have resumed normal operations. This, coupled with the seasonal lull during the Lunar New Year in China is likely to dampen prices across regions including the Middle East. Weaker Chinese demand during the holiday may also prompt Middle Eastern sellers to allocate more volumes to other regions.
Demand is likely to strengthen in Q1, as regional processors look to re-stock inventories early in the year. However, the extent to which demand strengthens could be offset by any volatility in crude, and also the introduction of the value added tax (VAT) in Bahrain, as buyers may delay or curb purchases while adjusting to the workflows and paperwork surrounding the new tax regime.
Supply levels are likely to deteriorate at the beginning of 2019. There is little in the way of new production and ready materials have been exhausted, as players currently prefer them to fresh imports. An increase in prices in another competing region may see allocations re-directed there, due to poor nature of Turkish demand.
Demand levels are not expected to show any significant increase in the first quarter, although there is hope that the economy should recover to some extent this year, it is expected to be a slow process. Limited availability may force spikes of demand but there is no appetite to buy anything beyond basic requirements.
High inventory levels for feedstock propylene indicate that PP supply will continue to improve in the first quarter. Import availability will stay long in the early months of the quarter as previously purchased cargoes will arrive in the US in January and February. Plant issues which plagued the market in 2018 have largely been resolved.
Demand is anticipated to remain largely constant in the first quarter with better demand for domestic material and the resumption of export activity working to balance out seasonal sluggishness during the winter months. Economic growth is expected to remain solid in North America while global growth may slow.
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Polypropylene (PP) is one of the most versatile of the bulk polymers. Its intrinsic properties of high stiffness, good tensile strength, good processability and inertness towards acid
This document is intended to provide methodology support for customers receiving the ICIS Weekly Margin – PP Asia report.
This document is intended to provide methodology support for customers receiving the ICIS Weekly Margin – PP China report.
Polypropylene Europe Margin Report Methodology
This document is intended to provide methodology support for customers receiving the ICIS Weekly Margin – PP Europe report.
The ICIS Polypropylene (PP) price forecasting model is a brief monthly publication that can be accessed via the Dashboard.
The main method of PP manufacture is by using refinery grade propylene (RGP), produced by a refinery, to convert to polymer grade propylene (PGP) through a superfractionation unit.
The ICIS Polypropylene (PP) USA price forecast report is a monthly publication that can be accessed via the Dashboard.
Polypropylene (PP) is a colourless, translucent to transparent solid with a glossy surface. It has good resistance to acids, alkalis, inorganic chemicals and organic chemicals with the exception of hydrocarbons and chlorinated compounds.
It has improved impact strength, a higher softening point, lower density, better stress cracking and more scratch resistance than other polyolefins. However, a disadvantage of this polymer is its brittleness at low temperatures.
Polypropylene was first produced in a slurry process using Ziegler-Natta catalysts. Bulk phase technologies were then developed while higher activity catalysts enabled gas phase processes to be used. A combination of bulk phase tubular and gas phase reactors has become a popular process.
PP has key applications in packaging, fibres and automotive parts. PP can be extruded for pipe, conduit, wire and cable, while atactic PP has outlets in paper laminating, sealants and adhesives.
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