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.
If you’re involved in this market, ICIS can provide you with this essential tool to make informed and confident business choices.
Updated to Q4 2019
Propylene oxide (PO) supply in the Asian market observed mixed trends in the fourth quarter, with production rates in the China market hovering stably in the 70-80% range, ICIS data showed. Unforeseen outages were seen, though prolonged impact was limited as affected plants came back on stream soon after. In the market outside of China, a South Korea-based PO plant was shut during October to November for scheduled maintenance. As such, supply was tightened temporarily.
Lacklustre performance in downstream sectors such as polyether polyols and mono propylene glycol (MPG) in the fourth quarter weighed on cargo uptake for PO. Some buyers were also approaching procurement with caution, as they sought to keep inventories lean ahead of the year-end closing of accounts. Others remained uncertain over the near term economic outlook and opted to stay by the sidelines, whereas some buyers preferred to wait to purchase after the festive season.
Propylene oxide (PO) supply was plentiful in Q4 as demand into its largest end use, polyols, which accounts for almost two-thirds of demand, was weakened by an ongoing slowdown in the automotive sector. This meant that more material was available at integrated polyols sellers internally. Material was again channelled into the monopropylene glycol (MPG) market and extra volumes were offered to PO merchant buyers. Planned plant outages during the quarter had no impact on the market.
PO demand was mixed in Q4, depending on end use. Offtake into the MPG sector increased as stockpiling for the winter de-icer season began, but slowed seasonally into construction. However, downstream polyols demand was impacted by the slow automotive sector. Other downstream markets, such as propylene glycol ethers, were impacted by the slower economy. Offtake into the food sector was more stable as this is less impacted by lower GDP.
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Over 80% of propylene oxide (PO) goes into two main uses: polyether polyols (60%) and propylene glycol (21%).
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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