SAN ANTONIO--US supply of propylene oxide (PO) is adequate but could tighten before new capacity comes online, a source said on Sunday.
"If the global economy picks up, then PO could tighten up pretty quickly," the source said on the sidelines of the International Petrochemical Conference (IPC).
PO is the feedstock for monopropylene glycol (MPG).
MPG demand increases in line with overall economic growth, and projections for MGP growth had been expected to cause tightness in upstream PO by 2020, ahead of new capacity.
Construction continues on a LyondellBasell PO/tertiary butyl alcohol (PO/TBA) plant, which is expected to be complete in 2021.
However, the market softened in late 2018 which slowed MGP demand growth and has kept PO supplies from tightening.
Major US MPG and PO producers include Dow Chemical, Huntsman and LyondellBasell.
Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 24-26 March in San Antonio, Texas.