US January propylene contracts settle at a rollover

HOUSTON (ICIS)–US January propylene contracts settled at a rollover from the prior month for the majority of the market on Friday, despite falling spot prices during the negotiations.

The settlement puts January polymer-grade propylene (PGP) contracts at 33.0 cents/lb ($727/tonne) DEL (delivered) and chemical-grade propylene (CGP) contracts at 31.5 cents/lb DEL.

Inventory levels remain high as global demand for propylene and its derivatives continues to be weak due in part to macroeconomic concerns and trade tensions.

The main outlet for propylene is as a feedstock for polypropylene (PP). Propylene is also used to produce ACN, propylene oxide (PO), a number of alcohols, cumene and acrylic acid.

Major US propylene producers include Chevron Phillips Chemical, ExxonMobil, Flint Hills Resources and Shell Chemical.

Major buyers include Arkema, Ascend Performance Materials, Braskem, Dow, INEOS, Oxea and Total.

Thumbnail image shows bottle caps, which are often made of PP. Source: Eye Ubiquitous/REX/Shutterstock