Shell Chemicals nominated its September US chemical-grade propylene contract price at 72 cents/lb, itself a rollover from August, sources said Thursday.
A company source familiar with pricing could not be reached to confirm the nomination.
The nomination followed ExxonMobil Chemical’s nomination for US polymer-grade and chemical-grade September propylene contract prices, which called for a 1-cent increase at 73.5 cents/lb and 72 cents/lb, respectively, multiple sources said last week.
Market participants expected the September CPs would decline as much as 1-cent/lb, following weak demand from polypropylene producers and refinery-grade propylene prices that were hovering below the 60 cents/lb level.
In markets, September PGP bids were heard Thursday at 69 cents/lb Mont Belvieu-pipeline basis, against offers heard at 70.75-71 cents/lb MtB-pipe. September PGP was last heard traded on August 28 at 71.5 cents/lb MtB-pipe. September RGP was heard bid at 56.5 cents/lb MtB-pipe and traded last week at 57.5 cents/lb
US propylene contracts are settled on a monthly basis between major producers and buyers. The process includes price nominations by producers and subsequent negotiations with customers.
The contract price is generally 2-3 cents above the spot PGP prices seen at the end of the prior month and the beginning of the month set for negotiations. Additionally, refinery-grade propylene pricing is also considered, as that is the source of a large volume of PGP.
– Platts.com
