Initial nominations for April US polymer-grade and chemical-grade propylene contract prices call for a 1-cent decrease at 48 cents/lb and 46.50 cents/lb, respectively, market sources said Thursday.
The nominations came from ExxonMobil Chemical as no other producers have announced April nominations, sources said.
If the nomination is accepted marketwide, it will mark the second consecutive decrease.
The last initial nomination to call for a decrease came in January when PGP and CGP prices were nominated for a 8-cent drop at 53.5 cents/lb and 52 cents/lb for PGP and CGP prices, respectively. January later settled at 49.5 cents/lb for PGP and 48 cents/lb for CGP, both at a 12-cent/lb decline from December’s price.
Market sources talked of weakened propylene demand, ample supply and a drop in ethylene and overall oil prices as the main reasons for the decrease in PGP values.
US propylene contracts settle monthly. The process includes price nominations by producers and subsequent negotiations with customers. The contract price typically lands 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.
Spot RGP was bid Thursday at 35 cents/lb Mont Belvieu pipeline basis and offered at 41.50 cents/lb MtB-pipe. Spot PGP was bid at 42.50 cents/lb MtB-pipe.
– Platts.com
