Asia : Brake on rising propylene prices in previous week

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Brake on rising propylene prices in previous week

08
Sep '10

The recent rising trend of the Asian propylene market stopped in the just past week, mainly due to price decline in China, weakening of buying interest, softening of market, unclear downstream market trends and finally instability of oil prices.

Polypropylene (PP) manufacturers said they could not afford propylene price of US $1200 / ton (CFR Northeast Asia) or higher, buying intention from downstream markets was less than or close to $1200 / ton (CFR Northeast Asia).

Prices in Shandong market in China fell from 10,000 Yuan / ton (to be delivered) at the beginning of the week to 9300-9600 Yuan / ton. However, buyers were cautious. Bids were close to $1180 / ton (CFR China), while quotations were around $1200-1210 / ton.

In the Japanese market, propylene prices firmed up earlier in the previous week, due to unexpected repair of cracker owned by Mitsui Chemicals, which unexpectedly shut down its naphtha cracker plant located at Ichihara, with capacity of 617,000 tons / year, on August 26.

The plant is expected to resume production in a few days time, after which only, the tight supply situation will be eased.

In Northeast Asia, spot propylene price trends fell slightly to $1180-1210 / ton (CFR Northeast Asia), reflecting the level of market bargaining.

Cargo with September delivery was quoted at $1200-1220 / ton (CFR China), buyers showed no interest in the offer, but were willing to accept at $1180-1190 / ton.

In Southeast Asia, propylene spot price fell to $1,110-1,140 / ton (CFR South East Asia), reflecting the level of market bids and offers. Market supply was moderate, but transactions were few, as market traders are in the midst of the Ramadan period.

In the FOB Southeast Asian market, spot price fell by $10 to $1030-1060 / ton (FOB), purchase intention from Chinese market declined. Most cargoes with September shipment have already found buyers via tender.

Fibre2fashion News Desk

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