Initial nominations for US polymer-grade and chemical-grade November propylene contract prices call for a 2-cent decrease at 74.5 cents/lb and 73 cents/lb, respectively, market sources said Monday.
ExxonMobil Chemical is the only producer with propylene contract nominations announced as yet, sources added.
If the nomination is accepted market-wide, it will mark the first decrease since June, when prices dropped 3 cents/lb from May to 67.5 cents/lb and 66 cents/lb for PGP and CGP, respectively.
October contract prices settled at 76.5 cents/lb for polymer-grade and 75 cents/lb for chemical-grade material, both at their highest levels since February 2013.
Sources said the decrease is less than expected, as recent refinery startups and declining ethylene spot prices have led to increased production from metathesis units, which in turn has led to lower spot PGP prices.
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.
Spot RGP was heard offered Monday at 60 cents/lb via railcar.
November PGP was heard traded twice on Friday at 71.5 cents/lb MtB-pipe, while December was heard traded at 71.25 cents/lb MtB-pipe. Platts last assessed spot PGP and CGP on Friday at 71.25-71.75 cents/lb delivered and 68.25-68.75 cents/lb delivered, respectively, while RGP was assessed at 59.75-60.25 cents/lb delivered.
