Participants anticipated that November contract prices could fall by as much as 3-4 cents/lb, given the delta between spot and contract.
October spot PGP was last heard offered this week at 55.25 cents/lb MtB pipe. Buyers were absent though. Sources pegged spot at 55 cents/lb or lower. With October contracts settling 1.5 cents lower at 58.50 cents/lb, the gulf between the CP and spot was 3.50 cents/lb.
Lower spot was attributed to pending supply improvements as supplier Petrologistics was expected to start up its new 500 kt/year propane dehydrogentation unit at Houston, Texas. The start up has been delayed several times, and the company was heard to be aiming for a start up by the end of
this week. The plants output is expected to be 70% CGP and 30% PGP, a company source said.
The decline in monomer prices was felt downstream. Sources in the US PP market talked pricing lower this week amid improved availability. Homo injection rail cars were offered as low as 64 cents/lb delivered. Adding 2.5 cents/lb for bagging would bring the FAS offer to near to 66.50 cents/lb
or $1,466/mt. That price is down from early September when homo injection was near $1,532/mt FAS Houston.
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