Ample supply pulls down spot propylene prices in Europe
The spot propylene market marked its fourth weekly decline, dropping almost €80/ton on an FD NWE basis at the end of last week. As a result of the recent losses, spot propylene is now traded at a larger discount compared to the September contract level.
Supply was reportedly ample in line with the arrival of import cargoes, which was the main reason behind the fall in spot propylene prices, according to traders in the region. Even though major producers, including Dow, Borealis, LyondellBasell and Ineos, have either started or are preparing to start planned maintenance shutdowns, Naphthachemie’s full rates at its steam cracker and the arrival of imports weighed down the market.
Concerns over ample availability were also voiced in the Asian market due to new capacities as well as the incoming import cargoes while these news are yet to have an impact on the spot propylene market. In South Korea, Hyosung Corporation started commercial runs at its new PDH unit at Ulsan through mid-August. The plant has a capacity to produce 300,000 tons/year of propylene. Yeochun Naphtha Cracking Center (YNCC) also started up a new olefins conversion unit (OCU) in Yeosu in early September. The new unit has a propylene capacity of 140,000 tons/year. China’s Wanhua Chemical reportedly reached on-spec output at its 750,000 tons/year PDH unit at Yantai, Shandong in end-August.
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