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US September propylene contracts settling with increase
HOUSTON, October 1, 2017 (PCW) -- US September propylene contracts are settling at 46.5 cpp for polymer grade and 45 cpp, up 7 cpp from August. The agreement is not market-wide.
Contracts began the year at 41.5 cpp for PGP and 40 cpp for CGP, and reached a high of 52 cpp (PGP) and 50.5 cpp (CGP) in March.
Spot PGP has traded from 42 cpp at the start of September to 48.25 cpp at the end of the month.
The 30-day September weighted average for PGP was 44.254 cpp Friday, up 5.535 cpp from August. The 45-day August weighted average for PGP was also 44.254 cpp, up 6.818 cpp from August.
On the feedstock side, spot refinery grade propylene (used to feed PGP and CGP splitters) last traded at 35 cpp in mid-September, but was bid up to 37 cpp. Spot propane (used to feed PDH units), averaged 88.744 cpg in September (or the equivalent of 21.1 cpp), compared with 75 cpg so far this month (or the equivalent of 17.73 cpp) in August.
Operationally, most splitters and steam crackers that had shut due to Hurricane Harvey in late August were said to be at normal rates or at close to normal rates. As a result of these outages, force majeures had been declared by Chevron Phillips and Enterprise Products Partners. Olefins production at Cedar Bayou, Deer Park and La Porte remain shut. Dow began a scheduled turnaround at its olefins units at St Charles in the week of September 25. Output from PDH units was still a general concern given that those units had struggled with various operational issues prior to Harvey. Meanwhile, Enterprise said start-up of its new 1.65 billion lbs/yr PDH unit at Mont Belvieu would be delayed three weeks because of Harvey, putting a start-up date in late October. -- Samantha Hartke