Petrotahlil -US May propylene contracts settled at a rollover from April, as rising feedstocks and less refinery production are being counter-balanced by coronavirus-softened demand.
The rollover puts May polymer-grade propylene (PGP) contracts at 26.0 cents/lb ($573/tonne) DEL (delivered) and chemical-grade propylene (CGP) at 24.5 cents/lb DEL.
The settlement ends a five-month streak of contract price decreases.
Spiking propane prices have altered propylene dynamics by decreasing the profitability of on-purpose propylene production and encouraging ethane cracking, which yields little propylene.
Compressed on-purpose margins, less cracker co-production and low refinery output are pressuring up propylene prices but not enough to outweigh the coronavirus impacts on demand.
These counter-balancing fundamentals have kept US propylene spot prices mostly steady month on month.
Front-month PGP traded in May at 21.50-24.00 cents/lb, compared with 21.25-24.75 in April.
The main outlet for propylene is as a feedstock for polypropylene (PP). Propylene is also used to produce acrylonitrile (ACN), propylene oxide (PO), a number of alcohols, cumene and acrylic acid.
Major US propylene producers include Chevron Phillips Chemical, Enterprise Products, ExxonMobil, Flint Hills Resources and Shell Chemical.