Propylene (Asia-Pacific)
By Julia Tan
29-Oct-2021
Overview Outlook Prices Upstream Downstream Production
Please click here for full details on the criteria ICIS uses in making these price assessments.
OVERVIEW
Northeast Asian sentiment bearish amid Chinese losses
Derivative futures markets plunge on governmental policies
Southeast Asian sentiment sees slight uptick
Spot propylene prices in the CFR NE Asia market fell by roughly 5.4% week on week, as Chinese government
policies led to plunging prices in the derivative polypropylene (PP) futures market.
With ample supply in the Chinese domestic markets due to the recent start up of new capacities, the Shandong
domestic daily markets also saw day-on-day losses throughout the week.
As such, bearish market sentiment for the northeast Asian markets persisted, and generally led to lower tradable
levels.
However, southeast Asian propylene markets saw a slight uptick in sentiment, amid slightly tighter supply on the
back of a turnaround and unexpected shutdown.
OUTLOOK
Spot liquidity could increase in the following week
Supply might be curbed amid high feedstock prices
Weak derivative margins for PP could lower demand
PRICES
SPOT PRICES
Price Range Four Weeks Ago US CTS/lb
Propylene
CFR NE Asia USD/tonne -60 1020-1080 -60 980-1020 46.27-48.99
CFR China Main Ports USD/tonne -60 1020-1080 -60 980-1020 46.27-48.99
CFR SE Asia USD/tonne -70 930-990 -50 900-940 42.18-44.91
FOB NE Asia USD/tonne -30 1000-1020 -50 950-980 45.36-46.27
FOB South Korea USD/tonne -30 1000-1020 -50 950-980 45.36-46.27
FOB SE Asia USD/tonne -70 835-895 -50 805-845 37.88-40.60
Domestic propylene prices decreased sharply.
The market was affected by the polypropylene (PP) futures market this week. PP margins were poor. Market
players took a wait-and-see attitude, with downstream producers buying propylene on a hand-to-mouth basis.
Discussions were limited in some regions. This, combined with ample supply, exerted selling pressure on
propylene producers.
Domestic prices in China Ex-tank prices, CNY/tonne Change from previous week
Shandong 7,800-8,650 -1200/-750
East China 7,950-8,600 -500/-300
In China, the average run rate of methanol-to-olefins (MTO) units was at
61%.
Click here for more analysis on the import/export markets
Deals & discussions concluded in week ending 29 October
Price ($/tonne) Incoterms No of cargoes* Date range
Spot Deal 1,010** CFR NE Asia 1 End-November
Arrival
Spot Deal 1,050*** CFR CMP 1 Early December
Arrival
Spot Deal 1,080 CFR CMP 1 Early December
Arrival
Offers/Selling 1,000-1,080 FOB NE Asia - Mid-November to
indications Early December
Loading
Bids/Buying 950-1,020 FOB NE Asia - Mid-November to
indications Early December
Loading
Offers/Selling 1,030-1,110 CFR NE Asia - End-November to
indications (mainstream levels Early December
fell within 1,050- Arrivals
1,100)
Bids/Buying 1,000 to 1,100 CFR NE Asia - End-November to
indications (mainstream levels Early December
fell within 1,020- Arrivals
1,070)
*Pressurised unless otherwise stated
**Not used to form the assessment as deal could not be verified by the market's close.
***Not used to form the low end of the assessment as market players underlined that viable mainstream trading
levels had fallen below such levels by the week's close. The deal was concluded earlier in the week.
The high end of the CFR NE Asia assessment was assessed softer, reflecting a deal concluded at $1,080/tonne
CFR CMP in the week.
The low end of the CFR NE Asia assessment was assessed softer, reflecting mainstream workable levels heard
from the market.
The low end of the CFR CMP assessment was assessed softer, reflecting mainstream workable levels heard from
the market.
The FOB NE Asia and FOB Korea price was assessed softer on the basis of mainstream workable levels heard from
the market in the week, as trade continued to be thin, with suppliers looking to offer cargoes on a floating basis
instead amid market volatility.
A deal was heard to have been concluded at $1,020/tonne FOB Korea in the week, but could not be verified, and
was excluded from consideration as regards the assessment.
In the southeast Asia market, most market players polled said the average price gap between CFR SE Asia and
CFR NE Asia should be around $90/tonne.
The FOB SE Asia range (mid-point) was lower, taking into account the CFR SE Asia (mid-point) prices and
prevailing freight rates (mid-point).
Contract prices in Taiwan
The latest settlements between a key producer and its end users were heard around $1,105/tonne DEL,
according to market sources.
Click here for details.
Freight rates*
Freight cost ($/tonne) Route Cargo size (tonnes)
195-205 UAE/Saudi Arabia to SE Asia 5,000
230-240 UAE/Saudi Arabia to NE Asia 5,000
70-120+ Intra-SE Asia 1,500 and above
75-95 Intra-NE Asia 1,500 and above
150-175+ SE Asia to NE Asia 1,500 and above
150-175+ NE Asia to SE Asia 1,500 and above
*According to market sources
UPSTREAM
Click here for the Asia feedstocks and petrochemicals weekly summary.
DOWNSTREAM
Downstream Spread - Propylene and PP SE Asia
The price spread was higher after PP prices rose in the region. With some propylene demand sprouting from
southeast Asia, the price spread could be negatively impacted in the near future.
Click here to see the ICIS Topic Page Directory, for information on crucial downstream industries such as the
automotive and construction sectors, along with the latest updates on global developments impacting the
markets.
PRODUCTION
South Korea's LG Chem shut its Daesan cracker on 29 September.
South Korea's Hyosung set to shut its no 2 PDH in mid-November.
China's Sinopec Guangzhou has shut its cracker for maintenance.
China's Nanjing Chengzhi has shut its No 2 MTO plant.
China's Sinopec Zhongyuan has shut its MTO plant.
In Taiwan, CPC Corp has shut its residue fluid catalytic cracking (RFCC) unit until November.
In southeast Asia, Malaysia's PRefChem has delayed its cracker and RFCC restart to Q4 2021.
Thailand's PTTGC commences turnaround for Map Ta Phut PDH unit.
Singapore's SRC shuts FCC on technical issues.
Click here for the Live Disruptions Tracker.
Propylene (Asia-Pacific) | 29-Oct-2021. ICIS accepts no liability for commercial decisions based on the content of this report.
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