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Polypropylene prices increase in August

ExxonMobil Chemical

ExxonMobil Chemical briefly halted polypropylene production at its Baton Rouge, La., plant due to Hurricane Francine.

North American polypropylene resin prices increased by an average of 2 cents per pound in August, marking the third consecutive monthly price hike for the material.

The August PP increase was influenced by prices for polymer-grade propylene monomer feedstock. PP prices had climbed 5 cents in July and 2 cents in June.

The July hike also was tied to higher PGP prices, as well as supply concerns over brief outages caused by Hurricane Beryl, which hit the Houston area in early July.

Hurricane Francine, a weaker storm that hit Louisiana on Sept. 11, caused brief shutdowns at PP units operated by ExxonMobil Chemical in Baton Rouge and by Pinnacle Polymers in Garyville, but those moves aren't expected to have much of an effect on the overall market, sources said. The region is home to about 20 percent of U.S. production of PP and PGP.

According to market sources, Invista is expected to lift force majeure supply limits at its PP unit in Longview, Texas, by the end of September. Ineos Olefins & Polymers USA continues to have force majeure supply limits in place at its PP unit in Alvin, Texas.

By the end of the year, Formosa Plastics Corp. USA is expected to open a new PP line with 550 million pounds of annual production capacity in Point Comfort, Texas.

Combined with previous increases and decreases, PP prices now are up a net of 7 cents so far in 2024.

Recent drops in oil prices soon could play a role in lower prices for PGP in North America, according to a report from PP supplier BlueClover LLC of New York. West Texas Intermediate crude oil prices were at $80 per barrel on Aug. 12 but had dropped under $66 by Sept. 10, a decline of 17.5 percent. Prices had recovered from that point and were at $71.40 in late trading Sept. 13.

"Our primary reason for lower PGP pricing centers around the fundamentals of increasing PGP supply and softening PP demand at today's price levels," BlueClover officials said. "In addition, it's difficult [for PGP] to be the only proverbial ship that can weather a global commodity price correction."

* Source : https://www.plasticsnews.com/resin-pricing/polypropylene-prices-increase-august

* Edit : HANDLER