Polypropylene Price Continues to Face South in the US Market

Polypropylene Price Continues to Face South in the US Market

Polypropylene Price Continues to Face South in the US Market

  • 20-Jul-2022 5:32 PM
  • Journalist: Nicholas Seifield

Houston, USA- Polypropylene remains on track for another monthly decline amid continued downward pressure from fundamental indicators. Constant price erosion in the feedstock propylene market alongside ample supply further creates an inevitable decline in upcoming August contracts. Piling inventories and a weak purchasing appetite forced the producers to revise the product prices for the overseas suppliers.

With the week ending on 15th July, the price of Polypropylene in the US slipped to USD 1700/ton (Blow molding grade) FOB Texas.

Total Energies lifted its force majeure on Polypropylene (PP) at its La Porte facility in Texas last week, which will further affect the prices in the forthcoming weeks. In the USA, Quantix, Supply Chain Services company, had decided to increase their storage price for the next quarter to clear out their growing inventories in their warehouse. In terms of Logistics, the transportation cost increased, and rail logistics remain the primary issue in the region as the potential rail worker strike looms.

Downstream food packaging and plastic industries remain under pressure from rising inventories and muted market fundamentals. However, support for the price trend brought by ongoing construction projects in which polypropylene usage is tepid. In overseas markets, conditions remain the same as in North America as European Union (EU) prices continue to freefall on the back of ample supply and weak demand.

Feedstock propylene prices also faced south on the offset of weak purchasing and fluctuations in energy and Naphtha values.

According to ChemAnalyst, the price of Polypropylene will further slip with declining contract prices in the region. Heartland’s unit in Canada will also increase Polypropylene production in the upcoming months. It will start its PDH unit in Q3, bringing additional feedstock propylene capacity to the industry. Fear of recession in the US and fluctuations in Natural Gas will affect the price dynamics in the domestic market.


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