Propylene markets in the United States showed a mixed performance last week, with refinery-grade propylene (RGP) recording modest gains while polymer-grade propylene (PGP) remained largely unchanged as sentiment stayed cautious.
According to an industry source, RGP prices edged higher, buoyed by stronger bids in the railcar sector and spillover momentum from earlier gains in the PGP market. “Refinery-grade propylene prices increased in the United States, bolstered by higher polymer-grade propylene prices and rising bids in the railcar sector. Although pipeline trading was quiet, railcar discussions intensified as buyers grew more active. Bids outpaced offers, reflecting steady demand from both end-users and traders aiming to capitalize on arbitrage opportunities,” the source explained.
Despite the uptick, market players noted that liquidity remained thin, with few confirmed deals. Many emphasized that the increase was sentiment-driven, linked closely to PGP pricing trends rather than signaling any fundamental shortage of RGP. Sellers appeared in no rush to place volumes, which added to the sense of tightness, though overall refinery operations were reported as stable.
On Friday, RGP spot delivered prices were assessed at 31.50–32.00 cents per pound FD US Gulf, up 1.00 cent from the previous week.
By contrast, PGP spot prices were unchanged, assessed at 31.50–32.00 cents per pound FD US Gulf. Market discussions were subdued, even as reports surfaced of temporary supply interruptions at a propane dehydrogenation (PDH) unit over the weekend. The outage had minimal short-term impact, as stockpiles were deemed sufficient to meet immediate needs.
Participants indicated that both buyers and sellers adopted a wait-and-see stance, with attention focused on the pending August contract price settlement. Negotiations were ongoing, with stakeholders weighing whether contract values would reflect recent disruptions or remain aligned with steady market fundamentals.
In the contract market, US propylene contracts for August settled lower at 35.50 cents/lb for PGP and 34.00 cents/lb for chemical-grade propylene, both down 2.00 cents from July. Sources said the reductions underscored the continued balance of adequate supply and moderate downstream polypropylene demand, leaving spot PGP trading confined within a narrow range.
Looking ahead, traders remarked that significant shifts in US propylene pricing are unlikely unless inventory levels tighten sharply or polypropylene demand stages a meaningful recovery. Until then, RGP is expected to track sentiment from PGP, while overall market conditions remain stable but unremarkable.
