The Week in Chemistry: US PE contracts seen rising US$0.03/lb for January, PP producers seek US$0.03/lb contract hike in addition to cost-related increase; China recovery seen driving demand for propylene, durable plastics, paraxylene

Sample article from our Chemicals Industry

LOS ANGELES , February 3, 2023 () –


US Resins

US resin trading for the week of January 23 remained subdued, with spot prices keeping the previous weeks’ gains without increasing further.

PE producers have pushed for contract increases of US$0.05/lb, though industry groups foresee $0.03/lb as a more realistic figure.

Production of PE continues to be affected by force majeure conditions at Chevron Phillips’ production site in Baytown Texas. However, processors have been able to find adequate supply in general. 

PP producers will look for margin increases of $0.03/lb in January and $0.06/lb in February, on top of cost-related increases as polymer-grade propylene costs rise.

PP inventories hit their lowest in 16 months at the start of January after high levels of exports in December, in addition to reduced production.

The primary source of this information is Plastics Today.


China Plastics Demand

China’s demand for durable plastics could improve in 2023 as propylene demand makes a comeback, according to Chris D’Anna, Enterprise Products Partners SVP of petrochemicals.

A rebound in China could play a role in global demand recovery later in the year, D’Anna notes.

Spot polymer-grade propylene prices were assessed at US$0.4375/lb on Jan. 31, while US contracts settled at $0.43/lb in January, an increase of $0.11/lb over December, Platts data shows.

Enterprise plans to start a 750,000-tonne/year propane dehydrogenation unit in Q2 2023.

The primary source of this information is S&P Global Platts.

Asia Paraxylene

Asia paraxylene spot prices reached record highs in January, hitting US$1,082/tonne CFR Taiwan/China on January 30 as markets anticipated a spike in Chinese demand.

Following the Lunar New Year holidays, buyers in China are expected to replenish thin inventories.

In addition, markets are expecting a seasonal lag in PX and other aromatics coming from the US.

Overall, aromatics demand in Asia and the West remain healthy.

The primary source of this information is S&P Global Platts.

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