Propylene prices in Asia continue to sink in line with crude values, falling to four month lows. Coupled with weakening downstream polypropylene demand from China, prices have fallen by another 70 dollars to US$1130/MT FOB Korea. This could lead to a reduction in operating capacities in the continent. Last week, prices in Asia dipped by about 300 dollars as many PP and ACN makers in Asia cut back operating rates to 70-75%.
Corresponding with weakening crude oil prices, persistent oversupply in the region and deteriorating market sentiments in Europe and USA benzene prices have plunged to nine-month lows, currently rising marginally to US$1075/MT FOB Korea.
As exports by Asian producers to the US markets are no longer finding buyers, it could result in further oversupply in Asia. Hence, most market players anticipate a further deterioration in the next quarter.