Weakening demand has pressured a drop in spot propylene prices in USA by about 6%, amid looser supply. As per ICIS, refinery-grade propylene (RGP) for April was offered earlier this week at 52.50 cents/lb (US$1157/ton), falling steadily since it last traded at 56 cents/lb on 5 April. RGP inventories rose by nearly 8% in the week ended 2 April vs the previous week to 2.349 mln barrel, reflecting a steady increase in refinery operating rates in recent weeks. US refineries ran on average at 84.5% in the week ended 2 April, rising from 82.6% a week earlier and 80.5% in mid-March, according to the US Energy Information Administration (EIA).
The surprising fall in RGP prices suggest the work of motivated sellers. RGP is a key US source for chemical (CGP) and polymer-grade propylene (PGP), accounting for around 60% of US propylene output in 2009, according to data from the National Petrochemical & Refiners Association (NPRA).