Europe's propylene imports slow on growing bearish sentiment for July on awaited return of supply

15-Jun-15

European imports of propylene from the US Gulf are expected to lessen in July following bearish propylene price expectations, as per Platts. "The arbitrage is quite slim considering we expect falls in July," a buyer said. Polymer grade spot prices in Europe were assessed at US$1176/mt CIF NWE, Thursday, falling US$25/mt on day. "We are seeing a reduction in imports and not because of a lack of vessels available but because there are not too many takers," a trade source said. Prices in the US were last assessed at 37 cents/lb FD USG equivalent to US$816/mt, with freight pegged at US$210-220/mt. Six US propylene shipments, totalling around 30,000 mt, had been heard fixed to Europe at the end of May with the price spread between both continents at similar levels to today's. The bearish sentiment has been growing as olefin supply is expected to return through June. Hungarian petrochemical company TVK's Olefin-2 steam cracker had restarted this week. Versalis' 440,000 mt/year Brindisi, Italy, cracker, BP Refining and Petrochemicals' Olefins-3 cracker in Gelsenkirchen, Germany and the NaphthaChimie cracker in Lavera, France, are all expected to restart the end of June: in total these three crackers make up around 6.7% of European capacity. Shell is expected to have product available from its steam cracker in Moerdijk, Netherlands, in H2-July the company previously said. Shell's cracker at the site has the capacity to produce 900,000 m tpa of ethylene, making it one of the largest crackers in Europe.