Rebound in US propylene inventories after recent fall to 13 month lows

29-Oct-10

After plunging to a 13 month low last week, US propylene stocks posted slight rebounds this week, as per Platts. Propylene inventories gained roughly 11,000 barrels to close at 2.122 mln barrels for the week ending October 22, according to data released by the Energy Information Administration. Despite the increase, inventories remained at their lowest levels since September 2009. Wednesday's figures marked a 1.072 mln barrel decline in inventory levels since the beginning of the year. October spot PGP was offered this week at 55 cents/lb, though buyers were largely absent. Sources pegged spot slightly below that level leading some to expect a 3-4 cent decrease in the November propylene contracts. In spot, November PGP continued to be offered at 55 cents/lb MtB pipe, but buyers were few as some expected prices to move lower going forward. One factor that could contribute to lower prices was the recent start up of Petrologistics new propylene plant at Houston, Texas.