NWE spot propylene supply sparse as producers hold back: sources

Propylene supply in Northwest Europe turned scarce as many producers retreated from the spot market while they assess their options in a weakening market, industry sources said. 

Producers found offers too low and would rather store their product for the time being and focus on contract obligations rather than sell, they added. Several traders said they had difficulty securing supply for export, which they continued to explore as an alternative route given the demand slump in Europe. 

"There's not a lot of product on offer anymore. The big volumes have disappeared," a trader said. Another trader agreed, saying he was turned down by several suppliers he approached over the past few days for November material. 

OUT OF EUROPE A producer said a trader who approached him was only willing to pay Eur725/mt ($1,005/mt) FOB. "I have no interest to sell at these prices," he said. 

Another producer said the "distressed" products had been siphoned out of Europe following the series of exports to Asia and the US over the past month or two. 

"Everyone is just trying to manage their inventory," he said. Asian propylene prices fell $98/mt Friday week-on-week to $1,320/mt CFR China due to poor demand. At freight cost of around $300-350/mt, European traders estimated they had secured supply at around $1,000/mt FOB for exports to make sense. Several producers talked up price indications last week, at ranges heard at around Eur850-900/mt FD NWE for polymer grade. No deals were heard done last week as European buyers remained scarce.