For the Quarter Ending September 2024
North America
The third quarter of 2024 for Propylene in North America has been marked by a significant upward trend in prices, driven by a combination of supply constraints and increased demand from downstream industries. Maintenance shutdowns at key production facilities, unexpected outages, and delays in deliveries have all contributed to a tightening of supply, putting pressure on prices.
Additionally, rising costs of feedstocks such as propane have further fueled the price increase during July 2024. The market sentiment has been predominantly bullish, with consumers regaining confidence and resuming orders, particularly in the polypropylene sector. This resurgence in demand, coupled with seasonal consumption patterns, has led to a notable price surge.
However, the Propylene market faced low demand in the downstream polypropylene sector amid a decline in order books from the automotive industry which lowered the quotations during September 2024. The second half of the quarter saw a slight price increase of 2%, culminating in a quarter-ending price of USD 1110/MT of Propylene Polymer Grade CFR Manzanillo.
APAC
In Q3 2024, the APAC region witnessed a decrease in Propylene prices, followed by an uptrend. During July, logistical hurdles like container shortages and surging freight rates empowered sellers to raise prices. This bullish trend was further fueled by dwindling domestic supply caused by maintenance work at propane dehydrogenation plants. Adverse weather conditions, such as Typhoon Gaemi in the Philippines, Taiwan, and China, have disrupted industrial activities and transportation within the Asian market during August 2024. However, the market experienced a negative trend, primarily driven by subdued demand from the downstream Polypropylene sector during September 2024. Although Japan has faced transportation issues due to heavy rainfall and Typhoons, the supply of Propylene was unaffected due to the resumption of operations at several plants in South Korea, following maintenance shutdowns, which led to an oversupply of propylene in the Japanese market. The second half of the quarter saw a further decline of 2% in prices compared to the first half. The quarter-ending price stood at USD 840/MT of Propylene CFR Nagoya in Japan, reflecting the prevailing negative pricing environment in the region.
Europe
The Propylene market in Europe in Q3 2024 witnessed fluctuating prices driven by a variety of factors. Low demand from downstream industries, economic uncertainties, and reduced consumer interest in polymers contributed to the market decline during July 2024. Additionally, optimized production processes by European manufacturers helped manage inventories and mitigate the impact of rising freight costs. However, during August 2024 buyers showed little urgency to replenish stocks due to high freight charges which rebounded the Propylene prices during this timeframe. Although Europe has faced transportation issues due to the Red Sea, the supply of Propylene was unaffected during September 2024 due to the resumption of operations at several plants, following maintenance shutdowns, which led to an oversupply of propylene in the domestic market. In Germany, the market experienced the most significant price changes, reflecting broader trends in the region. The comparison between the first and second half of the quarter showed price stability, with no significant variations. The quarter-ending price for Propylene CIF Hamburg in Germany stood at USD 962/MT, reflecting the overall stable pricing environment in the region.
MEA
The third quarter of 2024 in the MEA region witnessed a downward trend in Propylene prices, with Saudi Arabia experiencing the most significant price changes. Players in the Middle Eastern propylene markets rolled over their quotations for July 2024 amid several vendors and buyers were being cautious due to sluggish downstream industry demand which made buyers reluctant to accept the increased price quotes. Additionally, the summer lull in Saudi contributed to a lack of consumer enthusiasm which declined the market activity as industry participants took advantage of the holiday period to recharge. However, due to supply-driven pricing pressure amidst logistical issues and an increase in freight charges, the market dynamics have rebounded during August 2024. Several factors influencing the decline included weakened demand from downstream sectors, particularly in polypropylene, coupled with decreasing production costs driven by lower crude oil prices which lowered the Propylene market during September 2024. The comparison between the first and second half of the quarter showed a slight decline of 1%. The quarter-ending price for Propylene FOB Al Jubail in Saudi Arabia stood at USD 846/MT, reflecting the prevailing decreasing sentiment in the pricing environment.
South America
In Q3 2024, the South American region witnessed a significant increase in Propylene prices, with Brazil experiencing the most notable price changes. The elevated production costs due to soaring crude oil prices during July 2024 made the Propylene prices higher. While demand from downstream sectors, including polypropylene, remained subdued, logistical challenges such as container shortages and elevated freight costs from the USA to Brazil, exacerbated by hurricane season in the USA following the floods in the southern state of Rio Grande do Sul enabled sellers to command higher prices during August 2024. However, the resumption of operations at several plants, following maintenance shutdowns, led to an oversupply of propylene in the Brazilian market during September 2024. Notably, the quarter-on-quarter increase of 15% accentuated the positive pricing environment. The correlation between price changes in the first and second half of the quarter remained steady at 1%, reflecting a consistent upward trajectory. Brazil, in particular, observed a bullish market scenario, culminating in the quarter-ending price of USD 1106/MT for Propylene Polymer Grade CFR Santos.
For the Quarter Ending June 2024
North America
The second quarter of 2024 has been a dynamic period for Propylene pricing in North America, predominantly characterized by an upward trend followed by a bearish market sentiment.
During April 2024, Propylene prices declined due to a recovery in supply. Two out of four propylene dehydrogenation (PDH) units in the US underwent planned maintenance during Q1 2024. One unit has resumed operation, adding to the available propylene in the market.
However, several pivotal factors influenced this bullish market sentiment. Key among these was a significant surge in demand from downstream industries, particularly the packaging sector, driven by the summer driving season. Additionally, geopolitical tensions and disruptions in critical trade routes, like the Red Sea, contributed to the escalation of freight charges. Concurrently, maintenance turnarounds at numerous petrochemical plants resulted in reduced inventory levels, further tightening supply. During June 2024, unforeseen disruptions along the value chains resulted in bottlenecks as the US Weather Service concluded an abnormally busy hurricane season this summer. The latest quarter-ending price for Propylene Polymer Grade DEL US Gulf was USD 1015/MT.
APAC
In Q2 2024, Propylene prices in the APAC region exhibited a mixed trend, from bearish to bullishness driven by a confluence of balanced supply-demand dynamics and external market conditions. During April 2024, a key driver of the low price was a surge in propylene supply across Asia. With the growing supply, buying interest in the Asian region for Propylene has dropped. Moreover, the softening propane prices have prompted the restart of several new propane dehydrogenation (PDH) plants, facilities that convert propane into propylene which further increased the supply. Uncertainty surrounding the post-May Day break likely caused a shift in downstream priorities as the downstream Polypropylene producers have prioritized meeting demand for essential goods, potentially reducing their procurement of propylene for non-essential applications. However, during June 2024, the prices of Propylene in Japan rebounded as Asian processors and resellers were actively buying propylene, fueled by the peak season for industries like textiles and packaging. This coincides with the unofficial start of summer, historically a period of increased propylene consumption. The quarter concluded with Propylene prices at USD 845/MT CFR Nagoya in Japan, reflecting a volatile pricing environment.
Europe
The second quarter of 2024 has been notably challenging for the European propylene market, characterized by a persistent decline in prices. This downward trajectory stemmed from several interlinked factors that significantly influenced market dynamics. Primarily, weak demand from downstream sectors, particularly the plastic and automotive industries, exacerbated the oversupply situation, leading to a bearish market sentiment. High inventory levels further compounded the issue, with producers struggling to find buyers despite reducing prices. The European Central Bank's efforts to stimulate economic activity through lower deposit rates failed to invigorate substantial investment in related industries, adding to the continued price pressures. Germany, experiencing the most pronounced price changes, reflected these overarching trends. Seasonality played a crucial role, with the anticipated peak demand during the summer driving season failing to materialize. This was partly due to economic sluggishness and increased import volumes from Asia and the Middle East, which kept local inventories elevated. The overall trend was a consistent price erosion, with a notable 87% decrease compared to the same quarter in the previous year, and a marginal 1% drop from the first quarter of 2024.
MEA
During Q2 2024, the propylene market within the MEA (Middle East and Africa) region exhibited a stable pricing environment, influenced by a mix of supply chain dynamics, geopolitical tensions, and seasonal demand fluctuations. Despite facing periodic disruptions from regional geopolitical tensions, propylene prices remained largely stable due to a balanced supply-demand equation and the industry's adeptness at navigating these challenges. The quarter experienced no significant deviations in pricing, as producers and consumers exercised caution in their trading strategies, ensuring that available inventory levels closely matched consumption rates. While the lowered feedstock Crude oil prices declined the production costs of propylene in May 2024 which lowered the prices. Increased freight costs and occasional supply shortages due to maintenance turnarounds at petrochemical plants also played a crucial role in maintaining price stability, albeit with a hike during June 2024. Focusing on Saudi Arabia, the propylene market here reflected the maximum price changes in the region, yet it maintained an overall stable trend. Seasonal demand, notably due to Ramadan and Eid Al-Adha festivities, influenced trading volumes, causing brief, predictable fluctuations.
South America
Throughout Q2 2024, the South American region witnessed a mixed trend from bearishness to bullishness in Propylene prices, driven by a combination of factors. In April 2024, the Propylene prices in Brazil declined which was attributed to the US market, a trend that exerted a direct influence on the Brazilian market given its significant dependence on Propylene imports from the USA. Several key events in March 2024 eased propylene availability in the US which created ample to the Brazilian market during this timeframe. However, severe logistical disruptions caused by adverse weather conditions tightened the availability of Propylene, exacerbating the supply-demand imbalance and pushing prices higher during June 2024. In Brazil specifically, the market experienced the maximum price changes, reflecting the overall trends in the region. The latest quarter-ending price for Propylene Polymer Grade CFR Santos in Brazil settled at USD 1043/MT, showcasing a volatile trajectory in pricing. Overall, the pricing environment in Q2 2024 for Propylene in South America has been predominantly positive, driven by supply chain disruptions, increased demand, and rising production costs.
For the Quarter Ending March 2024
North America
The first quarter of 2024 has seen a significant increase in Propylene prices in the North America region. Various factors have influenced market prices during this period. Supply constraints have played a major role, with several propylene plants undergoing maintenance shutdowns and experiencing technical issues. These disruptions have led to a tightening of supply and a decrease in readily available propylene. Additionally, declining stockpiles of propane and propylene have further exacerbated the scarcity and pushed prices higher.
Mexico, in particular, has witnessed the maximum price changes in the region. The market in Mexico has been heavily dependent on propylene imports from the USA, which experienced significant supply disruptions. This has led to expensive imports and a surge in propylene prices in Mexico.
Overall, the pricing environment for propylene in the North America region has been positive, with prices increasing steadily. Seasonality has also played a role, with demand typically picking up after the Lunar New Year holidays. There has been a correlation between supply constraints, declining stockpiles, and the upward price trend. In terms of percentage change, there has been a 26% increase in propylene prices from the previous quarter in 2024.
APAC
The Propylene pricing dynamics in the APAC region for Q1 2024 were influenced by a balanced to bullish market sentiments. While the market situation remained stable, the supply and demand dynamics were moderate to high, resulting in a gradual increase in prices. The key contributing factors included the surge in energy costs and the shutdown of several plants, such as Hyosung Corporation's Ulsan plant in South Korea, which disrupted supply and impacted prices. The market situation in South Korea was most pronounced, with a steady demand for the product market, which helped to maintain the pricing trend. The post-holiday season and the Lunar Year festivities led to a temporary incline in demand during February 2024. The first half of the quarter showed a slight increase in prices, while remained unchanged in the second half, resulting in a balanced pricing trend. In conclusion, the final quarter's price for Propylene FOB Busan in South Korea was USD 823/MT, reflecting a stable market situation and a gradual increase in prices driven by a mix of supply and demand dynamics and other contributing factors such as energy costs and plant shutdowns.
Europe
The first quarter of 2024 has been a period of increasing prices for Propylene in the European market. Several factors have influenced these price changes, including supply constraints, limited availability of Propylene, and disruptions in shipping routes. These factors have led to tight supplies and higher freight costs, resulting in higher import prices for Propylene. Moreover, increased demand in downstream sectors and a seasonal slowdown have impacted the market, further contributing to the upward price trend. In Germany, the price changes have been more pronounced compared to other countries in the region. The percentage change in prices compared to the same quarter last year is significant, with a 56% increase. The quarter-ending price for Propylene CIF Hamburg in Germany is recorded at USD 1135/MT. Overall, the pricing environment for Propylene in the European market, particularly in Germany, has been positive and characterized by increasing prices. The tight supply conditions and limited availability have driven prices higher, while decreased demand and seasonal factors have also contributed to the upward price trend.
MEA
The first quarter of 2024 has been marked by increasing prices for Propylene in the MEA region. Several significant factors have influenced market prices during this period. The overall trends in the market have been positive, with prices experiencing a steady increase. Seasonality has also played a role, with the demand for Propylene typically higher during this time of the year. In Saudi Arabia, the price changes have been the most significant. Interestingly, the Advanced Petrochemical Company's deliberate shutdown of its propylene and polypropylene units may have played a significant role in the price hike. The domestic propane market had a tight spot flow as a result of this planned maintenance, which was started on February 4 till 29th February 2024 created a tight spot market. The percentage change from the same quarter last year is 17%, indicating a substantial increase in prices. The latest quarter-ending price for Propylene FOB Al Jubail in Saudi Arabia is USD 866/MT. This price reflects the overall positive pricing environment in the region during Q1 2024.
South America
In Q1 2024, the Propylene pricing dynamics in the South America region experienced a significant hike. While plant shutdowns played a significant role in price increases, other factors also contributed to the market situation. In Brazil, where price fluctuations were most pronounced, the overall trend was bullish throughout the quarter due to supply constraints. The market was heavily reliant on imports from the USA, and any disruptions in the US market had a direct impact on pricing in Brazil. Plant shutdowns, such as the maintenance shutdowns at Dow Chemical and LyondellBasell in Texas, limited the supply of Propylene. Additionally, Enterprise Products Partners L.P. in Mont Belvieu, Texas exerted a Force Majeure on their Propylene plant, further tightening the market supply. These shutdowns and supply disruptions led to scarcity levels and a surge in import prices of Propylene in Brazil. It is important to note that the market situation in Brazil was also influenced by seasonality, with the post-holiday season leading to factory shutdowns and potential supply shortages.
For the Quarter Ending December 2023
North America
The North American Propylene market in Q4 2023 witnessed a significant surge during this timeframe due to the enhanced demand observed in the downstream PP industry and expensive imports from overseas, such as from the USA during October and November 2023.
A plant shutdown occurred at the INVISTA plant in Houston and Enterprise Products Partners L.P., Texas, from 1 Nov to 22 Nov 2023 which affected the market shipments during this timeframe. Mexico's economic activities were affected by high inflation and a slowdown in the manufacturing sector, which significantly impacted the chemical industry's operations. The Propylene Polymer Grade CFR Manzanillo in Mexico witnessed a 43% increase in prices from the previous quarter, with a -7% price decline in the second half of the quarter compared to the first half.
However, the cautious approach of local traders, driven by the costs associated with importing Propylene, particularly from the USA, played a pivotal role in sustaining a declining market trend. Despite the challenges posed by global uncertainties, the downstream Polypropylene (PP) industry maintained a consistent and moderate demand for Propylene, reinforcing the resilience of the Mexican market. The quarter-ending price of Propylene Polymer Grade CFR Manzanillo in Mexico was USD 969/MT during December.
APAC
The Q4 of 2023 was a challenging period for the Propylene market in the Asia-Pacific region with a decline in November while the prices slightly edged up during December. Overall, the Propylene market in the Asia-Pacific region remains challenging, primarily due to the ongoing supply-demand imbalance influenced by the price of crude oil. The market experienced a bearish trend due to the sharp decline in the price of its feedstock, crude oil, which fell by approximately 1.9% globally. The decline in demand has led to a significant rise in upstream inventory levels, contributing to the supply-demand imbalance within the Propylene market. The market witnessed low demand from downstream industries, leading to a downturn during November 2023. However, a slight uptick in demand and new inventories entering the market among the suppliers are likely to keep the market situation strong. South Korea experienced a moderate supply of Propylene, which was ample enough to satisfy domestic and international demand, but the demand was low from downstream plastic industries. The price of Propylene FOB Busan in South Korea was USD 806/MT during December.
Europe
The European Propylene market witnessed a mixed quarter in Q4 of 2023, with prices experiencing notable fluctuations. The market sentiment was primarily influenced by a complex interplay of factors, including abundant availability of the product in the global market, and low demand from downstream industries in December, while the high production costs surged the pricing dynamics during October and November. During October the German market stood out with a slight increase in prices despite low demand from the downstream Propylene Glycol industry. This increase was attributed to expensive imports from overseas and the influence of an optimistic market situation. However, the market situation remained bearish with high supply and low demand, maintaining an average hoarding sentiment. The price trend for Propylene decreased at the end of the quarter to settle at USD 838/MT of Propylene CIF Hamburg in Germany. Overall, the market faced challenges due to low demand and high supply, leading to fluctuating prices at the end of the quarter.
MEA
The MEA region's Propylene market experienced stability throughout Q4 2023, with consistent supply and demand from downstream industries. The market was impacted by various factors, including ample global availability of products, low demand from the downstream plastic industry, and destocking activities in the region. Among the MEA countries, Saudi Arabia witnessed the most significant changes in Propylene prices, with a notable 6.7% decrease in prices during November. The decline in prices was parallel to the drop in crude oil prices which played a crucial role in driving market growth during this time. The international crude oil market has been marked by fluctuations and an overall downward trend recently. Contributing to this dynamic, the rebound in OPEC exports has exerted pressure on oil prices, with the Middle East region witnessing an increase in its export share due to a seasonal decline in internal demand. The price comparison of the current quarter with the previous quarter showed a decrease of 12%. The comparison between the first and second half of the quarter showed a 3% decrease in prices, with the latest price of Propylene FOB Al Jubail in Saudi Arabia for Q4 2023 being USD 610/MT.
South America
The South American Propylene market witnessed a volatile Q4 2023, marked by significant price fluctuations. The top three factors that impacted the market were the stable supply of domestic products, moderate demand from the downstream Polypropylene (PP) industry, and the surge in new inventories entering the market among suppliers during November. Brazil, the largest importer of Propylene in the region, experienced a period of stable domestic product supply and moderate demand from the downstream PP industry during December. Moreover, the price percentage comparison of the first and second half of the quarter was 2%. The latest price of Propylene Polymer Grade CFR Santos in Brazil at the end of Q4 2023 was USD 979/MT. However, the market was affected by high production costs and hurdles in trading activities due to winter during November. Additionally, there has been a modest increase in demand from the downstream polypropylene (PP) industry, contributing to a favorable pricing trend for the product. Moreover, companies in the manufacturing sector were displaying resilience and determination in the face of adversity, raising the potential for continued expansion during this timeframe.
