Reduced supply pushes up PP prices in Italy
Mid-February hikes were attributed to tighter supply as well as higher upstream costs. According to players, LyondellBasell has declared force majeure on the PP output from their 185,000 tons/year plant in Ferrara due to technical issues. In upstream markets, spot propylene prices are up by €45/ton on the week to be quoted at €780-785/ton FD NWE due to upward pressure from higher naphtha costs.
A distributor issued further increases of €40/ton on his West European PP prices this week, bringing his total hikes to €60/ton compared to the beginning of the month. The distributor reported that he has almost sold out his allocation. Another distributor also reported lifting his PP prices by €20/ton for his limited volumes compared to early February levels.
A compounder received the latest February PP offers with increases of €60/ton compared to the beginning of the month when he made some purchases at levels as low as €940-950/ton FD Italy, 60 days. The buyer stated that lower prices have disappeared as sellers pushed up their prices citing tighter supply. Another compounder confirmed receiving new February offers with increases of €20/ton and added that he could only procure a limited part of his orders from a West European supplier.
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