| The settlement of the monthly propylene contract with a €170/ton decrease in Europe has intensified the downward trend in place in Italy’s PP market for two and a half months. Sellers are approaching the market with hefty decreases for July while the low end of the local spot market is expected to break below a new threshold, as per ChemOrbis. Along with these sustained decreases, Italy’s PP market appears to have lost its traditional premium over the nearby Turkish market, where PP prices have been on a rather stable to soft trend since the beginning of June. European cargoes are being offered almost at par in both markets although Italy traditionally sees higher levels in its local market. The major reasons behind this situation are the ample supplies and unsatisfactory demand across Europe. A West European producer who issued a €150/ton decrease for July PP gentlemen’s agreements said to ChemOrbis, “Given ample supply and unsatisfactory demand, we may have to concede to the full propylene decrease amount.” The company source also opines that demand is not likely to improve in the midst of the approaching summer holidays in August while supply remains long in the region. |
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