Platts: Global Petrochemical Prices Rose Nearly 2% In September

Prices in the $3-trillion-plus global petrochemicals market rose 1.9% in September to $1,388 per metric ton (/mt), the fourth consecutive month of price gains, according to the monthly Platts Global Petrochemical Index (PGPI) report released today, coinciding with the European Petrochemical Association (EPCA) annual meeting in Berlin. The PGPI is a benchmark basket of seven widely used petrochemicals and is published by Platts, a leading global energy, petrochemicals and metals information provider and a top source of benchmark price references.

On a year-over-year basis, the PGPI data showed petrochemical prices were up 2.3% from the September 2012 average of $1,357/mt.

Petrochemicals are used to make plastic, rubber, nylon and other consumer products and are utilized in manufacturing, construction, pharmaceuticals, aviation, electronics and nearly every commercial industry.

PLATTS GLOBAL PETROCHEMICAL INDEX IN DOLLARS PER METRIC TON

The daily price reflected as a monthly average

OLEFINS
Olefins – a group of hydrocarbon compounds which are the building blocks to many petrochemicals – had mixed fortunes, with a 4% year-over-year decline in ethylene prices, while propylene prices rose 13% year over year.
 
“Global propylene prices were supported by the €110/mt ($141/mt) rise in European contract prices over the last four months, due in part to stronger polypropylene demand, planned or unscheduled plant outages, and persistently strong prices of naphtha, the main feedstock for steamcracker operators in Europe and Asia,” said Shahrin Ismaiyatim, Platts editorial director, petrochemicals analytics. Commenting from the sidelines of the EPCA, Ismaiyatim went on to say, “However, early indicators of October price patterns are indicating that the rise in propylene prices may have reached its peak.” 
 
Ethylene, the first olefin component in the PGPI, posted a $31/mt rise in September to $1,292 /mt, representing a 2% gain from July. Meanwhile, propylene prices averaged September at $1,367/mt, up $18/mt or 1% month over month.
 
POLYMERS
Prices of polymers – the raw material for plastics – continued to post modest gains in September as Chinese buyers restocked their inventories ahead of the week-long holiday in October. In addition, polyethylene suppliers to Latin America cited optimism in the polymers markets ahead of Brazil decreasing its polyethylene import tariff from 20% to 14% from October 1.
 
Meanwhile, China’s General Administration of Customs showed August imports of low-density polyethylene were up 6% from July, while imports of other grades of polyethylene showed decreases.
 
The Platts Global Low-Density Polyethylene Index climbed 2% in September to $1,663/mt, up from $1,628/mt in August. The Platts Global Polypropylene index, the second polymers component in the PGPI, was also up 2% in September to $1,618/mt, from 1, 588/mt in August.
 
Petrochemical prices in September performed in line with the global equity markets. The Dow Jones Industrial Average (DJIA) closed September at 15,129.67, up 2% from August, while the London Stock Exchange Index (FTSE) was up a marginal 0.3% at 6462.20. The Nikkei 225 was up a strong 8% in September to 14,455.80.
 
To access a summary of the September performance of each of the seven key petrochemicals included in the PGPI, visit this link: http://www.platts.com/newsfeature/2013/Petrochemicals/pgpi/index.
 
The PGPI reflects a compilation of the daily price assessments of physical spot market ethylene, propylene, benzene, toluene, paraxylene, low-density polyethylene (LDPE) and polypropylene as published by Platts and is weighted by the three regions of Asia, Europe and the United States. Used as a price reference, a gauge of sector activity, and a measure of comparison for determining the profitability of selling a barrel of crude oil  intact or refining it into products, the PGPI was first published by Platts in August 2007.
 
Published daily in a real-time news service Platts Petrochemical Alert and other Platts publications, the PGPI is anchored by Platts’ robust and long-established price assessment methodology and the firm’s 100-year history of energy price reporting.
 
Platts petrochemicals experts are available for media interviews. A sample list of experts may be found at the Platts Media Center. For more information on petrochemicals, visit the Platts website at www.platts.com.