US December propylene contract prices settled Thursday at a 1-cent increase, at 50 cents/lb for polymer-grade product and 48.5 cents/lb for chemical-grade product, sources said.
All participants agreed to the settlement price, sources said.
The settlement was at the market's expectation, which had been talked anywhere from flat to up 1 cent/lb, sources said.
The settlement marks the sixth consecutive increase for propylene contract prices, and 8.50 cents above where contracts began the year, according to S&P Global Platts data.
Support for pricing came from an increase in spot pricing amid planned and unplanned steam cracker and propylene splitter outages. Additionally, supply is still talked on the tighter side because of Hurricane Harvey-related disruptions.
US spot polymer-grade propylene averaged 1.256 cents/lb higher in December than it did in November, and was last assessed Wednesday at 48.75-49.25 cents/lb FD USG for prompt-month (December) deliveries, unchanged day on day.
Refinery-grade product on a three- to 30-day basis averaged 1.824 cents/lb higher in December compared with November, and was last assessed Wednesday stable day on day at 36.75-37.25 cents/lb FD USG.
The PGP contract price is generally 2-3 cents above the spot PGP price at the end of the prior month and the beginning of the new month. Refinery-grade propylene pricing is also considered in the formula because it is a large source of PGP.
US propylene contract prices are settled on a monthly basis between major producers and buyers. The process includes price nominations by producers and subsequent negotiations with customers.
