US spot polymer-grade propylene traded below the 50-cent/lb level for the first time in 31 months Monday, further fueling talk in the market that June contracts might fall by more than 10 cents/lb, sources said.
PGP for June delivery was heard traded via broker at 48.25 cents/lb MtB pipe, with sources cautioning the deal was for a small volume.
That said, the same sources said the level was likely reflective of the market, as June PGP was subsequently talked in a range of 47.50-49.50 cents/lb MtB pipe.
"Forty-eight [cents/lb] is a real spot PGP price in the current weak market," a veteran olefins trader said.
Platts last assessed spot PGP on Friday at 50.75-51.25 cents/lb delivered. Platts assesses PGP on a weekly basis.
Spot PGP was last assessed below the 49-cent/lb level for the week ending November 6, 2009, when the assessment was 46.938 cents/lb, according to Platts data.
At these levels, PGP contracts for June could fall by as much as 15 cents/lb, the trader said. Recent market expectations had called for a decrease of 8-10 cents/lb.
"Looks like we won't find the bottom just yet," a polypropylene source said.
PGP contracts last settled for May at 67.50 cents/lb, down 10 cents from the previous month.
Spot refinery-grade propylene was also talked lower to start the week, heard offered at 42 cents/lb against no bids. Spot RGP was last assessed Friday at 43.75-44.25 cents/lb delivered.
