For PCW's methodology on its assessments and weighted monthly average calculations, click HERE
PGP SPOT PRICE SUMMARY
Spot PGP prices continued dropping this week, but appeared to find a floor at 45 cpp. Nov MtB-EPC PGP began the w eek trading at 45.25 cpp, w hich w as dow n a penny from the previous Friday. Nov traded at 45 cpp on Tuesday and Wednesday and ended the w eek at
that value, bid at 44 cpp and offered at 46 cpp. Some forw ard paper trade interest w as seen this w eek, w ith 1H 2019 trading at 47.75 cpp and 2Q 2019 trading at 47.5 cpp on Monday and calendar 2019 trading tw ice at 48 cpp on Tuesday.
The MTD 30-day w eighted average for Nov MtB-EPC PGP w as 45.729 cpp, compared w ith 55.271 cpp in Oct. The MTD 45-day weighted average for Nov MtB-EPC PGP was 46.921
cpp, compared w ith 55.438 cpp in Oct.
In the monthly contract market, no news was heard regarding Nov pricing. The Oct con-tract price w as 60 cpp for PGP and 58.5 cpp for CGP.
TRADE VOLUME SUMMARY
So far this month, 72 million pounds of PGP traded for Nov delivery, compared with 47 million pounds of current month PGP during all of Oct. No forw ard physical trade volume transacted this w eek, compared w ith 68 million pounds dur ing all of Oct. MTD spread trade
volume w as 10 million pounds so far this month, compared w ith no volume transacted during Oct. No index trade volume w as seen this w eek, compared w ith 22 million pounds in Oct. MTD paper trade volume w as 32.4 million pounds, compared w ith 103.4 million pounds in Oct.
OPERATIONS & NEWS
Enterprise's 1.65 billion lbs/yr PDH unit at Mont Belvieu, TX w as f laring again this w eek due to an unspecif ied process issue.
In general news, Westlake executives said during an earnings related call this w eek that the company's new ethane cracker in Louisiana is expected to start up during 1H 2019. They also noted that a turnaround at the company's Lake Charles Petro 2 olefins unit previously planned to occur during 2H 2019 has been rescheduled to take place dur ing 1H 2020.
INTERNATIONAL
US PGP prices w ere slightly below those in Asia (46.3 cpp FOB Korea and 48.5 cpp CFR NE Asia), and far below those in Europe (51.5 cpp).
PGP SPOT PRICES
($/lb) Friday 1-Week Δ 1-Month Δ
Nov Mt B-EPC (TX) 0.45000 -0.01250 -0.11500
Dec Mt B-EPC (TX) 0.45000 -0.01000 -0.11000
PGP TRADING RANGES
($/lb) LOW HIGH MIDPOINT
Current Week Mt B-EPC 0.45000 0.45250 0.45125
Current Week ALL TX 0.45000 0.45250 0.45125
Nov 30-Day MtB-EPC 0.45000 0.47000 0.46000
Nov 30-Day All TX 0.45000 0.47000 0.46000
Nov 45-Day MtB-EPC 0.45000 0.52250 0.48625
Nov 45-Day All TX 0.45000 0.52250 0.48625
PGP WEIGHTED SPOT AVERAGES
($/lb) MTD avg 1-Month Δ 1-Year Δ
Nov 30-Day MtB-EPC 0.45729 -0.09542 -0.01412
Nov 30-Day All TX 0.45729 -0.09542 -0.01412
Nov 45-Day MtB-EPC 0.46921 -0.08517 0.00242
Nov 45-Day All TX 0.46921 -0.08517 0.00242
PGP CALENDAR SPOT AVERAGE
($/lb) MTD avg 1-Month Δ 1-Year Δ
Nov 0.45643 -0.08748 -0.01333
PCW’s PROPYLENE SYSTEM MAP
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Physical pipeline connections into plant and storage locations.
Rail racks, truck racks and terminals.
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Spot RGP prices fell again this w eek. Nov MtB-EPC pipeline RGP traded at 33 cpp on Mon-day and at 32 cpp and 31.75 cpp on Thursday. Oct had ended the month last w eek at 35 cpp.
The MTD 30-day Nov pipeline w eighted average w as 32.25 cpp, compared w ith 45.278 cpp in Oct. The MTD 30-day w eighted average for Nov all-TX RGP for all transport modes w as also
32.25 cpp, compared w ith 45.278 cpp in Oct. The MTD 45 -day w eighted average for Nov MtB-EPC pipeline RGP w as 35.125 cpp, compared w ith 45.3 cpp in Sep. The MTD 45 -day weighted average for Nov all-TX RGP by all transport modes w as also 35.125 cpp, compared w ith 46.094 cpp in Sep.
REFINERY OPERATIONS SUMMARY
Motiva restarted its FCC, CDU and a hydrotreater at its Port Arthur, TX refinery ear ly this w eek follow ing a pow er outage over the w eekend. LyondellBasell began restarting the coker and CDU at its Houston refinery this w eek. Both units w ere shut on Sep 17 for a planned overhaul. Citgo continued repairs at the coker at its Corpus Chr isti, TX (West) refinery. The unit w as shut Sunday after a leak w as detected. BP is expected to return the CDU at its Whiting, IN
refinery by mid-Nov. The CDU and a coker w ere shut on Sep 18 for a planned overhaul. All units at Total’s Port Arthur, TX refinery returned to service Thursday after a brief pow er inter-ruption on Wednesday. Monroe Energy is expected to restart its Trainer, PA refinery by Nov 17. The facility w as shut for planned w ork that began in late Sep. A sulfur recovery unit at the
site began restarting on Thursday. Shell took dow n the hydrocracker at its Norco, LA refinery after a malfunction on Thursday.
US Gulf refinery utilization w as up 0.2 percentage point at 96.7%. Refineries operated at 90%, up from 89.4% the previous w eek.
EIA STOCKS
US nonfuel use propylene inventories shot up for a fourth straight w eek, rising 505,000 bbls to 3.728 million barrels last w eek, the EIA said. It w as the largest w eekly inventory build in over a
year, and it brought propylene stocks to their highest level since Jan 2017. Propy lene invento-ries have risen in eight of the past tw elve w eeks and are up nearly 1.7 million bbls over the past four w eeks.
DOWNSTREAM & ASSOCIATED MARKETS
The average implied (formula) pr ice of cumene w as 35.912 cpp so far in Nov, compared w ith an average of 42.966 cpp in Oct. RGP’s alkylation value w as 40.721 cpp so far this month, compared w ith 47.936 cpp in Oct.
PGP's premium to RGP expanded to 13.25 cpp, keeping splitter economics positive. Propane prices averaged roughly 78.679 cpg (18.6 cpp) so far this month and PDH economics re-mained very favorable. Ethylene prices w ere 25 cpp below PGP, keeping economics for run-ning metathesis units very attractive.
NOV SPOT RGP & ALKY VALUE ($/lb) Friday 1-Week Δ 1-Month Δ
*European and Asian prices and commentaries are courtesy of Tecnon
EUROPE*
No spot trades were confirmed this week, but PGP pricing was notionally pegged at a 5% discount to the Nov contract (equivalent to €1002/mt or $1137/mt). Dec material w as put at 2% below contract. Nov contracts w ere previously settled dow n €10/mt at €1060/mt. Naphtha prices fell to $535/mt, dow n
from $572/mt last w eek.
Dow nstream, Nov PP prices were falling, but new transaction levels w ere not yet confirmed. Spot PP ended the w eek f lat on a Euro basis at €1325/mt ($1504/mt or 68.2 cpp) FD NWE and CoPP w as at €1365/mt ($1549/mt or 70.3 cpp) FD NWE.
In operations news, cracker operating rates were still constrained by low Rhine water levels, which dropped back to 38 cm at the pinch point in Kaub, Germany, dow n from 60 cm last w eek. Naphthachem-
ie’s 740,000 mt/yr cracker at Lavera, France began a 6-8 w eek scheduled outage in Sep; it w as not clear whether the cracker has restarted. LyondellBasell ’s G6 cracker in Wesseling, Germany shut for planned maintenance in late Aug and is in the process of restarting. The Bayeroil refinery in Vohburg, Germany remains dow n follow ing an explosion and f ire in Sep. It is not expected back online until 2Q 2019. The site
has a propylene capacity of 60,000 -70,000 mt/yr.
ASIA*
East Asia spot propylene prices were down slightly this w eek. The FOB Korea market fell $35/mt to $1020/mt (46.3 cpp) and the CFR China market fell $5/mt to $1070/mt (48.5 cpp). China domestic propyl-ene spot prices fell Rmb100/mt to an average of Rmb8850/mt ($1274/mt or 57.8 cpp) ex -works. Inventory pressure w as low in East China, but demand w as sluggish due to w eak sentiment in the dow nstream PP,
PO, ACN, and oxo-alcohol segments. Upstream, naphtha prices w ere dow n $82.50/mt to $557.50/mt CFR Japan.
In the PP market, East China domestic spot HoPP raffia gained Rmb50-100/mt to $10350-10600/mt ex-warehouse. Branded prime HoPP raff ia w as fetching Rmb11400/mt. Southeast Asia HoPP raff ia import prices fell by $30/mt to $1255/mt (56.9 cpp) CFR amid w eak market sentiment.
In operations news, Shanghai Secco Petroleum’s cracker in Shanghai, China (propylene capacity: 600,000 mt/yr) has been shut s ince Oct 6 for a turnaround; restart is expected around Nov 26. Fujian Refining Petrochemical shut its naphtha cracker (propylene capacity: 670,000 mt/yr) for a turnaround in late Oct. Y NCC’s No. 3 naphtha cracker in Yeosu, Korea (propylene capacity: 230,000 mt/yr) has begun restart processes follow ing a turnaround. LG shut its naphtha cracker in Yeosu, Korea (propylene capaci-
ty: 770,000 mt/yr) for maintenance on Oct 28. Restart is scheduled for Nov 30.
