AMERICAS: The week ahead in petrochemicals

US PROPYLENE: Prices for PGP and RGP stagnated the week ending June 11, a trend expected to continue as the summer months tend to see less market activity.

Ongoing maintenance on Dow's propane dehydrogenation unit and low inventories may contribute to more seasonal demand that usual, and keep prices in balance, even as trading activity remains thin.

US VINYLS: US spot export polyvinyl chloride prices were expected to remain rangebound the week of June 14 amid upstream chlor-alkali tightness. Westlake Chemical on June 9 announced its third force majeure on chlor-alkali products since mid-May on chlorine, hydrochloric acid and caustic soda produced at its 75,000 mt/year chlor-alkali unit in Longview, Washington, because a critical piece of electrical equipment failed. Market sources said that force majeure would likely affect US West Coast customers. US chlorine supply was seen tight overall amid strong demand for products made with it, including PVC, as well as higher water treatment demand. Public swimming pools and water parks that were shut in 2020 amid the coronavirus pandemic were open in regions with widespread COVID-19 vaccinations in 2021, increasing water treatment demand year over year. PVC supply remained tight, with two of three force majeures declared during a deep freeze in mid-February still in effect.

US AROMATICS: It remained unclear Monday whether US benzene prices would continue with a downward trend for the week of June 14. Prices fell 18 cents/gal the week of June 7 due to a global bearish sentiment. However, Asian prices were slightly stronger June 14 and US traders said the week started out with little immediate direction. S&P Global Platts Analytics is projecting global aromatics to remain weak to due to increased availability of materials following refinery restarts in the US and Europe.

US METHANOL & MTBE: Increased trading caused a price increase the week ending June 11, though without continued trading the price is not expected to stay at current levels. Traded values increased from 102 to 109 over a three day period, but with no corresponding increases to offer levels, which stayed consistent throughout the same period. As the market continues to anticipate the start up of the YCI Methanol One Facility, further price increases are not expected. In the US MTBE market, prices were poised to remain stable, with weaker prices having been seen during the week prior on healthy supply driven by favorable production margins. Export demand to Mexico could add some support to spot prices, if flows begin to increase on higher blending demand and favorable economics for MTBE versus other octane-boosting blending components.