The initial settlement for US May contract prices for chemical-grade propylene and for polymer-grade propylene called for rollovers at 31 cents/lb and 32.5 cents/lb, respectively, sources said Friday.

The settlements, if accepted marketwide, would be below the latest nomination of a 0.5-cent/lb increase and would snap a streak of three back-to-back increases.

In market activity Friday, May was offered at 30.75 cents/lb Mont Belvieu-pipeline basis.

US polymer-grade propylene was assessed Friday at 30-30.5 cents/lb FD USG, steady day on day for both May and June deliveries.

The contract price is generally 2-3 cents above spot PGP prices 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. Refinery-grade product was steady Friday at 19.25-19.75 cents/lb delivered.

US propylene contracts are settled on a monthly basis between major producers and buyers.

The process includes price nominations by producers and subsequent negotiations with customers.

–Pavel Pavlov, pavel.pavlov@spglobal.com
–Edited by Lisa Miller, lisa.miller@spglobal.com

http://www.platts.com/latest-news/petrochemicals/houston/initial-may-us-propylene-cp-settlements-call-26443989