The US Polypropylene (PP) market witnessed a little price movement prices moved higher by 0.4% as suppliers continued to possess variable amounts of inventories, accompanied with increasing interest from Mexican buyers. Export demand stayed strong as well, though competitive pricing out of the Middle East and Asia weighed on international prices, complicating offshore sales. For Polypropylene, preliminary data for August showed resin reactors improved to more than 90% for the first time since August 2021. Domestic PP sales were excellent and also the most since Aug 2021, though PP exports dropped nearly 14% from July 2024. Domestic PP inventories showed a meaningful 4.5% build bringing upstream stocks back up to the highest level since March of this year. This consequently resulted in spot PP prices moving somewhat higher. Nonetheless the US suppliers continued to have ample PP inventories in possession with most of them having built up stocks in advance. Reports of competitively priced PP cargoes originating from Asia were also heard which accordingly maintained price competition in the US market, keeping inventories largely stable. This week US PP market saw a bit less action this week as the industry’s growing expectations for a major impact to operations from Hurricane Francine were calmed when the storm guided east and away from Texas, the heart of US plastics production. Resin run rates in the Gulf Coast were slightly reduced as a precaution early in the week, corroborating to the slight increment in the prices of PP but Hurricane Francine instead hit Louisiana on Wednesday morning leaving 400,000 people without power and causing an estimated $1.5 billion in damages. However, the plastics industry seemed to skate by mostly unscathed, by the end of the week several resin producers confirmed little to no impact to their operations. This gave processors some relief as the threat of a major hurricane season, for which many stocked up with extra inventories of PP well in advance, had passed its official peak with relatively few issues to date.

Polypropylene (PP) trading remained tempered for another week with a combination of contributing factors paving the way. The lighter trading came amid minimal impact on production from Francine allowing processors to continue working off their larger on-hand resin supplies built the past few months. Propylene monomer costs also continued to fall as Propylene (Polymer Grade) production improved although some shutdowns being reported. Some examples include Chevron Phillips Chemical implementing a force majeure on its facilities at Old Ocean and Port Arthur and Shell Chemicals LP implementing a force majeure on its facility at Deer Park. These developments hover did not affect the flow of Propylene (Polymer Grade) or PP. Moreover, Propane prices decreased by 11%, according to EIA with propane ending stocks being at time high at 96, 817 at the week ending September 6, 2024, then 95,690 barrels at week ending August 30, 2024, according to EIA, which accordingly maintained a downward pressure on the production costs of PP. This further bolster the expectation that in the upcoming weeks the likelihood witnessing a fall in the September PP contracts for PP. This is even though INEOS and INVISTA continue to remain officially on Force majeure, despite having returned to production in late August 2024. Tightness for PP Copolymer however remains, however, buyers with patience slowed their purchases or reduced their volumes ahead of lower price expectations.