The Propylene market in the United States experienced a continued decline in prices during October 2024, followed by September. This downward trend was primarily driven by due to limited trading activity and subdued downstream demand which led to ample supply during this timeframe. Despite potential upward pressures from upstream factors, the overall market sentiment remained bearish due to the prevailing economic conditions and inventory levels.

Despite reduced operating rates at several Propylene plants, the market remained well-supplied due to abundant availability and strategic discounts offered by manufacturers to stimulate sales. This oversupply scenario was further exacerbated by the return of some production units to operation, leading to an increase in inventories across the domestic market which lowered the offered quotations. The downstream polypropylene market also witnessed a cooling effect, as several buyers in the region held sufficient inventories and showed no urgency to restock. This resulted in subdued trade discussions and dampened demand for Propylene. While there were expectations for a rebound in demand, economic headwinds and ongoing oversupply continued to weigh on the market to settle the prices at USD 950/MT, Propylene Polymer Grade DEL US Gulf, USA on 18th October 2024.

Moreover, inventories of Propylene built up due to poor demand in both domestic and export markets, overshadowing early signs of a potential seasonal recovery. This downward pressure further dampened sentiment in the Propylene sector, as market participants became increasingly pessimistic about the short-term outlook. While upstream factors such as crude oil prices and supply chain disruptions caused by hurricanes and port strikes could have potentially supported higher Propylene prices, their impact was offset by the weak downstream demand. The combination of limited activity, increasing market length, and falling spot prices contributed to a bearish market sentiment at the beginning of October. Despite supply loss due to the INVISTA, Houston in Texas due to trip having a capacity of 54833MT/yr, supply has not been affected in the USA was not affected. Moreover, due to the narrow margins and decline in demand from the downstream polypropylene sector, several firms were running the plant at reduced capacity to refrain the market from oversupply. Henceforth, despite the maintenance shutdown, the supply chain values have not been hampered as respective firms have resumed their units during this timeframe potentially adding supply length to the market.

As per ChemAnalyst, the Propylene prices in November are expected to rebound as downstream Polypropylene demand is foreseen to remain high. The start of the winter season might renew the new orders from the downstream polymer market.