Weak Demand Affects Petrochemical Prices
Olefins prices were lower in March as downstream plastic demand ebbed and raw input costs dropped. The global propylene index in March fell 6% to an average price of US $ 1,331/mt, following a February level of US $ 1,411/mt. The price decline in propylene, which is used to produce polypropylene, also spurred a pull-back in the March global polypropylene price index, which slipped 3% to US $ 1,528/mt.
Ethylene, the second olefin component of the PGPI, saw a 4% price index retreat in March to US $ 1,349/mt, following the February average of US $ 1,403/mt. Polyethylene, which is produced from ethylene, saw a similar price decline last month. It was down 3% to US $ 1,538/mt.
Petrochemicals Market Defies Gobal Equity Price Trends
Petrochemical prices moved counter to price trends in the global equity markets in March. The Dow Jones Industrial Average (DJIA) was up 4% last month, while the London Stock Exchange Index (FTSE) edged up 1% and the Nikkei 225 jumped 7%.
Price Assessment of Seven Key Chemicals
The PGPI reflects a compilation of the daily price assessments of physical spot market ethylene, propylene, benzene, toluene, paraxylene, low-density polyethylene (LDPE) and polypropylene as published by Platts and is weighted by the three regions of Asia, Europe and the United States. Used as a price reference, a gauge of sector activity, and a measure of comparison for determining the profitability of selling a barrel of crude oil intact or refining it into products, the PGPI was first published by Platts in August 2007.