In Europe, spot propylene prices rose €10/ton over the past week, reported ChemOrbis, with market participants attributing the upward movement in prices to concerns that supply may tighten in the days ahead along with better-than-expected downstream demand. Although November and December are generally relatively slow months in the spot propylene market, one propylene producer commented that his company has revised its outlook on the spot market for December as it continues to see steady spot demand in spite of the season. Some sellers stated that they have even begun to limit their spot allocations as they feel that the market could become quite tight in December should there be any unexpected plant outages.

Although supply is still said to be generally sufficient in Europe, cracker operators have reduced their operating rates to around 85% of capacity in response to mounting naphtha costs, leaving the market more vulnerable to supply disruptions. Concerns over the possibility of further supply tightness were heightened towards the end of last week when PropanChem declared a force majeure at its 350,000-tons/year propane dehydrogenation unit in Spain.
 
Supply concerns also pushed spot propylene prices higher in the U.S. over the past week. Petrologistics declared a force majeure on the output of its new 544,000-tons/year propylene plant in Texas after the plant was shut down earlier this month due to technical problems. In addition, ChevronPhillips announced that it plans to conduct a two-week maintenance shutdown from the end of November to the beginning of December at its 417,000-tons/year propylene capacity cracker in Texas. Spot prices for polymer grade propylene rose $22/ton over the past week as a result of these supply issues, although players commented that there was not much activity in the spot market over the past week.
 
While spot propylene prices have moved higher in Europe and in the U.S., Asian markets witnessed lower spot propylene prices over the past week as lower upstream costs, along with news that the Chinese government is planning to enact further measures to restrain inflation within the country, resulted in weaker buying interest. Spot propylene prices on an FOB Korea basis lost $50/ton over the past week due to the drop in spot demand. Some players expressed concern that the spot market may face some oversupply issues in the days ahead as Japan's propylene production has been picking up recently even as propylene demand within the country has fallen off.