Many propylene traders and buyers were talking the expected decrease anywhere from 4-10 cents/lb or more, with some of the consensus that a 5-7 cents/lb drop for November is likely.
"We think the November PGP contract goes down 6-8 cents/lb," a major propylene trader said. "A November PGP contract at 57 cents/lb looks pretty solid, down 7."
One buyer active in the spot market was more conservative.
"My guess is [down] 4-6 cents/lb now," he said.
Nominations from major producers -- including ExxonMobil, LyondellBasell, CP Chem, Shell, and Enterprise Product Partners -- are expected this week. Not all major producers usually nominate, and some decline to do so when a decrease is expected.
The pronounced decrease for October resulted from weak demand in downstream markets, plentiful supply, and plummeting spot prices, sources said then.
Spot refinery-grade propylene has hovered below the 50-cent/lb mark for much of October, assessed at a 15-month low of 42.25 cents/lb on October 18, according to Platts data. The last time RGP was assessed that low was July 8, 2011 at 42 cents/lb.
Similarly, spot PGP and CGP have hovered below the 60-cent/lb mark for much of the month, also posting 15-month lows in the process. Spot PGP and CGP were assessed October 14 at 54 cents/lb and 51 cents/lb, respectively, their lowest values since July 23, 2010, when they were at 52.875 and 51.375 cents/lb, respectively.
Spot propylene prices have shown some strengthening over the past ten days, prompting some buyers and polypropylene market participants to revise their forecasts for November.
"We started at down 8-10 [cents/lb for the propylene contract]," a PP distributor said. "We revised to down 6-8 [cents/lb] and now we are at down 4-6."