Platts: Global Petrochemical Prices Fell 3% in September

LONDON, Oct. 13, 2014 /PRNewswire/ -- Prices in the $3-trillion-plus global petrochemicals market continued to fall in September, following the drop in upstream energy prices, according to the just-released monthly Platts Global Petrochemical Index (PGPI). The PGPI is a benchmark basket of seven widely used petrochemicals and is published by Platts, a leading global energy, petrochemicals and metals information provider and a top source of benchmark price references.

The September PGPI was down $43, or 3%, from August to $1,384 per metric ton (/mt). On a year-over-year basis, petrochemical prices edged down less than 1% from September 2013.

"There were two factors contributing to lower prices in the petrochemical markets this past month," said Jim Foster, Platts editorial director of petrochemical analytics. "First, both crude oil and naphtha prices have been falling. This has reduced the cost of making petrochemical products. Second, the prices of petrochemical products have climbed too high for buyers, resulting in a fall in demand and slower sales."

Petrochemicals are used to make plastic, rubber, nylon and other consumer products and are utilized in manufacturing, construction, pharmaceuticals, aviation, electronics and nearly every commercial industry.

OLEFINS
Prices of olefins – a group of hydrocarbon compounds which are the building blocks to many petrochemical products used to produce everyday goods – were slightly lower in September. Both ethylene and propylene prices decreased by 1% month over month, mainly due to falling naphtha prices.

Polyethylene, a plastic manufactured from ethylene, saw prices decline 3% in September, while polypropylene prices were down 2% over the same period.

AROMATICS
Prices of aromatics – a group of scented hydrocarbons with benzene rings used to make a variety of petrochemicals – fell sharply in September, due to reduced downstream demand. Market sources said prices had moved too high and impacted the profitability of downstream products. As a result, benzene prices fell 9% in September, the largest drop of all components in the PGPI.

Paraxylene posted the second-largest fall – dropping 7% in September to $1,207/mt. Toluene prices were down  4% in September to $1,080/mt.

The price decreases in global petrochemical markets occurred amid a mixed performance by global equity markets in September. The Nikkei 225 climbed 5% during the month, while the Dow Jones Industrial Average fell less than 1% and the London Stock Exchange Index (FTSE) fell 3%. 

To access a summary of the September performance of each of the seven key petrochemicals included in the PGPI, visit this link: http://www.platts.com/newsfeature/2014/Petrochemicals/pgpi/index.

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.

Published daily in a real-time news service Platts Petrochemical Alert and other Platts publications, the PGPI is anchored by Platts' robust and long-established price assessment methodology and the firm's 100-year history of energy price reporting. 

Platts petrochemicals experts are available for media interviews. A sample list of experts may be found at the Platts Media Center. For more information on petrochemicals, visit the Platts website at www.platts.com.

About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals, metals and agriculture information and a premier source of benchmark prices for the physical and futures markets. Platts' news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency. Customers in more than 150 countries benefit from Platts' coverage of the biofuels, carbon emissions, coal, electricity, oil, natural gas, metals, nuclear power, petrochemical, shipping and sugar markets. A division of McGraw Hill Financial (NYSE: MHFI), Platts is based in London with more than 1000 employees in more than 15 offices worldwide. Additional information is available at www.platts.com.

About McGraw Hill Financial: McGraw Hill Financial, a financial intelligence company, is a leader in credit ratings, benchmarks and analytics for the global capital and commodity markets. Iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power and McGraw Hill Construction. The Company has approximately 18,000 employees in 30 countries. Additional information is available at www.mhfi.com.

SOURCE Platts

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