In a surprise move, ExxonMobil Chemical Co. has announced that it will reduce U.S. polypropylene resin prices by as much as 5 cents per pound in June.
The move will take place regardless of any price change for propylene feedstock, market sources said. Officials with Houston-based ExxonMobil could not be reached for comment.
Prices for the firm's random and impact copolymer PP grades, as well as homopolymer PP used in thermoforming and metallocene homopolymer — will be reduced by 3 cents per pound, sources said. All other grades of homopolymer PP made by ExxonMobil will be reduced by 5 cents per pound.
The announcement comes with market watchers expecting regional PP prices to be flat in May after falling an average of 3 cents per pound in April. Demand for the material has been solid, but market prices are being impacted by a surge in availability of imported PP.
Regional PP supplies are constrained as a result of large amounts of capacity being shut down during the recession. That combined with increased demand means that operating rates for PP production in the region are in the high 90s.
Sources have told Plastics News that South Korea, Brazil, Saudi Arabia, Colombia, Thailand and Singapore have been active in importing PP into North America.