Asia propylene: SEA uptrend persists post-holiday, buoyed by firm NEA markets

Southeast Asian propylene prices continued their upward trajectory after the Lunar New Year holiday, supported by stronger Northeast Asian (NEA) markets and active arbitrage opportunities. Spot values remained firm as traders maximized shipments from Southeast Asia to higher-priced destinations such as China and Taiwan. Meanwhile, NEA propylene prices hovered near one-year highs, reinforcing bullish regional sentiment. The CFR Southeast Asia discount to China remained steady at $80/ton, as both markets moved higher in parallel.

Propylene Price Snapshot ($/ton)

CFR China: $830/ton, up $10; bids at $810–820, offers at $850–860

CFR Southeast Asia: $750/ton, up $10; bids at $720–730, offers at $770–780

Supply constraints and arbitrage sustain SEA price gains

Southeast Asian prices have risen by about $50/ton, or nearly 7%, over the past four weeks, driven by supply disruptions and strong arbitrage demand into Northeast Asia. The shutdown of an RFCC unit at Malaysia’s PRefChem complex in Pengerang has limited spot availability, with the facility’s 1.29 million tons/year cracker currently operating at around 50% capacity. Prior to the outage, several March cargoes had already been sold, and no new spot volumes were offered this week.

Firm NEA prices, currently assessed at $830–840/ton CFR China, continue to attract Southeast Asian cargoes. Market participants expect propylene prices to remain supported in the near term due to tighter supply conditions, despite some Chinese PDH units restarting after maintenance.

Upcoming restarts to partially ease supply pressure

Some additional supply is expected in early March as Aster Chemicals & Energy’s 1.1 million tons/year Bukom cracker in Singapore resumes operations following a fire-related shutdown, while Indonesia’s Chandra Asri cracker is also set to restart after a maintenance turnaround. However, ongoing outages and upcoming maintenance at Malaysia’s Petronas Kertih cracker from late March to mid-May will continue to limit overall supply growth.

NEA markets remain firm amid tightening availability

Northeast Asian propylene prices rose by $10/ton this week, supported by tight spot availability in China and steady downstream demand. Chinese domestic prices increased to CNY6,450–6,550/ton in Shandong, while Sinopec maintained its benchmark price at CNY6,500/ton. Rising operating rates at PDH plants, now averaging around 70%, have helped stabilize supply, although broader regional turnarounds are expected to tighten availability through the second quarter.

Taiwanese producer CPC sold March cargoes at slight premiums to prevailing CFR NEA levels, while reduced downstream demand and refinery restarts temporarily increased spot availability. However, planned cracker maintenance in Japan, South Korea, and Taiwan is expected to tighten regional supply further in the coming months.

Outlook remains firm on tight supply and regional arbitrage

Overall, the Asian propylene market remains on a firm footing, supported by supply constraints, strong arbitrage flows, and elevated Northeast Asian prices. While upcoming cracker restarts may offer limited relief, ongoing maintenance schedules and structural supply tightness are expected to keep prices supported through the second quarter.

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