Asian Propylene Prices Stabilize as Supply Constraints Offset Weak Trading

Asian propylene prices remained unchanged across Northeast Asia (NEA) and Southeast Asia (SEA) during the week ending October 9, as China’s National Day holiday significantly reduced regional spot market activity. Despite subdued downstream demand, restricted supply continued to support prices and prevent further declines.

Volatility in crude oil and propane markets also influenced sentiment. Although Brent futures faced pressure early in the week, renewed geopolitical tensions in the Middle East revived supply concerns and triggered a recovery. With Chinese buyers and traders largely absent, market participants had limited fresh indications to assess the strength of underlying demand.

Naphtha prices recovered to $936/ton CFR Japan on Wednesday, reducing their decline from two weeks earlier to around 3%. Propane prices also strengthened, rising from $903/ton CFR Japan on Monday to $932/ton by midweek.

Propylene Price Overview

CFR China

Latest Price: $1,210/ton
Weekly Change: Unchanged
Bid Range: $1,180–1,190/ton
Offer Range: $1,260–1,300/ton

CFR Southeast Asia

Latest Price: $1,230/ton
Weekly Change: Unchanged
Bid Range: $1,190–1,220/ton
Offer Range: $1,280–1,300/ton

Northeast Asia Stabilizes After Two Weeks of Declines

Propylene prices in Northeast Asia stopped falling after two consecutive weeks of modest losses. The recovery in crude and propane costs, combined with persistent supply limitations, helped stabilize the market. Despite the recent correction, prices remained approximately 16% above early-August levels.

Trading activity was limited as Chinese participants remained away for the holiday. Indicative offers stood at $1,260–1,300/ton CFR Northeast Asia and China, while buying ideas remained below $1,200/ton.

For formula-based cargoes, bids were reported at discounts of $40–50/ton to CFR Northeast Asia assessments on an FOB South Korea basis, while CFR Northeast Asia bids carried premiums of $10–15/ton. These discussions concerned October loading or delivery.

No new tenders were reported from Taiwanese or South Korean producers during the week. The latest known tender was conducted by Taiwan’s Formosa Petrochemical, which sold approximately 20,000 tons of propylene for October loading to four trading companies under floating-price formulas linked to CFR Northeast Asia assessments. A Japanese-origin cargo had also previously been reported sold at $1,200/ton CFR South China for arrival in mid-October.

China’s domestic propylene market moved in the opposite direction to the quiet import segment. Prices in Shandong and East China increased by CNY200–300/ton to CNY9,700–9,900/ton, supported by lower inventories and short-covering by traders. Sinopec also raised its propylene price by CNY300/ton to CNY9,900/ton.

However, the holiday-related absence of market participants kept import trading subdued, limiting the availability of fresh price indications.

Chinese PDH Shutdowns Tighten Supply

China’s propane dehydrogenation (PDH) operating rate reportedly declined to around 65%, compared with approximately 71% a week earlier, as additional maintenance shutdowns reduced production.

Fujian Soft Packaging shut its 900,000 tons/year No. 2 PDH unit in early October, with no confirmed restart date. Grand Pacific Chemical’s 600,000 tons/year unit and Hebei Haiwei’s 500,000 tons/year plant also remained offline following shutdowns in late September.

Supply is expected to remain restricted through October and much of the fourth quarter. In South Korea, LG Chem plans to shut its 1.3 million tons/year cracker in mid-October for approximately 45 days. KPIC is also preparing for a turnaround lasting around 40 days at its 800,000 tons/year cracker, which has been operating at approximately 65% capacity.

Japanese propylene availability remains constrained as well, reflecting reduced operating rates and maintenance at residual fluid catalytic cracking (RFCC) units.

Southeast Asia Maintains Previous Gains

Propylene prices in Southeast Asia held steady, retaining the $20/ton increase recorded the previous week. Trading remained limited, with the $1,250/ton CFR Thailand transaction reported last week continuing to serve as a reference point.

However, market participants noted that the cargo had been purchased to meet a specific consumer contract rather than indicating a broader improvement in demand. With Chinese traders and end-users absent, regional participants largely waited for the holiday to end before reassessing buying interest and selling offers.

Despite the quiet market, Southeast Asian propylene prices remained more than 18%, or approximately $180/ton, above early-August levels. Earlier increases in propane costs and continuing supply restrictions have supported prices and limited sellers’ willingness to reduce offers.

For floating-price cargoes, buying ideas were reported at premiums of $20–30/ton to CFR Southeast Asia assessments on a CFR Southeast Asia basis and discounts of $25–35/ton on an FOB Southeast Asia basis.

Reduced Operating Rates Restrict Regional Availability

Supply constraints across Southeast Asia continued to underpin the market as several crackers, PDH plants and RFCC units operated below normal levels.

Malaysia’s PRefChem reportedly shut its Pengerang refinery’s crude distillation unit again in late September because of technical problems, adding to concerns about feedstock availability.

PRefChem’s 1.29 million tons/year Pengerang cracker was reportedly operating at 60–70% capacity, while Aster Chemicals & Energy maintained operating rates of approximately 50–60% at its 1.15 million tons/year Pulau Bukom cracker.

PT Lotte Chemical Indonesia’s 1 million tons/year Cilegon cracker was running at around 50–55% amid feedstock constraints. Meanwhile, Rayong Olefins’ 900,000 tons/year Map Ta Phut cracker, which restarted in mid-September following an extended shutdown, was operating at approximately 80%. ExxonMobil’s older 900,000 tons/year Jurong cracker remained offline.

With supply constraints continuing across both Northeast and Southeast Asia, propylene prices are receiving support despite weak demand and limited spot activity. The return of Chinese participants is expected to provide a clearer picture of buying interest and whether current price levels can be sustained.

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