ExxonMobil's Singapore Plant to Shut Down Again! Would You Like to Raise The PP Contract Price in May?

On April 4, Exxon Mobil said in an official statement to customers that due to unforeseen external market factors that seriously affected the company's business, Exxon Mobil planned to close some of its Singapore plant's production capacity in April.

The company did not specify the units affected by the shutdown, but assured buyers of a steady supply of performance polyethylene (metallocene grade). Therefore, it is currently certain that the 650,000-ton/year metallocene PE (mPE) plant will continue to operate throughout April.

But at the same time, the old units including the 480,000-ton/year PP production line and the 600,000-ton/year LLDPE unit may be affected, and the 650,000-ton/year new LLDPE production line may also be affected.

On the other hand, according to theplasticsexchange report, Exxon Mobil began to raise the contract price of PP (polypropylene) in May. The company said in a letter to customers on Monday (April 4) that it will start from May 1 Raise ExxonMobil PP prices by at least $0.06/lb for all grades. The company said that this was due to strong demand from downstream processors and traders, but the frequent occurrence of force majeure in the country led to a tight supply of raw materials, and ExxonMobil decided to raise PP prices to expand corporate profit margins. The company also added that the price hike has nothing to do with price changes in upstream propylene feedstocks.

In fact, ExxonMobil was the first producer to announce a price increase for the May PP contract. A few days ago, LyondellBasell raised the April PP price by $0.04/lb.

The March PP contract has settled in a $0.10/lb increase, following the March PGP contract up the same level, which brings the PGP up to $0.72/lb.

The April and May price moves came as North American PP production and supply took a major hit last week after two force majeure declarations, one at LyondellBasell's plant in Lake Charles, Louisiana, and another at LyondellBasell's facility in Lake Charles, Louisiana. One was from Ineos Olefins & Polymers due to a power outage and manufacturing failure at its plant in Carson, California.

Current PP homopolymer and copolymer prices at $1.02/lb and $1.12/lb, respectively, have risen by $0.02/lb last week and are in line with this season's highs set in early March. Meanwhile, raw PGP spot levels also rose on Monday, with several transactions confirmed in April at $0.73/lb, up from last week's high of $0.68/lb.