Global petrochemical prices up 10% in April from March

In the first double-digit increase since February 2012, prices in the $3-trillion-plus global petrochemicals market climbed 10 per cent month over month in April.

This marked the first time since 2013 that global petrochemical prices have climbed for three consecutive months. Petrochemical prices, expressed as a monthly average, increased $97 per metric ton (/mt) from March to $1,052/mt in April, 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 provider of energy, petrochemicals, metals and agriculture information and a top source of benchmark price references.

''Petrochemical prices were reacting to increasing crude and naphtha prices,'' said Jim Foster, director of petrochemical analysis at Platts. ''Naphtha, which is the most commonly used feedstock to produce olefins, climbed 13 per cent in April as crude was up about 16 per cent. As those feedstock prices climb, petrochemicals tend to trend higher.The tightness in supply due to maintenance turnarounds in the global ethylene markets also contributed to the strong gains.''

Platts Global Petrochemical Index ($ / Mt)

The chart above shows the daily end-of-day Platts Global Petrochemical Index (PGPI) price in red and also displays the 20-day PGPI moving average (MA) in blue. If you have trouble viewing the graphic, visit this link:PGPI Averages.

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 of many petrochemical products used to produce everyday goods – were mixed in April.

Ethylene prices jumped 19 per cent to $1,096/mt. Maintenance turnarounds caused tight supply in the global ethylene markets, pushing the price higher. Propylene, though, saw prices fall 2 per cent in April as strong refinery production rates pushed more propylene into the market.

Polyethylene and polypropylene, plastics manufactured from ethylene and propylene respectively, were both stronger in April. Global polyethylene prices climbed 12 per cent to $1,422/mt, while global polypropylene prices increased 7 per cent to $1,368/mt.

Aromatics
Prices of aromatics – a group of scented hydrocarbons with benzene rings used to make a variety of petrochemicals – also was also on an uptrend in April. Benzene saw the largest increase of any aromatic component in the PGPI, with prices climbing 14 per cent from March to $831/mt in April. Toluene prices rose 6 per cent to $730/mt, while paraxylene prices were up 9 per cent at $859/mt.

Global equity markets were higher in April. The London Stock Exchange Index (FTSE) posted a 3 per cent gain, while the Nikkei 225 was up 2 per cent last month. The Dow Jones Industrial Average climbed 1 per cent in April.