Asia Propylene Prices Continue Lower as Supply Improves Across Region

Asian propylene markets extended their downward trend for a ninth straight week, although the pace of decline slowed compared with the sharp corrections seen earlier. Increasing supply availability across both Southeast Asia and Northeast Asia continued to pressure prices, while demand remained insufficient to absorb the additional volumes entering the market.

Unlike ethylene, which has experienced a much steeper correction in recent months, propylene prices have shown greater resilience. Market participants noted that the spread between the two products remains relatively wide, suggesting propylene still has some room for adjustment, though not at the same pace seen in ethylene.

Latest Propylene Market Levels

CFR China — $1100/ton
Down $60/ton from last week
Bid Ideas: $1080-1090/ton
Offer Levels: $1150-1200/ton

CFR Southeast Asia — $1120/ton
Down $60/ton from last week
Bid Ideas: $1090-1100/ton
Offer Levels: $1180-1250/ton

Southeast Asia Faces Rising Supply

The Southeast Asian market remained under pressure as additional production capacity gradually returned to operation. The restart of key facilities in Malaysia has increased expectations of higher regional availability during the second half of June.

Spot propylene values in Southeast Asia have now fallen roughly 25% from the highs recorded in early April. While sellers continue to lower offers, traders observed that the market is no longer declining as aggressively as it did earlier in the quarter.

Several fresh spot cargoes were offered into the market during the week, reflecting growing confidence among producers that supply conditions are improving. At the same time, buyers continued to bid cautiously, keeping negotiations difficult.

Further supply growth is expected in the coming weeks as additional crackers and refinery units across the region resume operations.

Ongoing Outages Provide Some Support

Despite increasing availability, several major shutdowns continue to limit the speed of the market correction.

Large crackers in Thailand remain offline, while an older Singapore cracker has been permanently shut down. These outages are helping offset part of the new supply entering the market and preventing a more dramatic collapse in prices.

Northeast Asia Sees Growing Inventories

In Northeast Asia and China, propylene prices also moved lower as inventories increased and domestic production expanded.

Chinese PDH operating rates continued to improve, reaching their highest level in several months following the restart of multiple production units. The return of these facilities has added substantial volumes to the domestic market.

Local producers responded by lowering prices to stimulate sales. Spot values across East China and Shandong weakened further as sellers attempted to move inventory amid cautious downstream demand.

Import cargoes from South Korea and Japan also faced pressure, with buyers submitting increasingly lower bids while suppliers adjusted offers to remain competitive.

Demand Remains a Key Concern

Although supply growth remains the primary driver behind the recent declines, weak downstream demand continues to limit market recovery.

Many buyers are purchasing only according to immediate production requirements and remain reluctant to build inventories. This cautious approach has reduced trading activity and kept pressure on sellers throughout the region.

Outlook

The propylene market is expected to remain under pressure in the near term as additional regional production returns to operation. However, with several large facilities still offline and the pace of decline already slowing, market participants believe future corrections may be more gradual than those seen over the past two months.

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