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Weekly SummaryInternational/Markets

LPG: May 25-29: Receding buying interest sends prices lower

CFR Far East

The CFR Far East market fell last week due to retreating buying interest. Rim Asia Index for propane and butane as of May 28 was at $322.75 per metric tons (/mt) and $307.75/mt respectively, down $9.00/mt from May 22. Several cargoes for second-half June delivery were traded. A 44,000mt 50:50 cargo ex-Nigeria and a 22,000mt 50:50 cargo were apparently sold on a CFR Japan basis. One pure propane cargo for delivery to East China seemed to be traded at a premium in the $20's/mt to the July CP. For first-half July delivery, one European trader sold a 44,000mt 50:50 cargo to one Japanese importer, according to sources.

 

FOB Middle East

Propane and butane prices for June loading were at a discount of $10-15/mt to the June CP. Some buyers felt that the prices were reasonable and were keen on spot purchase. One buyer bid for a 44,000mt 50:50 cargo for June loading at a discount of $15/mt to the June CP. In addition, one North Sea producer holding term supply commitments to India was looking for a 44,000mt 50:50 cargo for end-June to early July loading. On the supply side, One European Major had room to sell a 44,000mt 50:50 cargo for June loading but would enter discussions after the release of the June CP. Moreover, Chinese importers had high inventories and were likely to be interested in reselling in the spot market.

 

Asia Pressurized Market

For FOB South China, some refrigerated cargo importers could apparently sell at a premium in the high $30's/mt or above to the June CP. On the other hand, buyers were not interested in purchasing at this level. Although some traders pondered spot purchase, firm bids were not heard. On CFR Vietnam, one importer from Haiphong had no plans to buy spot cargoes due to weak domestic demand in Vietnam.

 

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