CFR Far East

In the CFR Far East market last week, prices declined due to increasing supply. The Rim Asia Index was at $641.75/mt for propane and $625.75/mt for butane as of Jul 25, down $1.25/mt and $2.25/mt respectively from Jul 19. As the spread between propane and butane prices on the expected CP shrank, a decrease in butane prices was larger than that for propane. For propane cargoes, sellers having available cargoes for second-half August delivery appeared in the market and this led to the market down. One European trader bought a 23,000mt propane cargo at a premium of $6.5/mt to August CFR Far East quotations ($639.5/mt or a premium of $55.5/mt to the August CP as of Aug 25) last Thursday. For butane, demand from South Korea or Southeast Asia was seen while sellers for cargoes containing butane were hardly observed in the CFR Far East market.

FOB Middle East

The August CP was set at $590/mt for propane and $570/mt for butane, up $10/mt and $5/mt respectively from the previous month. The August CP for propane was higher than market forecasts as propane supply from Saudi Aramco was limited while demand from propane dehydrogenation (PHD) plants in China was firm. For September loading, not many buyers were looking for spot cargoes while some players taking term cargoes from the Middle East apparently considered reselling them in the spot market. Discussion levels for 44,000mt 50:50 cargoes were seen to be at a mid-single digit premium to the September CP.

Asia Pressurized Market

On an FOB South China basis, some sellers had room for spot sale. Offers for August loading were heard at a premium of $70/mt and above to the August CP. Buyers, however, were hesitant to purchase at this level. In Southeast Asia, supply was limited as active sellers were not seen. On the other hand, buying interest was also lackluster.