CFR Far East

In the CFR Far East market last week, propane prices weakened owing to increasing supply while butane prices gained due to perceptions of tight supply/demand. The Rim Asia Index was at $641.00/mt for propane as of Aug 15, down $0.50/mt from Aug 9 while that for butane advanced $9.50/mt to $641.00/mt. For propane, as the transit through the Panama Canal was smooth, the number of sellers having US-origin cargoes was increasing. On Aug 15, one South Korean importer sold a 23,000mt propane cargoes at a premium of $15/mt to September CFR Far East quotations (equivalent to $636/mt or a premium of $44/mt to the September CP as of that day) to a trader. Regarding butane cargoes, supply of even-split cargoes from the Middle East was seen to be tight while spot demand from Taiwan or Southeast Asia emerged and buying interest was heightening. Under such circumstances, some sources reckoned that in the CFR Far East market, propane and butane prices were at the same level.

FOB Middle East

The September CP was forecast at about $596/mt for propane and about $586/mt for butane. For September loading, there were few active sellers and spot supply was limited. A Qatari producer and a Middle East trader affiliated to an Abu Dhabi producer apparently had no room for spot sale. Far East importers were also not reselling their cargoes in the spot market. On the other hand, demand emerged from India. Indian Oil Corporation (IOC) and Hindustan Petroleum Corporation Limited (HPCL) conducted buy tenders but the tenders were apparently not awarded as offer levels were above the companies' expectations.

Asia Pressurized Market

On an FOB South China basis, more sellers considered exporting pressurized cargoes as domestic sales were sluggish. With availability increasing, the market came under downward pressure. As for demand, although some buyers were looking for spot cargoes, they lowered their buying ideas. Discussion levels were seen to be at a premium in the low $60's/mt to the CP. In Southeast Asia, a Malaysian petrochemical maker conducted a sell tender and apparently sold a cargo for Aug 12-14 loading.