CFR Far East

In the CFR Far East market last week, prices strengthened due to firm buying interest. The Rim Asia Index for propane and butane as of Nov 21 was at $631.25/mt and $626.25/mt, up $13.25/mt and $8.25/mt from Nov 15. Market sources believed that the spread between propane and butane prices in the expected December CP expanded from $5/mt to $10/mt and a rise in butane prices was limited. For second-half December delivery, not only traders but also Japanese players were actively looking for propane cargoes in the spot market. One Japanese importer seemed to have bought a 46,000mt propane cargo at a discount of $5.5/mt to December CFR Far East quotations (equivalent to $620.5/mt or a discount of $9.5/mt to the December CP). Nevertheless, one Chinese trader, one South Korean importer and one European trader had 46,000mt propane cargoes for this timing. A lot of potential sellers were seen and this weighed on the CFR Far East market.

FOB Middle East

The December CP was forecast at about $634/mt for propane and about $624/mt for butane. For December loading, Qatar Energy was said to have awarded its sell tender closed on Nov 20 for a 44,000mt 50:50 cargo loading Dec 19-22 at flat or a premium of $1/mt to the December CP. On the other hand, Saudi Aramco released its December loading acceptance and requested some players to change their cargoes from 44,000mt 50:50 to 44,000mt 25:75. Aramco was seen to have tight propane inventories.

Asia Pressurized Market

For South China loading, discussion levels for December declined to a premium of around $50/mt to the December CP on the mirror of significantly falling import costs along with slack supply/demand. For Southeast Asia, discharging operations had been delayed at ports in the Philippines due to typhoons but the disruptions became normal after this week started. Under the situation, buyers in the Philippines apparently could cover their demand by transporting domestic inventories. In Vietnam, domestic sales were lackluster and some players with high stocks were observed. Thus, there was no space in tanks and it apparently took time to discharge for three days at Haiphong port.