CFR Far East

The CFR Far East market fell last week due to weak crude prices. The Rim Asia Index dropped to $455.50/mt for propane and $485.50/mt for butane as of Oct 24, down $17.50/mt from Oct 18. The CFR China market considerably fell on account of slack supply/demand. Several Chinese importers pondered reselling in the spot market while active buyers were not seen in the market. As a result, discussion levels for second-half November delivery to East China dropped to a premium in the high $50's/mt through the low $60's/mt to the November CP. In the CFR Japan market, while some traders moved to cover their short-positions for second-half November delivery, Japanese and Korean importers seemed to have already met their demand for this timing. For first-half December delivery, although Japanese and Korean importers were expected to have room to buy due to the peak demand winter season, supply of pure propane cargoes ex-US was likely to increase going forward. In fact, one Japanese importer had already received selling interest from two or three sellers.

FOB Middle East

The November CP was expected to be at $410-415/mt for propane and $430-435/mt for butane as of Oct 24. The market fell due to slack supply/demand. QPSPP issued an FOB tender to sell a Dec 1-28 loading 45,000mt propane cargo. The tender was scheduled to close next Monday at 12:00 and its expiration was set on the next day at 17:00 both local Doha hours. QPSPP could accept offers on a CFR basis as well. Further, two European traders seemed to be interested in selling 44,000mt 50:50 cargoes for November loading. On the demand side, buying interest from India became sluggish. Bharat Petroleum Co (BPCL) canceled its buy tender that had closed on Oct 18. Through the tender, BPCL was looking for a November loading 44,000mt 50:50 cargo. BPCL was believed to have secured the volumes equivalent to those sought in the tender by adjusting the shipping schedules without having bought via the tender. Only one European trader placed a bid for a second-half November loading 44,000mt 75:25 propane-rich cargo at a discount of $10/mt to the November CP. Under this situation, discussion levels for November loading declined to a discount of $3-6/mt to the November CP.

Asia Pressurized Market

In the FOB South China market, discussion levels for November loading dropped to a premium of $58-63/mt to the November CP due to decreasing procurement costs of refrigerated cargoes. For the CFR Vietnam market, no buyers were interested in spot purchase for November delivery while there were views that deals might be possible at a premium of $90-95/mt to the November CP.

Sample Report