CFR Far East

The CFR Far East market surged last week due to robust buying interest for pure propane cargoes. Rim Asia Index was at $693.75 per metric ton (/mt) for propane and $673.75/mt for butane as of Jan 7, up $119.50/mt from Dec 25. Amid a cold wave, Japanese and Korean importers were said to have actively bought pure propane cargoes for the purpose of building their inventories up. It seemed that seven or above pure propane cargoes for first-half February delivery were traded. Meanwhile, LPG demand for petrochemical use was weak since LPG prices were higher than naphtha prices. In particular, butane demand for petrochemical use was sluggish and few buyers were seeking cargoes containing butane. As a result, the spread between propane and butane was likely to widen in the near future.

FOB Middle East

One Qatari producer issued a sell tender for a 44,000mt 50:50 cargo for late February loading. Nevertheless, some players such as Indian importers mainly buying even-split cargoes seemed to have already secured cargoes necessary for February loading. Thus, discussion levels for even-split cargoes for February loading remained at a premium in the $20's/mt to the February CP. Meanwhile, the expected February CP was revised up to $600/mt for propane and $580/mt for butane as the CFR Far East market soared and Saudi Arabia was expected to cut crude oil production.

Asia Pressurized Market

On FOB South China, sellers were not keen on spot sales due to smooth domestic sales in China. Only some sellers pondered selling at a premium in the $60's/mt to the CP. Meanwhile, talks seemed to be active for spot cargoes ex-Korean for delivery to China. One importer from South China bought four 2,500mt cargoes for second-half February loading from one Korean importer on a DES South China basis.

Sample Report