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 forecast at about $587/mt for propane and about $577/mt for butane. For August loading, a European trader was looking for a 44,000-45,000mt 50:50 cargo while another European trader was interested to buy a 46,000mt propane cargo. On the other hand, talks were slow to progress and no deals were reported. For September loading, most players were waiting for results of a buy tender conducted by India's Bharat Petroleum Corporation Limited (BPCL) for up to two 44,000mt 50:50 cargoes for September loading. Several sellers seemed to have taken part in the tender. Some sources reckoned that discussion levels for 44,000mt 50:50 cargoes for September loading were at a mid-single digit premium to the September CP.

Asia Pressurized Market

On an FOB South China basis, owing to sluggish sales in the domestic market, more sellers moved to sell pressurized cargoes and the market moved down. On the other hand, some buyers were looking for spot cargoes for August loading. Discussions for August loading were apparently conducted at a premium in the high $60's/mt to the August CP. In Southeast Asia, demand on a CFR basis for August delivery was observed from the Philippines.