CFR Far East

In the CFR Far East market last week, prices softened in the wake of falling crude oil prices and strong selling interest. The Rim Asia Index for propane and butane as of Mar 6 was at $597.75/mt and $587.75/mt respectively, down $7.50/mt from Feb 28. Traders were trying to cover their short positions in the spot market and some operators of propane dehydrogenation (PDH) plants in China had spot demand. Meanwhile, market sources believed that supply was ample and this was cited as a bearish factor. The Ministry of Finance of China announced on Mar 4 that it would impose tariffs on US agricultural products. On the other hand, LPG would not be subject to the additional tariffs this time as well.

FOB Middle East

The April CP was forecast at about $585/mt for propane and about $575/mt for butane. For April loading, there were few active buyers. A cargo for April loading was traded at a discount of $17/mt to the April CP and this was seen to be the current market level. Sources reckoned that discussions could take place at a discount in the high $10's/mt to the April CP. Apart from this, there were also views that supply/demand for April loading was not as weak as that for March loading. Thus, market sources pointed out that a discount to the CP for April loading might not deepen compared to that for March loading.

Asia Pressurized Market

For Southeast Asia loading, Malaysian petrochemical maker Pengerang Refining and Petrochemical (PRefChem) closed a sell tender on Wednesday but results were as yet unclear. Offered in the tender were a total of six 2,500mt cargoes for loading from Pengerang during Mar 17-18, Mar 21-22, Mar 26-27, Mar 30-31, Apr 3-4 and Apr 7-8. After PRefChem carried out the sell tender, fresh talks were apparently not heard.