CFR Far East

In the CFR Far East market last week, propane prices strengthened on firm demand while butane prices declined since the spread between propane and butane in the November CP was set at $15/mt and the spread in the December CP was expected to widen. As of Oct 30, the Japan Index for propane and butane gained by $23.50/mt and $8.50/mt from the previous week to $516.50/mt for propane and $537.50/mt for butane. In Japan, traders were actively trying to buy propane cargoes for December delivery. Nevertheless, some sellers considered shifting their sales from November delivery to first-half December delivery and available cargoes were seen to be enough. The China Index for propane moved up by $13.00/mt from the previous week to $553.50/mt while that for butane fell by $2.00/mt to $536.50/mt. A summit meeting between the leaders of the US and China was held on Oct 30, and they agreed to extend the suspension of additional tariffs, which had been set to expire on Nov 10, for one year.

FOB Middle East

For discussions for 44,000mt 50:50 cargoes for November loading from the Middle East, wait-and-see mood was strong just before the release of the November CP. Saudi Aramco set the November CP at $475/mt for propane and $460/mt for butane on Oct 30, down by $20/mt and $15/mt respectively from the October CP. As for propane, many sources viewed that the November CP was higher than market expectations. In addition, as butane prices from the US were relatively high, supply/demand of cargoes containing butane for delivery to the Far East was perceived to be tight. Because of this, the spread between propane and butane prices was expected to be erased. However, the spread shrank only to $15/mt from the previous month in the end.

Asia Pressurized Market

For South China loading, buyers and sellers for November loading were seen in the market. Offers were reported at a premium of $60/mt to the CP while buyers showed bids at a premium in the low $50's/mt to the CP. In Southeast Asia, one US Major was said to have bought a cargo for Singapore delivery for end-October through early November delivery to Sintapore, but the price was unclear. Meanwhile, Vietnamese major supplier was considering buying spot cargoes in the pressurized market since supply of refrigerated cargoes containing butane was tight.