20 September 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--Propane prices fell $50/tonne (€37/tonne) for large cargoes and $65/tonne for cargoes less than 3,000 tonnes between 13-20 September, market sources said on Friday.
The anticipated arrival of large vessels from the US in late September and early October continues to undermine market sentiment. Demand for propane as heating fuel is unlikely to kick in for another week or two, buyers said.
One source said with LPG demand from central and Latin America tailing off, current freight economics meant US product loading from the Targa and Enterprise terminals would be Europe-bound in the short term before heading toward Asian markets in November and December.
The naphtha-propane spread lengthened to -$180, at which difference petrochemical firms were cracking propane as much as possible. “Every cracker is cracking at the maximum,” said one feedstock trader.
Propane barge prices fell $20/tonne, though sources disagreed about supply levels in the Amsterdam-Rotterdam-Antwerp (ARA) area. One buyer said it was not difficult to acquire product at current prices, but another source said: “It’s true that large cargoes dropped, but from refineries or loading port it’s not really that cheap. Maintenance this week, so refineries don’t have much available.”
Butane cargo prices dropped $10/tonne for all cargoes. Sources said the large cargo market was thin and the coaster market even more so, with maintenance at a number of refineries and in the North Sea area limiting the amount of product available. The low price of propane cargoes meant there was little demand for butane as a feedstock.
“We are in a period where there’s maintenance in refineries and in the North Sea, so there’s a lot of product that’s being lost – not lost, but market is very thin,” said one source.
($1 = €0.74)
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