CFR Far East

In the CFR Far East market last week, propane prices went up due to strong crude oil prices while butane pries moved down owing to slack supply/demand. The Rim Asia Index was at $611.75/mt for propane as of Mar 7, up $11.75/mt from Mar 1. Meanwhile, that for butane was at $634.75/mt, down $5.75/mt. For propane, spot demand from traders appeared. Gunvor bought a 23,000mt propane at a premium of $13.5/mt to April CFR Far East quotations (equivalent to $609.5/mt or a premium of $6.5/mt to the April CP as of Mar 5) from BP. Regarding cargoes containing butane, supply was ample especially for cargoes of special origin while buying interest was weak. Sources reckoned that the price spread between butane and propane narrowed.

FOB Middle East

For April loading, availability was seen to be plentiful. Some players taking term cargoes from the Middle East apparently considered reselling them in the spot market. Further, a Middle East trader affiliated to an Abu Dhabi producer was believed to have room for spot sale. Thus, sources reckoned that discussion levels for 44,000mt 50:50 cargoes for April loading had fallen to a discount in the high $10's/mt to $20/mt to the April CP. Further, some sources pointed out that the butane/propane spread in the expected April CP should narrow to $5/mt since supply/demand of cargoes containing butane in the CFR Far East market appeared to be slack as well. Reflecting this, the April CP forecast was seen to be at around $605/mt for propane and around $610/mt for butane.

Asia Pressurized Market

On an FOB South China basis, buyers refrained from purchasing second-half March loading as the March CP had been set higher than market forecasts. For April loading, some buyers emerged looking for spot cargoes. As for supply, one seller had room for spot sale for April loading but showed no hurry to engage in talks. In Southeast Asia, few buyers and sellers were seen and activity was subdued.