Import CIF Prices of Liquefied Propane and Butane in China
08 September 2023
From 28th August to 3rd September, the comprehensive import CIF prices of liquefied propane and butane in China were 121.28 and 105.24 points, respectively.
On 6th,September,the China Liquefied Petroleum Gas (LPG) Comprehensive Import CIF Price Index released by the Global Trade Monitoring and Analysis Center of the General Administration of Customs and the Shanghai Petroleum and Natural Gas Trading Center showed that from August 28th to September 3rd, the China Liquefied Propane Comprehensive Import CIF Price Index was 121.28 points, a month on month increase of 10.16% and a year-on-year decrease of 9.55%; The comprehensive import CIF price index of liquefied butane in China was 105.24 points, a month on month increase of 6.38% and a year-on-year decrease of 25.4%.
In terms of international pricing benchmarks, according to data released by Saudi Aramco's CP in August 2023; The contract price (CP) of propane in August was 470 US dollars per ton, an increase of 70 US dollars compared to the previous month, a decrease of 11.11% month on month, and a decrease of 44.83% compared to the same period last year; The contract price (CP) of butane in August was 460 US dollars per ton, an increase of 85 US dollars per ton compared to the previous month, a decrease of 14.77% month on month, and a decrease of 48.28% compared to the same period last year; The significant reduction in Saudi Arabia's CP in August may affect the current domestic and international LPG market price levels.
In terms of international prices, there is a high positive correlation between the international price of LPG and the price of crude oil. From the perspective of crude oil prices, international oil prices rebounded this week, ending the past two consecutive weeks of decline, mainly boosted by the prospect of tightening oil supply. From a demand perspective, the Chinese government has recently introduced economic stimulus policies, and the slowdown in US economic growth has also dispelled market concerns about the Fed's interest rate hike in September. Positive macroeconomic factors have improved investors' expectations for oil demand. From a supply perspective, US crude oil inventories have fallen by more than 1 million barrels, hitting their lowest level since the beginning of this year. Moreover, Russian Deputy Prime Minister Novak stated that Russia has reached an agreement with OPEC+member countries to reduce oil exports in September, and the market generally expects Saudi Arabia to extend its voluntary production reduction plan of 1 million barrels per day until October, which will lead to a sustained tightening of global oil supply. As of last Friday, the settlement prices of the main contracts for WTI and Brent crude oil futures were $85.55 per barrel and $88.55 per barrel, respectively. The recent rebound trend of international oil prices may to some extent affect the price level of domestic and international LPG markets. Due to trade process reasons, the CIF price of LPG imports in China often lags behind the futures and spot prices in the international market for a period of time. The impact of recent fluctuations in LPG external prices will gradually become apparent in the later CIF price of LPG imports.
In the domestic market, supply has increased, demand has decreased, and the market trading atmosphere is flat. From a supply side perspective, last week, the actual arrival volume of imported LPG in China was 505000 tons, with the arrival cargo resources mainly in the Shandong region; The domestic gas production mainly comes from local refineries, and the domestic LPG production increased month on month during the week compared to the previous week; Overall, the total domestic LPG supply during the week increased compared to the previous week, leading to a relaxation of supply. From the perspective of demand side, the demand for civilian combustion is flat; Industrial demand has decreased, specifically in the field of chemical deep processing: in the field of propane deep processing, the operating rate of PDH devices has decreased, and the demand for propane chemical industry has decreased; In the field of butane deep processing, the MTBE operating rate has decreased, the alkylation operating rate has decreased, and the demand for butane chemical industry has decreased. Overall, the amount of resources arriving at the port last week met expectations; The domestic gas volume has increased compared to the previous week, and the overall market supply has increased compared to the previous week; The demand for civilian gas remains flat; Industrial demand has decreased, propane chemical demand has decreased, and butane chemical demand has decreased. Last week, the prices of various products in the domestic liquefied gas industry chain were affected by the downward trend of international crude oil, with both up and down present.
The compilation of China's comprehensive import CIF price index for LPG was jointly completed by the Global Trade Monitoring and Analysis Center of the General Administration of Customs and the Shanghai Oil and Gas Trading Center, Based on the first calendar week of 2019 (the comprehensive import CIF price of liquefied propane in China for that week was 3541 yuan/ton, with a price index of 100; the comprehensive import CIF price of liquefied butane in China for that week was 3535 yuan/ton, with a price index of 100), this comprehensively reflects the price level of LPG import CIF in China for the previous week. This is a beneficial exploration for China to establish its own benchmark price for LPG, which is conducive to improving market transparency, providing important reference basis for the marketization of LPG chemicals, facilitating timely and effective integration between the domestic and international markets, and further enhancing China's influence in the international LPG market.
On 6th,September,the China Liquefied Petroleum Gas (LPG) Comprehensive Import CIF Price Index released by the Global Trade Monitoring and Analysis Center of the General Administration of Customs and the Shanghai Petroleum and Natural Gas Trading Center showed that from August 28th to September 3rd, the China Liquefied Propane Comprehensive Import CIF Price Index was 121.28 points, a month on month increase of 10.16% and a year-on-year decrease of 9.55%; The comprehensive import CIF price index of liquefied butane in China was 105.24 points, a month on month increase of 6.38% and a year-on-year decrease of 25.4%.
In terms of international pricing benchmarks, according to data released by Saudi Aramco's CP in August 2023; The contract price (CP) of propane in August was 470 US dollars per ton, an increase of 70 US dollars compared to the previous month, a decrease of 11.11% month on month, and a decrease of 44.83% compared to the same period last year; The contract price (CP) of butane in August was 460 US dollars per ton, an increase of 85 US dollars per ton compared to the previous month, a decrease of 14.77% month on month, and a decrease of 48.28% compared to the same period last year; The significant reduction in Saudi Arabia's CP in August may affect the current domestic and international LPG market price levels.
In terms of international prices, there is a high positive correlation between the international price of LPG and the price of crude oil. From the perspective of crude oil prices, international oil prices rebounded this week, ending the past two consecutive weeks of decline, mainly boosted by the prospect of tightening oil supply. From a demand perspective, the Chinese government has recently introduced economic stimulus policies, and the slowdown in US economic growth has also dispelled market concerns about the Fed's interest rate hike in September. Positive macroeconomic factors have improved investors' expectations for oil demand. From a supply perspective, US crude oil inventories have fallen by more than 1 million barrels, hitting their lowest level since the beginning of this year. Moreover, Russian Deputy Prime Minister Novak stated that Russia has reached an agreement with OPEC+member countries to reduce oil exports in September, and the market generally expects Saudi Arabia to extend its voluntary production reduction plan of 1 million barrels per day until October, which will lead to a sustained tightening of global oil supply. As of last Friday, the settlement prices of the main contracts for WTI and Brent crude oil futures were $85.55 per barrel and $88.55 per barrel, respectively. The recent rebound trend of international oil prices may to some extent affect the price level of domestic and international LPG markets. Due to trade process reasons, the CIF price of LPG imports in China often lags behind the futures and spot prices in the international market for a period of time. The impact of recent fluctuations in LPG external prices will gradually become apparent in the later CIF price of LPG imports.
In the domestic market, supply has increased, demand has decreased, and the market trading atmosphere is flat. From a supply side perspective, last week, the actual arrival volume of imported LPG in China was 505000 tons, with the arrival cargo resources mainly in the Shandong region; The domestic gas production mainly comes from local refineries, and the domestic LPG production increased month on month during the week compared to the previous week; Overall, the total domestic LPG supply during the week increased compared to the previous week, leading to a relaxation of supply. From the perspective of demand side, the demand for civilian combustion is flat; Industrial demand has decreased, specifically in the field of chemical deep processing: in the field of propane deep processing, the operating rate of PDH devices has decreased, and the demand for propane chemical industry has decreased; In the field of butane deep processing, the MTBE operating rate has decreased, the alkylation operating rate has decreased, and the demand for butane chemical industry has decreased. Overall, the amount of resources arriving at the port last week met expectations; The domestic gas volume has increased compared to the previous week, and the overall market supply has increased compared to the previous week; The demand for civilian gas remains flat; Industrial demand has decreased, propane chemical demand has decreased, and butane chemical demand has decreased. Last week, the prices of various products in the domestic liquefied gas industry chain were affected by the downward trend of international crude oil, with both up and down present.
The compilation of China's comprehensive import CIF price index for LPG was jointly completed by the Global Trade Monitoring and Analysis Center of the General Administration of Customs and the Shanghai Oil and Gas Trading Center, Based on the first calendar week of 2019 (the comprehensive import CIF price of liquefied propane in China for that week was 3541 yuan/ton, with a price index of 100; the comprehensive import CIF price of liquefied butane in China for that week was 3535 yuan/ton, with a price index of 100), this comprehensively reflects the price level of LPG import CIF in China for the previous week. This is a beneficial exploration for China to establish its own benchmark price for LPG, which is conducive to improving market transparency, providing important reference basis for the marketization of LPG chemicals, facilitating timely and effective integration between the domestic and international markets, and further enhancing China's influence in the international LPG market.