China LPG: Prices edge up amid refinery maintenance, delays in imported arrivals

日期:2014-09-20 10:10:57
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LPG prices edged up by around Yuan 20-50/mt ($3.25-8.13/mt) in South and East China this week amid lower supply due to refinery maintenance fewer arrivals of imported cargoes, domestic trade sources said Friday, September 19.

In East China, Sinopec’s 13 million mt/year (260,000 b/d) Gaoqiao refinery in Shanghai halted supplies to the local market earlier this week as the refinery shut all units for a full scheduled maintenance. This has reduced supply to the local market by more than 1,000 mt/day, traders said. Sinopec’s 9.5 million mt/year Yangzi refinery was still completing some maintenance work at its aromatics unit, said a source close to the refinery.

The refinery had, however, resumed normal operations, Sinopec said on its website earlier this week. Yangzi refinery in Jiangsu province had shut some of its refining and petrochemical units, including a 3.5 million mt/year crude distillation unit and a 1.2 million mt/year hydrocracker, for a scheduled maintenance starting from July 28, Platts has reported.

“Some work still needs to be done at a separation device of its aromatics unit, which has caused limited LPG production from the refinery and no supply of LPG to the market over the past two days,” the source said Friday.

Sinopec Yangzi has another aromatics unit which can produce LPG, but the output from that unit is consumed internally, the source noted.

“I heard that LNG supply is a bit tight recently, which forced the refinery to consume more of the LPG they produced,” he said.

LPG supply from Sinopec Yangzi is expected to resume to the normal level of around 1,000 mt/day next week.

As a result of the tighter supply this week, domestically produced LPG was heard traded at around Yuan 6,130-6,230/mt in East China Friday, up slightly by Yuan 30/mt from around Yuan 6,100-6,200/mt last Friday. Besides, import terminals in the region also raised price of imported LPG cargoes in line with higher domestic-grade prices, local traders said. Propane-rich imported LPG traded at Yuan 6,180-6,280/mt in East China Friday, also up around Yuan 30/mt further from Yuan 6,150-6,250/mt last week, they added. No imported arrivals were seen in East China this week, they said.

SOUTH CHINA LPG PRICE UP ON FEWER ARRIVALS THIS WEEK

LPG prices were also higher in South China amid fewer arrivals of imported cargoes this week, local traders said Friday.

Typhoon Kalmaegi, which made landfall in southern China’s Hainan Island Tuesday, brought strong wind and heavy rain to the southern coastal areas of China delaying some vessels that were scheduled to discharge their cargoes this week, market sources said.

“Zhuhai Longhua and Chaozhou Ouhua’s imported cargo arrivals were delayed due to Typhoon Kalmaegi and will now arrive next week,” a source said.

“Only Dongguan Jovo received a 22,000-mt imported cargo this week … Zhuhai New Ocean is also expecting a 22,000-mt imported cargo over the weekend,” the source noted.

In comparison, four imported cargoes totaling around 110,000 mt of LPG arrived last week, he added.

Zhuhai New Ocean which lowered its imported LPG offer price to around Yuan 5,800/mt earlier this week, raised it to above Yuan 5,900/mt Friday, said the source.

Other import terminals in the region were also selling cargoes at around Yuan 5,900-5,950/mt Friday, sources noted.

Propane-rich imported LPG traded at Yuan 5,900-5,950/mt in Guangdong province this week, rebounding Yuan 50/mt from Yuan 5,850-5,950/mt seen last week, said local traders.

Despite the slight uptick in prices, the import terminals in South China were still facing losses this week as import costs were higher than traded levels, said sources.

Import costs for September-delivery propane-rich cargoes are estimated to be around Yuan 6,000/mt, they said.

The market is not expected to improve next week either as additional supply is expected due to delays seen this week because of the typhoon, they added.

Domestically produced LPG traded at Yuan 5,820-5,930/mt in South China Friday, up Yuan 20-30/mt from last week, according to market sources.

Source: Platts

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