Spot LPG prices retreated slightly in South China this week due to rising supply, local traders said Friday.
Propane-rich imported LPG cargoes traded at around Yuan 6,700-6,750/mt ($1,090-1,098/mt) in the Pearl River Delta and around Yuan 6,750-6,800/mt in east Guangdong this week, both down about Yuan 50/mt from last week, said local traders.
Several major import terminals in the regions -- including Guangzhou Huakai, Chaozhou Ouhua, Shantou Siam Ocean Gas, Dongguan Jovo, Zhuhai New Ocean and Zhuhai Longhua -- received LPG imports last weekend, traders said.
The imports were estimated at 142,000 mt, sources said.
But the price drop was limited because many third-grade distributors entered the market to replenish stocks, local traders said.
"Many third-grade distributors had run out of inventories in the previous week when supply of imported cargoes was tight and kept their appetite for the new arrivals this week," said a trader with Zhuhai Longhua.
"This has helped buffer the LPG price drop to a certain extent, though supply of the grade was ample this week," the trader said.
Supply of domestically produced LPG in the South China market remained tight this week, which also underpinned LPG prices in the region, said another trader in the Delta.
He said a few arbitrage cargoes arrived in South China from PetroChina's Guangxi Qingzhou refinery, when they typically also come from PetroChina's Dalian refinery in northeastern China; Sinopec Qingdao, Zhenhai and Jinling refineries in eastern China; and Sinopec Hainan in southern China.
Sinopec Guangzhou refinery in the Pearl River Delta offered its domestically produced LPG cargoes at around Yuan 6,700/mt this week, up slightly by around Yuan 30/mt from last week.
E CHINA PRICES RISE ON TIGHT DOMESTIC SUPPLY
Meanwhile in East China, spot prices of both imported and domestically produced LPG rebounded slightly this week due to limited domestic supply, local traders said Friday.
Propane-rich imported LPG cargoes were said to be traded at around Yuan 6,500-6,550/mt in the Yangtze River Delta this week, up about Yuan 25/mt from around Yuan 6,500/mt seen last week, according to local traders.
"Supply of imported grade was stable in the market, but supply of domestic-grade was still limited this week," said a trader with Shanghai Golden Conti.
Sinopec's Zhenhai and Jinling refineries restarted from scheduled maintenance this week, but their LPG output has not resumed to normal levels, local traders said.
Sinopec's 13.5 million mt/year (270,000 b/d) Jinling refinery in Jiangsu province restarted three refining units late last week, and the 23 million mt/year Sinopec Zhenhai refinery in Zhejiang province expected to restart its 1.8 million mt/year No. 2 FCC unit last weekend after scheduled maintenance.
Domestically produced LPG was traded at around Yuan 6,450-6,500/mt in East China this week, up Yuan 100-150/mt from last week, traders said.
