OREANDA-NEWS.  December 04, 2014. The prices of both imported and domestically produced LPG fell back in East China this week after rebounding last week due to ample imports at lower prices, sources said.

Propane-rich imported LPG traded at around Yuan 5,050-5,150/mt (USD822.52-838.80/mt) in East China this week, down by Yuan 225 from last week, sources said.

Local major LPG import terminals — Oriental Energy and China Gas — have been expecting three imported refrigerated cargoes, totaling around 112,000 mt since last weekend, according to data from Beijing-based energy information provider JYD Commodities Hub.

“Oriental Energy would have received two full cargoes of 44,000 mt each, this week, while China Gas would have received one cargo of 24,000 mt this week,” an analyst with JYD said.

In comparison, there were few imports last week, the analyst said.

“Both Oriental Energy and China Gas cut their spot prices for imported LPG this week in a bid to sell as much as they can because the import costs for later arrivals will be lower,” a local trader said.

The import costs for second-half November arrivals were estimated to be around Yuan 4,900/mt, traders said.

Meanwhile, the cost of refrigerated cargoes to be delivered in the second half of December were estimated to be around Yuan 4,500/mt CFR China based on Platts assessments, much lower than spot imported LPG prices.

“We are keeping our LPG inventories relatively low on fears that prices might fall further in the near future,” a second local trader said.

Domestic LPG traded at around Yuan 4,950-5,050/mt in East China this week, down by around Yuan 170, sources said.

“The sales performance of domestically produced LPG was poor due to weak demand from petrochemical plants and competition from imported LPG,” a third local trader said.

“Many petrochemical plants were said to be maintaining low run rates or even halting operations due to the eight consecutive drops in oil-product prices in China in the past few months, which are in line with lower crude prices,” the trader said.

“It’s not known when the crude prices will stop falling,” he added.

Petrochemical plants use LPG as a feed stock for MTBE and alkylate, which are blended to produce gasoline.