sample copy of Argus International LPG

Argus International LPG
Daily international LPG prices and market commentary
Issue 14—111 | Friday 06 June 2014
OVERVIEW
PRICES
Cfr Far East freight rates continued to rise.
European prices were lifted by stronger crude and paper.
US prices were mixed at the week’s end.
Propane: Mt Belvieu non-LST diff to cif ARA
Key prices
$/t
±
$/t
200
100
Bid
Ask
±
Propane cif ARA (large cargoes)
+4
758 - 768
+5
Butane cif ARA (large cargoes)
+6
742 - 752
+7
daf Brest propane
685 - 702
daf Brest propane-butane mix
650 - 670
Propane Argus Far East Index™ (AFEI™)
895
+1.0
Butane Argus Far East Index™ (AFEI™)
892
+6.0
Argus Mixed Index
893.5
+3.5
¢/USG
Americas: Propane Mont Belvieu pipeline fob (Jun)
0
VWA
-100
±
Low
High
±
+0.500
+0.000
+3.969
-200
US propane del Japan (AUSJ) $/t
+4.0
780.0 -
781.5
+4.0
-300
US propane del ARA (AUSE) $/t
+4.0
690.0 -
691.5
+4.0
-400
04 Dec 13
101.086 +0.875
100.857 +0.750
+3.969
100.750 - 101.500
100.750 - 101.000
595.218 - 596.524
Non-LST
LST
USGC export fob $/t
International comparisons (Jun)
05 Feb 14
04 Apr 14
$/t
Propane
06 Jun 14
Butane
Argus North Sea Index™ (ANSI™)
755.5
713.0
Sonatrach fob Bethioua
755.0
730.0
Saudi Aramco
835.0
835.0
30
KPC (Kuwait)
835.0
835.0
Argus Middle East netback
792.0
789.0
20
Argus arbitrage
$/t
Propane: ARA diff to Med, cif
Propane
10
0
-10
NW Europe
AFEI
Physical spot
528.25
763.00
895.00
Jun
526.25
759.00
896.00
Jul
528.25
756.00
895.00
Aug
531.50
756.00
891.00
NWE diff to
Mt Bel
AFEI diff to
Mt Bel
AFEI diff to
NWE
-132.00
$/t
Regional assessments
Propane
-20
-30
06 Dec 13
$/t
Mt Belvieu
06 Feb 14
04 Apr 14
06 Jun 14
CONTENTS
Northwest Europe
Mediterranean, FSU
International swaps
Middle East
Asia-Pacific
US
Latin America
Industry news
Copyright © 2014 Argus Media Ltd
Physical spot
-234.75
-366.75
Jun
-232.75
-369.75
-137.00
Jul
-227.75
-366.75
-139.00
Aug
-224.50
-359.50
-135.00
Naphtha
2
3
3
4
4
7
9
9
±
Bid
Ask
±
+1.50
cif northwest Europe
+1.50
926.00 - 928.00
cif Mediterranean
+1.50
916.25 - 918.25
+1.50
cfr Japan
+11.00
939.50 - 947.00
+11.50
fob Mideast Gulf
+11.00
904.25 - 911.75
+11.50
LPG freight
$/t
VLGC Mideast Gulf-Japan 40,000-44,000t
103
1,800t Tees-Lisbon butane
105
1,800t Tees-ARA
45
Argus International LPG
Issue 14—111 | Friday 06 June 2014
NORTHWEST EUROPE
Northwest Europe and Mediterranean
$/t
±
Stronger crude helped lift paper values but the physical
market showed little sign of change. Rumours that the BW
Lord, currently loading at Enterprise in the US gulf, might
come to Europe, were uncorroborated but provided the
only real point of interest in an otherwise dull market. So
far the only confirmed US tonnes set to arrive in northwest
Europe from the US are due on Monday off the Clipper Sun.
Gunvor was back bidding again for 20-24 June arrival ToT
tonnes from 50:50 $758/t and balance June cif ARA -$6/t,
raised to $762/t on the fixed price and -$5/t on the floating
element. With balance June paper assessed at $759/t,
the bid was worth $758/t basis Flushing, now only a dollar
under paper, though still not tempting to any possible
sellers who remain aloof.
Thin supplies of large cargo butane are helping to lift
theoretical values. After recently falling to a seven-year
low of under 78pc of naphtha, buyers say that the prospect
of acquiring tonnes under 80pc is now extremely unlikely
with something in the low 80s pc increasingly probable.
However offers are scarce with no further information on
suggestions of Algerian tonnes heading north that circulated
on Thursday. With naphtha values moving higher the price
for butane firmed on both a relative and an outright basis.
Propane coaster prices tracked movements on the
large cargo market at the close of the week, as spot trade
remains in the doldrums. There were reports of a middle
of the month cargo becoming available next week from
northern France, but whether anyone will be there to pick
it up is uncertain with buyers currently thin on the ground.
But again the butane coaster market provided contrasting
vitality as petrochemicals continue to pick up tonnes, with
four confidential cif deals reportedly done. Two were for
higher quality butane while the other two were for product
high in olefins, ethane and sulphur at discounted levels.
Delivered prices relative naphtha were heard in the region of
the mid-70pc range up to the high 80pc marker, depending
on quality, volumes and loading times. This leaves the price
ratio to naphtha at 82-83pc, pulling the outright price down
a touch from yesterday despite naphtha’s small gain. There
were no discussions or deals heard on the fob side, with
Petredec not returning to offer a 4,000t cargo, the price
consequently drifting sideways.
Spot propane trading activity in the AmsterdamRotterdam-Antwerp area continued to drift with warm
weather and a holiday weekend sapping already sluggish
interest in LPG. With little change in either paper or large
cargo values and no substantive changes to local supply and
demand balances values moved sideways.
Copyright © 2014 Argus Media Ltd
Bid
Ask
±
768
+5
Propane
cif ARA (large cargoes)
+4
758 -
fob northwest Europe (small)
+5
668 -
678
+5
cif ARA (small)
+5
713 -
723
+5
670 -
680
690 -
700
755 -
765
fob Mediterranean (small)
790 -
800
fca Mediterranean (rail)
765 -
fob ARA (barge)
fca ARA (rail)
cif Mediterranean (large)
+5
Propane averages (Jun)
+5
775
Price
±
cif ARA (large cargo)
761.800
+0.300
fob ARA barge
676.429
Butane
cif ARA (large cargoes)
+6
fob northwest Europe (small)
cif ARA (small)
752
705
760 -
770
fob ARA (barge)
750 -
760
fca ARA (rail)
760 -
770
cif Mediterranean (large)
fob Mediterranean (small)
Butane averages (Jun)
-3
742 695 -
+5
750 -
760
785 -
795
+7
-3
+5
Price
±
cif ARA (large cargo)
740.100
+1.725
fob ARA barge
756.143
Crude
Argus North Sea Dated
Price
±
108.64
+0.26
Ice Brent futures settlement
Jul
108.61
-0.18
Aug
107.86
-0.25
Sep
107.16
-0.28
Indications that Shell may be running its Moerdijk
cracker at slightly lower rates did little to a slow spot
market. Small ship butane values appear to be picking up
and this is providing some support for the barge sector but
no fresh trading activity was reported.
Argus successfully completes Iosco assurance review
Argus has successfully completed an external assurance
review of its oil price benchmarks, including those for
LPG markets. The review was carried out by professional services firm PwC. An independent and external
review of oil benchmark prices is required on an annual
basis by international regulators in order to satisfy
Iosco’s Principles for Oil Price Reporting Agencies (the
PRA Principles). For more information and to download
the report visit our website
http://www.argusmedia.com/About-Argus/How-We-Work
Page 2 of 11
Argus International LPG
Issue 14—111 | Friday 06 June 2014
MEDITERRANEAN
FSU
$/t
±
Spot trade in the Mediterranean was limited at the end of
the week with discussion on propane and butane sparse.
Reports that BP had managed to offload their butane cargo
offered over the last few days from Lavera surfaced – but
the deal was unconfirmed. Prices on both propane and
butane reflected movements in northwest Europe, which
in turn were influenced more by crude and naphtha than
any notable market activity. There were no new reports
of Black Sea supplies shortening today, but even trimmed
output from the region would likely have a negligible
impact while buying is lacklustre.
FSU
Ask
fob Black Sea propane-butane mix
660 -
694
fob Black Sea propane
650 -
685
680
fob Black Sea butane
655 -
daf Brest propane-butane mix
650 -
670
daf Brest propane-butane mix €/t
477 -
492
daf Brest propane
685 -
702
daf Brest propane €/t
503 -
515
daf Brest differential to cif ARA (large)
daf Ukraine propane-butane mix
660 -
675
Argus RBS propane-butane mix index
640 -
-1
670
fot Burgas (Lukoil posted) propane-butane mix
809
+3
Argus Polish Domestic Index (APDI)
768
+1
International swap prices
Daf Brest assessments remained unchanged since they
correlate with buyers’ and sellers’ parity levels.
Prices in the Black Sea ports held steady while the
discussions were inside Thursday’s Argus value range.
±
-69.5
$/t
±
Bid
Ask
±
Propane northwest Europe
INTERNATIONAL SWAPS
Jun
+4
757 -
761
+4
Jul
+4
754 -
758
+4
Aug
+3
754 -
758
+3
Sep
+2
756 -
760
+2
Oct
+1
759 -
763
+1
763 -
767
755 -
759
763 -
767
-1
731 -
735
Jun
+3
922 -
924
+3
Jul
+4
911 -
913
+4
Aug
+2
900 -
902
+2
Nov
Paper trade was thin at the close of the week with some
early activity on July CP and later in the day for June cif
ARA the only notable exceptions. Values edged upwards
across the Asia-Pacific, Mideast and northwest European
markets, as well as on naphtha, to keep the propanenaphtha spread stable and help support slight gains on
east-west and AFEI-CP spreads.
A total of four June cif ARA deals were recorded during
the 16:15-16:30 assessment period, all of which were for
2,000t, at $761/t, $760/t, $758/t and $756/t, moving
lower through the 4.15-4.30pm timeframe. This pushed
the front month swap up $4/t to $759/t. But a slight
easing of the contango from July through to December
helped to level off any gains so that the later month swaps
were relatively unchanged.
Naphtha swaps also rose today, albeit more gently,
leaving the June propane-naphtha spread $1/t higher at
-$164/t. And the movements in later months were similar
to those seen on propane leaving spreads further along
the curve in similar positions to yesterday – finding the
narrowest point in January 2015 at -$105/t.
Mideast swaps rose slightly more robustly than their
Asia-Pacific brethren to push the AFEI-CP spread out to
$90/t in July – one dollar below a deal done earlier in the
day. Meanwhile the rises in Asia-Pacific pushed the eastwest spread out to $137/t in June and $139/t in July.
Copyright © 2014 Argus Media Ltd
Bid
3Q14
+3
4Q14
1Q15
+3
-1
Naphtha northwest Europe
Propane CP Middle East
Jul
+6
803 -
807
+6
Aug
+5
803 -
807
+5
Sep
+5
805 -
809
+5
Jun
+7
894 -
898
+7
Jul
+8
893 -
897
+8
Aug
+6
889 -
893
+6
Argus Far East Index™
$/t
Butane: AFEI diff to cif Med
250
200
150
100
50
0
-50
-100
-150
03 Dec 13
Page 3 of 11
04 Feb 14
02 Apr 14
06 Jun 14
Argus International LPG
Issue 14—111 | Friday 06 June 2014
Reported done ($/t)
Middle East and Asia-Pacific averages
$/t
Price
756 (2kt), 758 (2kt), 760 (2kt), 761 (2kt) Jun cif ARA
761 Jul cif ARA
757 Aug cif ARA
3 Jun-Jul cif ARA
802.5, 804, 805, 810 (x2) Jul CP
91 Jul AFEI-CP
86 Aug AFEI-CP
±
Middle East (Jun)
Propane
-10.526 -1.082
Butane
-10.263 -0.819
Argus Far East Index™ (Jun)
MIDDLE EAST
July paper swaps were valued at $803/t with a trade done
at that level before Asian timestamp amid a bid-offer range
of $800-$805/t.
The spot differential for June loading propane cargoes
in the Mideast Gulf were maintained at a $30/t discount
against the announced June CP of $835/t.
As a deal was seen at -$5/t for July propane/butane CP
paper swap, the spot differential for June loading butane
cargoes in the Mideast Gulf was assessed at a $25/t discount
against the June CP.
ASIA-PACIFIC
Propane
887.200 +1.950
Butane
885.000 +1.750
11+11 propane-butane mix (Jun)
886.100 +1.850
$/t
Propane: AFEI diff to Mt Belvieu
500
400
300
200
100
Refrigerated
0
04 Dec 13
Discussions on the Asia-Pacific refrigerated markets on
05 Feb 14
04 Apr 14
06 Jun 14
$/t
LPG arbitrage
Northwest Europe
Mt Bel differential to NWE
Physical spot
-234.75
Jun
-232.75
Jul
-227.75
Aug
-224.50
Physical spot
763.00
Jun
759.00
Jul
756.00
Aug
756.00
Mont Belvieu
Physical spot
528.25
Jun
526.25
Jul
528.25
Aug
531.50
Physical spot
-132.00
Jun
-137.00
Jul
-139.00
Aug
-135.00
AFEI
MT Bel differential to AFEI
Copyright © 2014 Argus Media Ltd
NWE differential to AFEI
Physical spot
-366.75
Jun
-369.75
Jul
-366.75
Aug
-359.50
Page 4 of 11
Physical spot
895.00
Jun
896.00
Jul
895.00
Aug
891.00
Argus International LPG
Issue 14—111 | Friday 06 June 2014
Friday were mainly focused across tenders that were placed
during the week.
Taiwan’s Formosa Plastic tender issued yesterday was
awarded at July cfr Japan naphtha minus low $50s/t for
a 11,000t+11,000t cargo due for arrival on any five days
between 6-15 July in Mailiao.
Taiwan’s CPC tender for a 22,000t+22,000t cargo due
for arrival over 6-15 July attracted ten offers and was
reportedly awarded at July cfr Japan naphtha minus low
$70s/t.
Meanwhile, the freight cost from Ras Tanura to Chiba
continued to soar above $100/t with a recent fixture done
at $105/t. On-going freight discussions for VLGCs were
heard to be in the range of $110-$115/t. With freight
cost returning to historical highs, buyers that had no
requirement for prompt cargoes preferred to wait out for
freight rates to correct downwards. On the other hand,
sellers remained hesitant of placing firm offers before
getting clearer directions in VLGC freight levels.
Overnight discussions remained thin for 22,000t propane
cargoes due for first-half July arrival. During the Asian
trading window session, an European and a US trader
resurfaced with their respective interest for second-half
July arrival 22,000t cargoes. The European trader posted
a bid for 22,000t propane due for arrival in second-half
July at July CP +$90/t, which equated to $893/t. The US
trader placed a corresponding offer at July FEI +$9/t, which
equated to $903/t or July CP +$100/t. No deals were seen
during the window session.
With the bid-offer range almost similar to yesterday’s
levels, cfr propane premiums for first-half July were
maintained at $92/t. As such, 22,000t propane cargoes
arriving over 1-16 July were assessed at $895/t or July CP
+$92/t basis Japan and south China.
The premium for 11,000t+11,000t cargoes were assessed
at $88/t, in line with a recent first-half July deal that was
done around that level. As such, 11,000t+11,000t cargoes
Asia-Pacific
Timing
Gulf CP fob
Jun
Jun
Japan CP cfr
Jun
1H Jul
Japan cfr
+1
+1
58 /
893
62
+1
- 897
+1
1H Jul
+1
58 /
62
+1
2H Jun
+1
58 /
62
+1
Jun
2H Jun
+1
East China cfr
+1
South China CP cfr
South China cfr
+1
893
- 897
58 /
893
Argus Far East Index™ (AFEI™)
62
- 897
895
+1
+1
+1
+1.0
Butane
Gulf CP fob
Jun
Jun
+5
Japan CP cfr
Jun
1H Jul
+6
Taiwan CP cfr
Jun
1H Jul
+6
East China CP cfr
Jun
2H Jun
Japan cfr
+6
East China cfr
+6
+6
South China CP cfr
Jun
2H Jun
South China cfr
+6
+6
West coast India CP cfr
Jun
Jun
+6
-30 / -20
55 /
890
59
- 894
+5
+6
+6
55 /
59
55 /
59
+6
- 894
+6
890
55 /
890
+6
59
+6
- 894
+6
50 /
Argus Far East Index™ (AFEI™)
54
892
+6
+6.0
11+11 propane-butane mix
Japan cfr
+3
891
- 896
South China cfr
+3
891
- 896
Argus Mixed Index
893.5
+4
+4
+3.5
Propane pressurised
South China CP fob
Jun
South China fob
South China CP cfr
Jun
South China cfr
Vietnam CP cfr
Jun
Jun
-10
Jun
-10
60
-10
885 / 895
50 /
-10
Jun
-10
90
-10
Jun
-10
915 / 925
-10
Jun
-10
105 / 115
-10
80 /
Butane pressurised
South China CP fob
Jun
South China fob
South China CP cfr
Jun
South China cfr
Jun
Jun
-10
Jun
-10
Jun
-10
Jun
Jun
-200
0
-250
-50
-300
-100
-350
-150
-400
-450
04 Dec 13
Page 5 of 11
05 Feb 14
60
-10
885 / 895
50 /
-10
90
-10
-10
915 / 925
-10
-10
105 / 115
-10
80 /
$/t
Butane: Mt Belvieu diff to cif ARA
50
Copyright © 2014 Argus Media Ltd
-35 / -25
Jun
-150
06 Jun 14
±
Jun
100
02 Apr 14
Ask
East China CP cfr
-100
04 Feb 14
Bid
Taiwan CP cfr
150
-200
03 Dec 13
±
Propane
Vietnam CP cfr
$/t
Propane: Saudi Aramco diff to AFEI
$/t
CP
basis
04 Apr 14
06 Jun 14
Argus International LPG
Issue 14—111 | Friday 06 June 2014
due for arrival over 1-16 July were assessed at $893.5/t
basis Japan and south China. PetroVietnam issued a buy
tender for 22,000t+22,000t cargo due for arrival over 20
June to July 10. The tender closes on 9 June.
Fresh demand for butane from Far Eastern
petrochemical crackers remained low as majority had
procured their requirements for July. 22,000t butane
cargoes due for arrival over 1-16 July basis Japan and south
China were assessed at $892/t, about $38/t lower than July
cfr Japan naphtha prices.
China wholesale propane/butane mix
yuan/t
±
Bid
Ask
±
East China
Ex terminal
Ningbo
6,200 - 6,250
Wenzhou
6,150 - 6,200
Taicang
6,200 - 6,250
Shanghai
6,300 - 6,400
Zhangjiagang
6,200 - 6,250
Fujian
6,500 - 6,600
Ex refinery
Pressurised
Shanghai
The surplus from recently imported cargoes during April and
May continued to cause south Chinese terminals to lower
their offer prices.
Fob south China offers were placed as low as $890/t or
June CP +$55/t. Traders were heard to be actively seeking
first-half June cargoes from south China and send them to
the Philippines, Bangladesh and Vietnam.
In Vietnam, selling ideas were around June CP +$110/t
cfr Haiphong amid pressurised freight costs of around $50/t
from south China to Haiphong.
Buying interest was dismal as traders viewed July CP to
be lower than the announced June CP of $835/t for both
propane and butane.
The Chinese domestic markets ended the week on a
steady note.
Ex-terminal prices in south China were steady at
6,100-6,600yuan/t for mixed cargoes, which equated to
$868-939/t on cfr basis.
No price changes were seen at Maoming and Guangzhou
after Wednesday’s price cuts due to limited buying interest
and moderate stockpiles.
Ex-terminal prices in east China were also left
unchanged at Yn6,150-6,600/t amid thin trading volumes.
Zhenhai
6,110 - 6,510
Yangzi
6,040 - 6,090
$/t
Japan: Butane diff to naphtha
5,890 - 5,990
Fujian
5,850 - 5,900
Gaoqiao
5,880 - 5,980
Qingdao
5,750 - 5,850
South China
Ex terminal
Zhuhai
6,150 - 6,200
Shenzhen
6,550 - 6,600
Raoping
6,100 - 6,150
Nansha
6,200 - 6,300
Shantou
6,100 - 6,150
Yangjiang
5,850 - 5,900
Ex refinery
Maoming
5,760 - 5,810
Guangzhou
5,950 - 6,000
Northeast China ex refinery
Daqing
6,070 - 6,170
Dalian
-200
6,300 - 6,400 -200
Northwest China ex refinery
Urumqi
4,900 - 5,000
Inland China ex refinery
Lanzhou
-100
Yan-An
5,350 - 5,400 -100
5,350 - 5,400
%
Propane LST ratio to Nymex WTI
80
250
200
70
150
100
60
50
50
0
-50
40
-100
-150
09 Dec 13
07 Feb 14
Copyright © 2014 Argus Media Ltd
07 Apr 14
06 Jun 14
30
09 Dec 13
Page 6 of 11
07 Feb 14
08 Apr 14
06 Jun 14
Argus International LPG
Issue 14—111 | Friday 06 June 2014
A 11,000t refrigerated cargo is expected to arrive in east
China on 11 June.
In north China, prices at Dalian dropped by Yn200/t to
Yn6,300-6,400/t in order to stimulate sales.
In inland China, prices at Lanzhou dropped by Yn100/t
to Yn5,350-5,400/t due to less demand from central China
and limited local demand.
Americas: Mont Belvieu pipeline fob (Jun)
VWA
¢/USG
100.857
+0.750 100.750 - 101.000 +0.000
101.625
+1.375 101.375 - 101.875 +1.375
Butane
119.500
-0.625 119.250 - 119.750 -0.625
101.086
+0.875 100.750 - 101.500 +0.500
Non-LST
Butane equivalent $/t
Ethane-propane mix
29.375 -0.250
29.000
+0.375
28.750 -
29.250 +0.375
-0.250 127.250 - 127.750 -0.750
Natural gasoline
213.068
212.500 - 214.000
USGC export fob $/t
+3.969 595.218 - 596.524 +3.969
US non-LST averages
¢/USG
Month to date
±
Propane (Jun)
102.088
-0.240
Butane (Jun)
123.425
-0.403
US forward market
¢/USG
±
Low
High
±
Mont Belvieu propane
Jun
+0.750 100.750 - 101.000 +0.000
Jul
+0.750 101.000 - 101.500 +0.750
Aug
+0.875 101.625 - 102.125 +0.875
Sep
+1.125 102.625 - 103.125 +1.125
3Q14
+1.000 101.750 - 102.250 +1.000
Mont Belvieu butane
Jun
-0.500 121.500 - 122.000 -0.500
Jul
-0.250 121.750 - 122.250 -0.250
Aug
-0.125 122.125 - 122.625 -0.125
Sep
+1.125 123.125 - 123.625 +1.125
3Q14
+0.875 122.375 - 122.875 +0.875
MtB: Nat gasoline non-Dynergy diff to butane non-LST
130
100
120
90
110
80
100
70
90
60
80
50
70
40
Copyright © 2014 Argus Media Ltd
28.750 -
-2.000 212.000 - 217.000 -2.000
127.500
120
06 Jun 14
-0.250
Isobutane
110
08 Apr 14
-0.375 121.250 - 122.375 -0.625
-1.698 549.263 - 554.359 -2.831
29.136
Purity ethane equivalent $/t
140
07 Feb 14
+4.570 526.217 - 530.135 +2.612
121.838
Purity ethane
150
60
09 Dec 13
±
Targa propane
Butane
Propane LST diff to ethane non-LST
High
Propane
Propane equivalent $/t
Mont Belvieu, Texas, NGL markets ended the week with
mixed sentiment. Trade interest was sparse after a lively
week that shocked market participants with an inventory
build that stood nearly 70pc above the expected build level
of 2.2mn bl.
Propane prices at the LST terminal were mostly rangebound and 37.5pt firmer day-over-day, while non-LST prices
jumped much more significantly by 62.5pt. Meanwhile
ethane prices moved to parity with E/P mix. The two
markets came together to stand flat at 29¢/USG.
Mont Belvieu heavy markets were also mixed. Butane
markets softened day-over-day in the midst of mixed outside
futures markets. Isobutane prices were down 50pt from
Thursday’s average level and trade remained muted for the
majority of the session. While natural gasoline prices spent
most of the day bouncing between the 213-214¢/USG range,
late session dealings in the afternoon window saw values
soften to the day’s low of 212.50¢/USG, bringing the average
price to parity with the prior day’s level. Natural gasoline’s
value relative to WTI crude softened 1pt to 87.25pc.
July WTI futures gained 18¢/bl as it settled the session
at $102.66/bl. The Nymex Rbob futures benchmark moved
in the opposite direction as it dropped to 293.90¢/USG,
or down 1.73¢/USG from Thursday’s close. Meanwhile the
Henry Hub natural gas July futures contract gained ever so
slightly by 70pt to settle at $4.679/mnBtu.
¢/USG
Low
LST
Propane
US
±
30
09 Dec 13
Page 7 of 11
07 Feb 14
08 Apr 14
¢/USG
06 Jun 14
Argus International LPG
Issue 14—111 | Friday 06 June 2014
LST propane opened the session priced at 100.875¢/
USG, and maintained that average price throughout the
session, reflecting a 37.5pt firming day-over-day. One
major rolled 500,000 bl of June LST propane to July to
collect 0.25¢/USG as the prior session’s flat forward curve
steepened to a 25pt contango. Outer month activity saw
fourth quarter barrels priced at 104¢/USG, while a 2015
January/February trade valued the forward month at a
62.5pt backwardation. Calendar 2015 propane was done at
102.625¢/USG.
At the non-LST propane hub, markets opened at parity
with LST but deviated as the day matured. Values climbed
to a high of 101.50¢/USG, but the session was capped
with a trade done at 101¢/USG. The prior session’s flat
relationship against LST prices diverged as non-LST propane
carried on average a 50pt premium to concurrent LST
materials. The June/July curve’s flat structure moved to a
0.50¢/USG contango.
At Hattiesburg, Mississippi, 5,000 bl of propane changed
hands at 101.375¢/USG.
As propane hubs separated, ethane values converged
with E/P mix prices. One lone outright E/P mix deal was
done at midday at 29.25¢/USG. Within moments purity
ethane was spread at flat to mix.
Ethane prices opened 12.5pt below Thursday’s midpoint
at 29.25¢/USG. Values softened to hit a low of 28.75¢/USG
before an afternoon boost. The market closed at its peak
of 29.375¢/USG. Meanwhile the prior day’s 12.5pt contango
steepened to 25pt.
Heavy NGL markets were mixed day-over-day, and
values felt downward pressure as the session progressed.
Natural gasoline markets ended the day flat to the previous
session’s average level.
Non-LST butane kicked off the session priced at
122.25¢/USG, or 12.5pt lower than Thursday’s midpoint.
AMERICAS DEALS
Mont Belvieu spot deals
Timing
¢/USG
75
70
65
60
45
09 Dec 13
29.250
10
E/P mix non-LST/non-LST ethane
Jun/Jun
0.000
10
Purity ethane non-LST
Copyright © 2014 Argus Media Ltd
06 Jun 14
121.625
10
Jun
121.750
10
Jun
121.750
25
Jun
122.000
10
Jun
122.250
10
Jun
122.375
10
10
Jun
28.875
10
Isobutane non-LST
Jun
28.875
10
Jun
Jun
29.000
10
Jun
29.000
10
Natural gasoline non-LST
Jun
29.250
10
Jun
212.500
25
Jun
29.250
10
Jun
212.625
10
25
127.500
10
Jun
29.375
10
Jun
212.625
Jun
29.375
30
Jun
213.000
10
3Q
29.500
15
Jun
213.000
10
Propane LST
Jun
213.000
25
Jun
213.125
10
Jun
100.750
10
Jun
213.250
10
Jun
100.750
25
Jun
213.250
10
Jun
100.875
10
Jun
213.500
10
Jun
100.875
10
Jun
213.750
10
Jun
100.875
10
Jun
213.875
10
Jun
100.875
10
Jun
214.000
10
Jun
100.875
10
Jul
212.500
10
Jun
100.875
75
Jun
101.000
10
Mont Belvieu natural gasoline Targa
4Q
104.000
75
Jun
Cal Year
102.625
84
217.750
10
Butane non-LST/non-LST butane
Propane non-LST
100.750
10
Jun
100.875
10
Jun
100.875
5
Jun
0.250
15
1Q
-4.250
150
Ethane non-LST/non-LST ethane
Jun
101.000
10
Jun
101.000
10
Jun
101.250
25
Propane LST/LST propane
Jun
101.500
10
Jan/Feb
-0.625
100
Jul
101.250
25
2Q/3Q
-1.000
30
0.500
10
Jun/Jul
0.250
500
0.000
Jun
Page 8 of 11
121.250
Jun/Jul
0.250
25
Targa/non-LST propane
10
Normal butane non-LST
08 Apr 14
Jun
28.750
Jun/Jun
07 Feb 14
000 bl
Jun
Propane non-LST/LST propane
50
¢/USG
Normal butane non-LST (cont.)
Jun
Jun/Jul
55
Timing
000 bl
E/P mix non-LST
Jun
Butane Mt Belvieu non-LST current month ratio to WTI
¢/USG
Jun/Jun
-0.500
10
Nat gas non-LST/non-LST Nat Gas
10
Jun/Jul
-0.875
50
Argus International LPG
Issue 14—111 | Friday 06 June 2014
The market peaked at 122.375¢/USG and shed 1.125¢/
USG to hit its session low of 121.25¢/USG. Average values
declined 62.5pt session-over-session. The LST marketplace
maintained a 2.25¢/USG discount relative to non-LST.
Meanwhile the two hubs saw a flat forward curve move to a
0.25¢/USG contango.
Isobutane at the non-LST hub changed hands at 127.50¢/
USG, or 50pt below the last session’s midpoint. After the
deal was done early in the session, bids and offers diverged
as far as 2¢/USG apart. July values firmed 25pt relative to
June.
Natural gasoline markets ended the day at parity
with the last session’s average value. While prices were
relatively strong throughout the session, the end of the day
saw a turn that priced the marketplace 1.50¢/USG below
the high trade of the day.
The non-LST natural gasoline marketplace opened at
213¢/USG, or 25pt below the last average price. After
hitting a high of 214¢/USG, values were jolted back and
forth in choppy trade with little clear direction. The
forward curve was also held unchanged as it was pegged at
a 75pt backwardation.
LATIN AMERICA
On Friday the VLGC Morston finished loading at Targa’s
Galena Park export terminal and began its journey to
South America. The vessel is moving to Suape, Brazil, and
potentially Santos as well. It is due to land at Suape on 18
June for an NOC.
The Navigator Mars was also finished loading at Targa.
The handy-sized vessel will sail to Omoa, Honduras.
At Enterprise’s Houston Ship Channel export hub, the
Clipper Victory returned from Chile. The VLGC loaded
alongside another VLGC, the BW Lord, which is expected to
sail to the Caribbean.
ANNOUNCEMENT
Argus Africa LPG 2014
16-17 September | Cape Town, South Africa
Register online and save US $155 with our early bird
discount. Offer ends 25 July 2014. For more information,
please visit our website www.argusmedia.com/africa-lpg
INDUSTRY NEWS
Australia’s April LPG exports fall
Australia’s April exports of LPG fell 46pc from a month
earlier to 94,793t to a four-month low because of a sharp
decline in propane and butane shipments to Japan.
Propane shipments dropped 40pc to 44,063t in April, its
lowest level since January, according to Australian Bureau
of Statistics (ABS) data. Propane shipments to Japan eased
to 21,000t in April from 48,000t in March. South Korea
bought 22,000t, unchanged from the previous month.
Butane exports fell 35pc to 50,700t in April, as exports
to Japan fell to 23,500t from 78,500t in March that had
been the highest level in more than two years.
Australia’s LPG exports generated A$88.43mn in export
earnings, or $82.36mn based on the average exchange rate
used by the ABS in April of A$1/$0.9314. This equates to an
average price of $868.85/t.
Rhine barge costs to remain up next week
Freight costs for refined products, petrochemicals and coal
barges on the river Rhine are set to rise further into next
week as water levels continue to fall.
Water levels at the key measuring point of Kaub fell by
5cm from yesterday’s levels to 170cm by 05:00 local time
Copyright © 2014 Argus Media Ltd
this morning, and are forecast to drop as low as 134cm by
the morning of 10 June.
Water levels at Kaub need to be above 180cm to allow
barges to load to their full capacity. Once the waters fall
below that level a surcharge of 10pc of the freight cost is
added for every 10cm drop to compensate vessel owners for
lost revenues caused by barges sailing partially loaded.
Moerdijk blast keeps styrene prices high
An explosion at the SMPO-2 petrochemical unit at Shell’s
Moerdijk site overnight on 3-4 June has led to a force
majeure on German chemicals producer BASF’s propylene
Argus Assessment Rationale Database
For prices used in financial benchmarks, Argus publishes
daily explanations of the assessment rationale with
supporting data. This information is available to permissioned subscribers and other stakeholders.
Subscribers to this report via Argus Direct or MyArgus
may access the database here.
Other subscribers may request access here or contact
us by email at [email protected].
Page 9 of 11
Argus International LPG
Issue 14—111 | Friday 06 June 2014
oxide supply, and expectations of higher styrene prices and
a tighter supply in the near future.
By the close of trading today, June and July’s prices
were above the $1,610/t mark, up by around $70/t
compared with 3 June, having initially jumped by around
$55/t on 4 June.
SMPO-2 is equally owned by the Shell-BASF Ellba joint
venture and has a capacity of 550,000 t/yr of styrene.
Total western European styrene capacity for 2014 is around
5.4mn t.
BASF has yet to issue a statement on its styrene supply
chain. But Styrolution — a styrenics producer owned jointly
by BASF and UK petrochemical producer Ineos — said it was
investigating the cause of the explosion.
Shell has a second wholly-owned styrene and propylene
oxide unit in Moerdijk — the 460,000 t/yr SMPO-1 — which
was unaffected by the fire. Ethyl benzene — used to feed
the units — is supplied from within the Shell system and by
BASF from its Antwerp site.
Part of BASF’s 890,000 t/yr ethyl benzene plant in
Antwerp is used to feed BASF’s needs for the Ellba unit in
Moerdijk. Styrene from BASF’s share of the Ellba plant is
sold to Styrolution as part of a 2011 deal that established
Styrolution as an independent entity outside the BASF
group. It is not known how long the SMPO-2 unit will be
out of operation, but is likely to last months rather than
weeks. Benzene demand for ethyl benzene to feed the unit
is around 35,000 t/month, split equally between BASF and
Shell.
Senate bill includes propane pricing plan
The US Senate Appropriations Committee yesterday passed
appropriations legislation that includes provisions for public
propane pricing education.
Senate energy Committee chairwoman Mary Landrieu
(D-Louisiana) included the provisions in the final bill. The
committee approved the FY15 Commerce, Justice and
Science Appropriations bill by a vote of 30-0, and approved
the FY15 Transportation, Housing and Urban Development
(THUD) Appropriations bill by a vote of 29-1.
Senate majority leader Harry Reid (D-Nevada) is
expected to move on appropriations bills, including those
passed yesterday, later this summer.
Landrieu included an amendment meant to unlock
Commerce Department funds directed at public outreach
once the price of propane gas rises beyond a certain level.
Under existing law, the Commerce Department annually
Copyright © 2014 Argus Media Ltd
calculates the price of consumer propane annually and
compares that price to an index of competing fuels. If the
propane price is more than 10.1pc of that index price, the
Commerce Department restricts funding to the Propane
Education and Research Council’s (PERC) educational
outreach budget. PERC is a federally-mandated propane
safety organization. The Commerce Department is also
required to update its propane price every 180 days, but
Landrieu said that calculation has not been completed since
February 2012.
Landrieu’s amendment directs the Commerce
Department to use propane pricing data available from the
Energy Information Agency to determine whether propane
prices have fallen below the 10.1pc threshold, unlocking
the PERC educational funds.
Landrieu said last winter’s propane price spike could
have been mitigated by consumers filling their propane
tanks for home heating earlier in the season. Landrieu said
the amendment “will allow PERC to reach out to consumers
and warn them ahead of time to be prepared and not wait
to fill their tanks.”
Canyon Midstream pens Permian deals
Canyon Midstream has reached agreements with ExxonMobil
subsidiary XTO Energy and US independent Apache for
capacity on its planned James Lake natural gas gathering
system in west Texas’ Permian basin.
The company declined to give the details of those
agreements but a spokesman said that XTO and Apache
would represent a significant part of the capacity at its
100mn cf/d James Lake gas processing plant in Ector
County, Texas.
The plant and other parts of the James Lake system
— which includes 60 miles (97km) of 12-inch diameter
pipeline and six compressor stations — is scheduled to begin
operations late this year. It will provide gas into the El Paso
natural gas pipeline and NGLs to the Chaparral and Sand
Hills pipelines.
The system will serve the Texas counties of Ector,
Andrews, Martin, Dawson and Gaines. Those counties sit
atop the Permian basin, an oil- and gas-rich formation
underlying west Texas and southeastern New Mexico.
Canyon Midstream is planning a second phase of the
James Lake system that will add another 100mn cf/d
processing plant and 60 more miles of 12-inch pipeline,
expanding the system into the Texas counties of Howard
and Borden by the second half of 2015, the company said.
Page 10 of 11
Issue 14—111 | Friday 06 June 2014
Argus International LPG
Argus European LPG Bulletin Board and Large Cargo
Propane cif ARA Calculator
Argus has launched a new European Bulletin Board which shows bids, offers
and deals done for propane and butane. The Bulletin Board is available to all
subscribers at: http://bbs.argusmediagroup.com/Login.aspx or via your My
Argus dashboard.
Argus also now produces a daily large cargo propane cif ARA calculator file.
This shows how Argus uses the various inputs including swap and physical
deals to establish the daily price. This is also available at the link above.
For details of your password and login information, please contact:
[email protected] or contact your local office www.argusmedia.com/
contact
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Contact us at [email protected] for more information.
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