Qatar's Tasweeq has a mixed refrigerated LPG cargo that is currently sailing to Japan -- but in a rare occurrence -- has yet to find a buyer, several trade sources including Japanese importers said this week.
The cargo, which loaded from Ras Laffan over December 3-4 on MOL vessel Al Wukir, comprises 44,000 mt of refrigerated LPG in a 3:1 propane-butane ratio. The vessel is expected to arrive in Japan around December 21-22, said sources.
"Japanese [LPG] importers have covered December arrival cargoes, so there is really not so much of a demand [for the cargo]," said a Japanese importer.
A broking source agreed, saying: "Who wants second half December arrival cargo? At the moment, no one wants a first half January arrival cargo."
Adequate inventory levels and a January/February backwardation -- currently well into the $20's/mt -- have reduced Japanese buying demand for January arrival cargoes, with importers appearing more keen for February arrival product.
The LPG broker noted that Tasweeq was looking to sell the cargo for three weeks and had received bids based on Saudi Aramco's January CP and Argus' Far East Index.
"I'm not sure why they have been sitting on the cargo. They have had this to sell for three weeks. My guess is they read the market wrong," said the broker, explaining that Tasweeq was probably hoping for an upturn in LPG prices.
After coming within kissing distance of record high levels on December 6, when CFR Singapore-Japan propane and butane cargoes for delivery 30-45 days forward closed at $982/mt and $1,017/mt, prices have fallen steadily to settle at $939/mt and $929/mt, respectively, Thursday. CFR propane and butane prices touched record high levels on July 4, 2008, when they settled at $986/mt and $1041/mt, respectively. Said a Japanese importer: "I don't know why they [Tasweeq] couldn't wait; I don't know about their situation ... whether they had to use the vessel or if they had a tank-top situation."
The broking source said the cargo will eventually get sold. "It just depends on at what price," he said.
But another Japanese importer pointed out that the promptness of the cargo will make it difficult to place.
"The cargo is so prompt, it is almost impossible to take. Traders can't take it and only importers with available storage can look at it if their program still allows it," he said.
Tasweeq has so far sold 88,000 mt of December-loading refrigerated LPG in two 44,000 mt cargoes, both comprising product in a 3:1 propane-butane ratio. Both cargoes were sold at a high single digit premium to Saudi Aramco's December LPG Contract Price on an FOB basis, Platts reported earlier, citing trade sources.
Tasweeq sold at least 220,000 mt of November-loading mixed refrigerated LPG in six cargoes via private negotiations, trade sources said earlier.
The cargo, which loaded from Ras Laffan over December 3-4 on MOL vessel Al Wukir, comprises 44,000 mt of refrigerated LPG in a 3:1 propane-butane ratio. The vessel is expected to arrive in Japan around December 21-22, said sources.
"Japanese [LPG] importers have covered December arrival cargoes, so there is really not so much of a demand [for the cargo]," said a Japanese importer.
A broking source agreed, saying: "Who wants second half December arrival cargo? At the moment, no one wants a first half January arrival cargo."
Adequate inventory levels and a January/February backwardation -- currently well into the $20's/mt -- have reduced Japanese buying demand for January arrival cargoes, with importers appearing more keen for February arrival product.
The LPG broker noted that Tasweeq was looking to sell the cargo for three weeks and had received bids based on Saudi Aramco's January CP and Argus' Far East Index.
"I'm not sure why they have been sitting on the cargo. They have had this to sell for three weeks. My guess is they read the market wrong," said the broker, explaining that Tasweeq was probably hoping for an upturn in LPG prices.
After coming within kissing distance of record high levels on December 6, when CFR Singapore-Japan propane and butane cargoes for delivery 30-45 days forward closed at $982/mt and $1,017/mt, prices have fallen steadily to settle at $939/mt and $929/mt, respectively, Thursday. CFR propane and butane prices touched record high levels on July 4, 2008, when they settled at $986/mt and $1041/mt, respectively. Said a Japanese importer: "I don't know why they [Tasweeq] couldn't wait; I don't know about their situation ... whether they had to use the vessel or if they had a tank-top situation."
The broking source said the cargo will eventually get sold. "It just depends on at what price," he said.
But another Japanese importer pointed out that the promptness of the cargo will make it difficult to place.
"The cargo is so prompt, it is almost impossible to take. Traders can't take it and only importers with available storage can look at it if their program still allows it," he said.
Tasweeq has so far sold 88,000 mt of December-loading refrigerated LPG in two 44,000 mt cargoes, both comprising product in a 3:1 propane-butane ratio. Both cargoes were sold at a high single digit premium to Saudi Aramco's December LPG Contract Price on an FOB basis, Platts reported earlier, citing trade sources.
Tasweeq sold at least 220,000 mt of November-loading mixed refrigerated LPG in six cargoes via private negotiations, trade sources said earlier.
