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SunSirs: Propane Market Fluctuated and Fell in September
October 12 2020 07:37:18SunSirs(John)

In the peak season of September, the propane market showed a fluctuating downward trend, and the peak season was not busy. According to the data monitoring of SunSirs, the average market price of propane on September 1 was 3,547.50 RMB/ton, and the average price on the 30th was 3,277.50 RMB/ton. In September, it fell by 5.21%, down 16.50% from the same period last year.

In September, the center of gravity of the propane market moved downward as a whole. In the first ten days of September, there was a continuous decline. In mid-September, the rebound was met with obstacles, and in the last ten days of the month, the decline was again. Compared with previous years, the market this year was not optimistic. One of the main reasons why the peak season was not prosperous was due to the suppression of international crude oil. The trend of international crude oil in September was uncertain, mostly falling. The news was negative in the market mentality. The civil gas market followed the trend and the propane fell significantly. Secondly, after the introduction of CP prices in September, propane remained stable compared with the previous month. Although there was support for the spot market, the benefits were limited. The most important point is the demand side. Due to the slow increase in terminal demand in September, and although the weather has cooled, overall demand has not increased significantly. The market is still in a weak state. The downstream market is generally enthusiastic and cautious.

In mid-September, the market rebounded in stages, mainly driven by the rise of international crude oil, but the market's negative factors still existed. As crude oil prices fell behind, propane rose weakly and fell again. Until the end of the month, the propane market continued to fall. Due to the approaching double festival, the demand from manufacturers for storage before the festival, and the concentration of ships at the port at this stage had brought significant pressure on the market. The sales of manufacturers were weak, and continued to give profits to stimulate downstream entry into the market.

In the international market, Saudi Aramco launched CP in October 2020. Propane was 375 US dollars/ton, an increase of 10 US dollars/ton from the previous month; butane was 380 US dollars/ton, an increase of 25 US dollars/ton from the previous month.

CP prices were released in October, and both propane and butane rose, which brought significant support to the market. And with the arrival of Silver October, the weather gradually turns cold, and there are still expectations for an increase in downstream demand. Due to the low peak season in September, the propane market price has been at a relatively low level. After the holiday, with downstream replenishment, the sales of manufacturers are expected to be good. It is expected that propane may still rise in October.

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