ARA inland propane prices fall to more than one-year low

Propane produced in the Amsterdam-Rotterdam-Antwerp region for inland consumption fell to a more than one-year low on over-supply and limited demand from the heating sector.

Platts, part of S&P Global Commodity Insights, assessed propane FOB ARA, barges, at $647/mt Nov. 1, down $12 on the week from $659/mt, Oct. 25. This puts the barge market at the lowest level seen since Aug. 31, 2021. Propane FCA ARA, railcars and trucks, was assessed at $724.25/mt on Nov. 1, down $14.75 on the week and the lowest value seen since Sept. 7, 2021.

Europe has seen length build as volumes from the US continue to add to an overabundance of supply in the market.

"There is very limited demand, but we have to clear product as more volumes from the states are coming into Antwerp," an inland source said.

Propane is typically used for domestic heating in countries like Germany, while the above average weather conditions has provided little support in absorbing any of the excess supply in the inland propane market.

While inland sources expect prices to climb this month as pockets of demand begin to appear, LPG distributors expect the current temperatures and more volumes from the US to mitigate any significant improvements in demand.

As refineries begin to become operational again in countries like Germany and France, sources suggest more LPG should be flooding into the market, which may amplify the downward pressures on prices in the inland market if demand doesn't ignite this month.

"TTF is getting another hit today, so there is less incentive to use LPG in the refinery," a distributor said.

Meanwhile, the large cargo market has been strengthening amid improved LPG activity in the East and stronger Brent crude prices. Platts assessed the CIF NWE large cargo at $594.25/mt, up $36.25 on the week from $558/mt on Oct. 25.