Japan's LPG stocks rose for the third-straight month in July, up 4.03% versus June to 1.907 million mt on higher imports, even as demand recovered, Japan LPGas Association data showed Tuesday.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
Imports at the end of July jumped 26.7% month on month to 958,000 mt, rebounding from a downtrend seen since March, the data showed.
Import terminal running stocks, or supplies that refiners or importers can draw on, increased by 33% month on month to 310,000 mt in July, after rising 55.3% to 233,000 mt in June, the data showed.
The rise in overall inventories was led by propane, which climbed 11.3% month on month to 1.218 million mt in July, while butane stocks continued to fall, down 7.3% to 689,000 mt, according to the data. However, total LPG stocks were down 5.2% year on year.
Total LPG demand in July surged 20.1% month on month to 1.149 million mt, recovering after sliding 17% in June to 957,000 mt. This was led by a rise in electricity demand to 118,000 mt in July, as cooler weather despite the onset of summer stoked greater use of hot water heaters though demand for air conditioners was weak.
The rise in imports came despite concerns over costly freight rates for the Persian Gulf-to-Japan route, which hit record peaks around $140/mt during late July, making it difficult to move cargoes from the Middle East on an FOB basis.
But traders said this could have been filled by cargoes from the Atlantic Basin.
In June, the price of propane cargoes for delivery along the major Singapore-Japan route over July was assessed at firm levels between $882/mt and $941/mt, Platts data show. Prices have since weakened and propane was assessed Monday at $826/mt for H2 September-delivery cargoes.
Government-mandated stocks at the end of July, which comprise a large portion of privately held LPG stocks, dipped 0.27% to month on month to 1.484 million mt, the data showed.
Similar stories appear in LP Gaswire See more information at http://www.platts.com/Products/lpgaswire