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China’s Dec LPG imports fall 8% on month to 8-month low of 1.87 mil mt

China’s LPG imports fell 7.6% month on month to an eight-month low of 1.87 million mt in December, but were still 12.3% higher year on year, General Administration of Customs data released Jan. 20 showed.

Propane imports fell 11.5% month on month to 1.46 million mt in December, which was partially offset by butane imports rising 9.6% over the same period to 416,006 mt, the customs data showed.

A fall in propane import costs in December failed to stem the decline in propane import volumes as many of China’s propane dehydrogenation plants shut for maintenance or lowered operating rates in the month in a bid to reduce processing losses.

China’s PDH plants operated at an average run rate of 80% in December, down from 86% in November, as the theoretical processing margin hit a record low at minus Yuan 1,815/mt ($283.82/mt), down sharply from minus Yuan 1,358/mt in November, S&P Global Platts reported earlier.

The average price of China’s propane imports was estimated at $818/mt on a delivered basis in December, down 4.6% month on month, the first decline after six consecutive months of increases, Platts calculations showed.

In addition to weaker demand from PDH plants, milder-than-expected weather in December curbed winter LPG consumption by residential users, market sources noted.

China imported 24.5 million mt of propane and butane over January-December, up 24.6% year on year, reflecting the country’s strong LPG demand growth in the year.

Four new PDH plants commenced operations in 2021, adding a total 2.5 million mt/year of propylene production capacity that would require up to 3 million mt/year of propane as feedstock when operating at full capacity.

The US remained China’s largest LPG supplier at 639,042 mt in December and 8.4 million mt in 2021, up 24% and 75% respectively year on year, the customs data showed.

The US supplied 34.3% of China’s LPG imports in 2021, up from 24.4% in 2020, the data showed.
Source: Platts

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