EU LNG Imports Were on the Decline, But Not Anymore

Seaborne LNG imports to the EU have grown in size and importance of late, reversing the trend set for the most part of 2021. In a recent note, shipbroker Banchero Costa said that “global seaborne LNG (liquified natural gas) trade has been very disappointing in 2021. Already in 2020 trade slowed down considerably, given the impact from the Covid-19 lockdowns and restrictions. In the 12 months of 2020, total seaborne exports of LNG increased by a very modest +1.5% year-onyear to 362.8 mln tonnes, according to vessel tracking data from Refinitiv. Whilst this still represented an increase from the 2019 figure, the growth rate was significantly slower than the +11.1% increase recorded in 2019 and the +9.1% y-o-y in 2018. In the first 11 month of 2021, things were significantly worse”.

According to the shipbroker “in the period of January to November 2021, global LNG exports actually declined by a massive -9.1% y-o-y to just 299.6 mln tonnes, down from 329.7 mln tonnes in the same period of last year. Nevertheless, these totals mask significant differences in demand from the different importers. In Jan-Nov 2021, LNG imports to Mainland China still managed to increase by a very modest +1.7% yo-y to 59.8 mln tonnes. This is a significant slowdown from previous years, when volumes increased by +10.5% y-o-y in the same period of 2019, and by +14.0% y-o-y in the same period of 2018. Imports to Japan in Jan-Nov 2021 declined by -8.6% y-o-y to 61.1 mln tonnes. Japan remains the top importer of LNG in the world, but it’s margin over China is now wafer thin. Volumes to South Korea increased by +5.2% to 38.0 mln tonnes so far this year. To India they declined by -18.1% y-oy to 19.2 mln tonnes”.

Banchero Costa noted that “the worst performer by far this year has been the European Union. The European Union (27) imported 41.7 mln tonnes of seaborne LNG in Jan-Nov 2021, which was a -29.1% decline y-o-y. The EU is now the third largest importer of LNG in the world, with a 14% share. It follows Japan with 21% and Mainland China with 20%. In the first 3 months of 2021, the European Union imported 10.2 mln tonnes of LNG, which represented a massive decline of -44.5% y-o-y on the same period of 2020, although this reflects an unusually high base in 1Q2020, which was an all-time record. The second quarter of 2021 saw slightly better volumes, at 13.7 mln tonnes to the EU, which however was still down -24.0% y-o-y compared to a still strong 2Q2020”.

The shipbroker added that “in the third quarter of 2021, imports went down again to 10.0 mln tonnes, which was down -28.8% y-oy from the same quarter last year. October and November 2021 were not much better. November 2021 saw 4.0 mln tonnes delivered to the EU, which was -7.7% y-o-y compared to the same month in 2020. In terms of sources for LNG shipments to Europe, the largest and also the most constant supplier is still Qatar. In the first 11 months of 2021, Qatar shipped 10.9 mln tonnes of LNG to the European Union, down -11.6% yo-y. Qatar accounts for 26% of the EU’s total seaborne LNG imports. West Africa is in second place, shipping 8.0 mln tonnes to the EU in Jan-Nov 2021, down -16.3% y-o-y. West Africa accounts for 19% of EU’s LNG imports. The United States are in third place, with 7.8 mln tonnes in the same period, which was however down -40.1% y-o-y. The USA also account for 19% of EU’s LNG imports. Shipments from North Africa to the EU actually increased by +13.8% y-oy to 6.5 mln tonnes. From Russia they declined by most strongly, by as much as -44.7% y-o-y to 6.3 mln tonnes. Russia now accounts for 15% of the EU’s LNG imports”, Banchero Costa concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide