Sunday, May 28, 2023
HomeGasChina pares spot LNG purchases as high prices bite, inventories ample

Subscribe

To our FREE newsletter
Get all the latest maritime news delivered straight to your inbox.

China pares spot LNG purchases as high prices bite, inventories ample

Chinese buyers of liquefied natural gas (LNG) are pulling back on spot purchases of the super-chilled fuel as prices remain high and inventories are ample, several trade sources told Reuters.

Close to record high freight rates are also crimping demand in the world’s top LNG buyer, resulting in only minor interest from Chinese buyers in the spot market for January cargoes in recent days, sources said.

LNG shipments to China in November slipped by about 2per cent from the previous month to the lowest monthly volume since February, shiptracking data from Refinitiv Eikon showed. Official customs data for the month is yet to be released but October’s shipments stood at 6.17 million tonnes.

The drop, which followed a robust first 10 months of purchases that saw imports soar 22.5per cent on year to a record 64.5 million tonnes, is unusual as LNG shipments typically rise in November to meet increased heating demand during winter.

“Chinese buying is muted in the spot market as inventory levels are in the mid to high levels,” a Chinese-based LNG trader said.

“The three national oil companies have prepared well this year in terms of buying through term contracts and pipelines, so for now there is not much need for more cargoes, though this will depend on weather.”

Another source added that the government’s tolerance of additional coal burning has also dampened appetite for more expensive LNG. Beijing ordered coal miners to boost output and power plants to raise supply and resolve a power crunch that hobbled industry in the autumn, easing restrictions on coal-fired generation.

Some importers are facing steep losses after spot LNG prices in the international market spiked by 22per cent in a month, while domestic LNG prices tanked by nearly 10per cent to around 7,100 yuan per tonne ex-terminal in the same period, traders said.

The price slide was caused in part by surging coal output, effectively curbing demand for natural gas as a heating and power generating alternative.

Gas demand is also subdued as China has ordered industrial production curbs across at least six provinces in north China through March to minimize pollution during the Winter Olympics.

“Terminals are chasing us to lift shipments as soon as possible as their tanks were overflowing,” said a Beijing-based state-run gas trader.

Source: Reuters

Related Posts

Video

Finance & Economy
Shipping News
Ports

Seanergy ‘well positioned to benefit from positive trend in Capesize market’

Seanergy Maritime Holdings Corp., announced its financial results for the first quarter ended March 31, 2023, and declared a quarterly dividend of $0.025 per...

Dorian LPG sees Q1 revenue more than double year-on-year

Dorian LPG reported its financial results for the three months and fiscal year ended March 31, 2023. Highlights for the Fourth Quarter Ended March 31, 2023 Revenues of $133.6 million.Time...

Navios Holdings Posts $14.5 Mln Net Income in Q1

Navios Maritime Holdings Inc., reported its financial results for the first quarter ended March 31, 2023. Navios Holdings owns (i) a controlling equity stake...

BW LPG posts ‘strongest quarterly performance on record’

BW LPG has recorded its ‘strongest quarterly performance on record’ in the first three months of 2023. The company was boosted by strong exports...

ONE, Wan Hai agree to pay civil penalties to FMC

Ocean Network Express (ONE) will pay a US$1.7 million civil penalty to avoid a formal investigation by the US Federal Maritime Commission (FMC) for...

Nikolaus H. Schües elected BIMCO President

BIMCO has elected Nikolaus H. Schües , CEO and owner of Reederei F. Laeisz,...

Baltic Dry Bulk Index Ends Worst Day In Over Three Months

The Baltic Exchange’s main sea freight index declined the most since mid-February on Thursday...

Maritime UK appoints new Chief Executive Officer

Maritime UK, the umbrella organisation for the UK’s maritime sector, has appointed Chris Shirling-Rooke...

Baltic dry bulk index extends slide for 10th straight session

The Baltic Exchange’s main sea freight index of shipping rates for dry bulk commodities...

Baltic index hits over two-month trough on lower rates across vessels

The Baltic Exchange’s main sea freight index slumped to its lowest level in over...

DP World Completes Terminal Expansion Project Vancouver Port

DP World has completed the AED954 million ($259.78 million) Centerm expansion project, increasing container throughput at the Port of Vancouver by 60 percent. The terminal...

DP World completes AED 954 million Vancouver port expansion

DP World and the Vancouver Fraser Port Authority have celebrated two historic events – the completion of the Centerm Expansion Project at DP World...

Alexandroupolis port gets 24 million euros of EU funding

Greece has secured 24 million euros ($26 million) in European Union funding to upgrade its northern Aegean Sea port of Alexandroupolis, privatisation agency HRADF...

Port Hedland Iron Ore Exports Down 5% in April

Pilbara Ports Authority (PPA) has delivered a total monthly throughput of 57.7 million tonnes (Mt) for April 2023. This throughput was a two per cent...

APM Terminals Reveals $1 Billion Investment in Brazil

APM Terminals’ CEO Keith Svendsen has pledged an investment of about US$1 billion in the company's Brazilian operations up to 2026. The amount includes around...