Price trend

In May, the domestic propane market continued to decline. According to data monitoring by SunSirs, the average market price of propane in Shandong was 5,075 RMB/ton on May 1st, and 4,450 RMB/ton on May 31st. The monthly decline was 12.31%, and a decrease of 30.82% compared to the same period last year.

Analysis review

The propane market continued to be weaker in May, and prices further declined due to demand constraints. At the beginning of the month, after the holiday, propane prices continued to decline due to the broad decline in international oil prices during the holiday period, which suppressed the mentality of operators. The May CP was introduced, with prices basically unchanged compared to April, and limited news support. In the middle of the month, propane prices continued to decline, and downstream demand did not significantly improve. At the same time, crude oil had repeatedly declined, suppressing market sentiment, and the low supply of goods at ports had further impacted the domestic propane market. Downstream demand was lower than expected, the market trading atmosphere was difficult to improve, on-site inventory was high, and factories were reducing prices to destock. Under the influence of multiple bearish factors, the weak market continued throughout May.

Saudi Aramco's May CP was introduced, the contract price of propane remained unchanged compared to the previous month, and butane slightly increased. Among them, propane was 555 US dollars per ton, which is stable compared to the previous month; Butane was 555 US dollars per ton, an increase of 10 US dollars per ton compared to the previous month.

Market outlook

Overall, the price of propane had dropped near the cost line, and upstream shipments had improved. It is expected that there is limited room for the low price of propane to continue to decline in the short term.

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