Demand for maritime LPG is higher this year despite a mixed picture from one region to another

The global LPG maritime trade has improved this year, which has helped LPG shipping companies. In its latest weekly report, shipping broker Banchero Costa said “Global LPG trade has remained fairly positive so far in 2021, despite the global impact of COVID-19. Even in 2020, total LPG imports by sea increased + 0.9% year-on-year to 137.5 million tonnes, according to ship tracking data from Refinitiv. While this still represents an increase over the 2019 figure, the growth rate has been significantly slower than the + 4.0% increase recorded in 2019 and + 7.7% year-on-year in 2018 ”.

According to the shipping broker, “In the first 10 months of 2021, the trend has remained similar to last year. Between January and October 2021, global LPG imports increased + 1.4% year-on-year to 116.0 mln tonnes, compared to 114.4 mln tonnes in the same period last year. However, these totals mask significant differences in demand from different importers. From January to October 2021, LPG imports to mainland China increased by a very good + 20.5% year-on-year to reach 21.9 mln tonnes. This is a significant acceleration from last year, when volumes grew only + 2.1% year-on-year over the same period.

Source: banchero costa & c spa

Imports to India from January to October 2021 also increased by + 2.9% year-on-year to reach 14.6 mln tonnes. Volumes to Japan increased by + 1.5% to 8.3 mln tonnes. For South Korea, they increased by + 6.6% year-on-year to 6.8 mln tonnes. The only major importer that has experienced a significant contraction this year has been Europe. The European Union (27) imported 17.4 million tonnes of LPG by sea from January to October 2021, a decrease of -7.1% year-on-year. This was quite surprising, as even last year imports into the EU grew + 2.5% year-on-year in the same time of year. As a result, the EU is now overtaken by China as the world’s largest importer of LPG ”.

“Mainland China now represents 18.9% of global LPG maritime trade, ahead of the EU27 with 15.0%. In the first 3 months of 2021, the European Union imported 5.4 million tonnes of LPG, which is a decrease of -12.6% year-on-year compared to the same period of 2020, although this is reflects an unusually high base in 1Q2020. The second quarter of 2021 was stable in terms of volume and saw shipments again at 5.4 million tonnes to the EU, which was however + 13.3% year-on-year compared to a very poor 2Q2020 . In the third quarter of 2021, imports fell to just 4.9 million tonnes, down -14.4% year-on-year from the same quarter last year, the worst quarter since the first half of 2020. Following the signing of the trade agreement with Trump. administration, China has generally complied by significantly increasing its imports of US energy products, including LPG, ”said Banchero Costa.

Source: banchero costa & c spa

The shipping broker added that “while the LPG trade from the United States to China stopped in 2019 (it was only 0.20 mln tonnes!), In 2020 the United States is became China’s leading LPG supplier with 5.28 mln tonnes. In the first 10 months of 2021, China imported 7.3 million tonnes from the United States, up + 74.7% year-on-year. Probably as a result, less American LPG was available in Europe. In the first 10 months of 2021, US LPG imports to the EU declined -23.5% year-on-year to 4.1 million tonnes. The United States nevertheless remains the EU’s leading maritime LPG supplier, with 23.6% of volumes. A further 21.3% of EU maritime imports came from other EU countries. This amounted to 3.7 mln tonnes in January-October 2021, up + 2.6% year-on-year. Other LPG suppliers to Europe include Algeria with 3.1 million tonnes in January-October 2021, + 13.6% year-on-year. Similar volumes come from Norway with 3.0 mln tonnes, + 8.4% year-on-year. Further down the list are the UK with 1.7 million tonnes shipped to the EU, down -5.9% year-on-year, and Russia with 0.5 million tonnes, -46, 8% year-on-year, ”concluded the shipping broker.
Nikos Roussanoglou, Hellenic Shipping News Worldwide