Flows of LPG from the US Gulf Coast to Northwest Europe are expected to rise in May, with three VLGCs and one Handysize vessel expected to arrive in the first week of the month alone, according to data from S&P Global Platts trade flow software cFlow.
The 49,999 dwt Yushan is expected to arrive on May 1 into Flushing, in the Netherlands from Houston; the 53,658 dwt Levant is expected to arrive on May 2 from Freeport, Texas; the 51,700 dwt Gas Summit is expected to arrive in Flushing on May 4 from Houston, and the 23,640 dwt Navigator Pegasus is expected to arrive from Houston into Flushing on May 7, implying a sharp uptick in overall arrivals from April.
That has led to a swift drop in the spot propane large CIF cargo market, which fell from large premiums for April into modest discounts for cargoes lifting in the first half of May.
However, the swift pace at the front of the month may actually slow later into the month, a source said.
"I think May could be one of those months where we have a little bit of length on the supply side at the start of the month, and it fades a bit as we come into the second half of the month," the source said, adding that prices in Asia were still pulling product east from the US at the expense of incoming product in Europe.
That follows a relatively strong April, on the back of expectations that incoming supply would be much lower than March.
April has so far seen an expected total of about 170,000 mt from the US Gulf Coast, with an additional VLGC, the BW Loyalty, arriving in the region from Marcus Hook, on the east coast of the US.
Those arrivals, which included the Lycaste Peace, the Commander, the Libramont, the Navigator Aurora and the Ocean Orchid, ultimately brought April just slightly below March in total volumes, although expected tightness on arrivals helped the spot market keep hefty premiums throughout the month against the paper market.
VLGCs crossing the Atlantic from the US Gulf Coast to Northwest Europe usually serve the propane market in the region, where the product is used for inland heating during winter and as a petrochemical feedstock.
