Last week, the LNG market saw a relatively calm period with flat rates across all major routes, while the LPG market faced sharp declines due to national holidays in the East and limited activity. Although some LNG inquiries were noted for ships in the Pacific, the upcoming winter season hasn’t sparked much movement yet. Meanwhile, LPG rates dropped significantly, marking the lowest levels since February, driven by low product movement and an excess of tonnage, reports Baltic Exchange.
LNG
As GasTech once again took a large proportion of the LNG market to Houston where discussions on the future and current state of LNG took place, the physical market had a relaxed week on the spot side. Rates were flat across all three routes. Although some inquiries for ships in the Pacific did look at ships, there hasn’t been much shown for the winter period yet.
For BLNG1 Aus-Japan the 174cbm lost only $600 staying flat for the most part printing at $72,400 while the 160cbm TFDE ship also lost $600 down to $57,200. For BLNG2 Houston-Cont some positive gains on the 2-stroke and TFDE pushed the 174cbm up to $59,500 while the 16cbm remains $13,000 lower at $46,500. The BLNG3 Houston-Japan gained more on the modern 2-stroke pushing up $3,337 to $79,437 widening the delta between the 174cbm and 160cbm to around $16,000, meaning the 160cbm TFDE published down only $81 at $62,900.
Several owners are offering ships between 1- and 3-year period terms but with the bearish sentiment at the moment there isn’t much bite from charterers whose ideas are lower than what owners are expecting to be able to get over the winter months. The assessment on the 6-month term was down $2,500 at $79,900, while the 1-year at $69,967 lost just over $3,000 and the 3-year period fell $100 to $79,900.
LPG
There were several national holidays out East, which along with some people travelling created the perfect storm for rates to take a battering. Few fixtures are being done and those that are at ever-decreasing levels are putting plenty of pressure on the rates. With a reported cargo in the AG going to India at $35 some brokers believe that BLPG1 Ras Tanura-Chiba will consolidate around $37 (close to the Baltic Print). Rates themselves have fallen to the lowest we have seen since the first week of February and BLPG1 Ras Tanura-Chiba lost 24.66% or $9.166 to a close of $37.167 and a daily TCE earning of $17,855 a drop of nearly 47%.
Across the Atlantic where some people are attending GasTech it was much the same story. BLPG3 was hit hard losing $22 or 27.85% in a week falling to the lowest levels since the first week in February and publishing at $79, with TCE earning on BLPG3 falling by 70.18% to $21,157. When the market stalls like this, BLPG2 Houston-Flushing is oft forgotten about with no product moving and this was reflected in the rates where it fell by $12.75, a drop of 29.82% to $42.78 while TCE earnings dropped by over 50% to $36,044. A sentiment-driven market like the LPG can struggle to turn the tide when faced with long tonnage, low product necessity coupled with larger output, the bottom may be hit, or close to it, but there is not much enthusiasm from market participants.
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Source: Baltic Exchange
