Skip to main content

China to resume U.S. LPG imports as Beijing waives trade-war tariff: sources

China has begun buying U.S. liquefied petroleum gas (LPG) again after a hiatus of nearly 20 months as Beijing waived punitive tariffs to boost imports of U.S. goods as part of the Sino-U.S. Phase 1 trade deal, industry sources said.
Image
Importers have rushed to apply for waivers for the 25% tariff to buy the fuel, a by-product from U.S. shale gas production, after Beijing started granting exemptions this month for nearly 700 U.S. goods.
About a dozen firms - including China Gas Holdings (0384.HK), a piped gas distributor and LPG trader, and Oriental Energy (002221.SZ), a manufacturer using LPG to make petrochemicals - have been granted the tariff waivers, according to two veteran LPG traders, an investment officer and analysts at IHS Markit.
With the exemptions, U.S. LPG is subject only to a 1% import duty, same as rival supplies from the Middle East.
“U.S. LPG provides us a diversified source of supply to keep our overall import cost low,” said Tan Yuwei, an investor relation officer with China Gas, adding that the firm has booked 60,000 tonnes of U.S. fuel for late April arrival.
An official with Oriental Energy confirmed his company won a tariff exemption but declined to comment on any purchases.
The LPG traders declined to be named because they are not authorized to speak with the press.
Yanyu He, IHS Markit’s Houston-based senior analyst for natural gas liquids, said he expected Chinese bookings of U.S. cargoes to re-emerge from April, although the sudden crash of oil prices to sub-$30 a barrel will see U.S. LPG output decline.
China may have booked an estimated five U.S. cargoes totaling 220,000 tonnes so far, said a Beijing-based IHS analyst who also declined to be named as he is not authorized to speak to the media. This analyst said a slow rebound in Chinese petrochemical production following the coronavirus outbreak could hold back purchases.
The resumption of U.S. trade is set to weigh on prices of competing cargoes from Qatar and Saudi Arabia.
Benchmark U.S. spot butane prices BUT-USG in Mont Belvieu, Texas, have lost two-thirds of their values over the past month, dropping to their lowest since at least 1990 at $0.21 per U.S. gallon, primarily tracking the free-fall in oil prices.
That is equivalent to about $95 per tonne, and compares with April Asian LPG paper at $150 a tonne.
China was the No.2 buyer of U.S. LPG exports in 2017, with purchases at 3.6 million tonnes, then worth some $2 billion. Imports began shrinking in late 2018 and nearly dried up last year during the prolonged U.S.-China trade war.
U.S. LPG, typically in 44,000 tonne cargoes and sailing through the Panama Canal, takes about two weeks to get to China.
LPG consists of propane and butane used for heating and making petrochemicals.





















































Comments

Post a Comment

Popular posts from this blog

Dozens killed after gunmen attack Kabul ceremony

The Taliban denied responsibility for the attack on the gathering marking the anniversary of the death of Abdul Ali Mazari, an ethnic Hazara leader who was killed by Taliban fighters in 1995 after being taken prisoner [Anadolu] The death toll in an attack on a Kabul ceremony  marking the anniversary of a slain minority leader has risen to  27, a ministry of health spokesman said on Friday. "Twenty-seven bodies and 29 wounded transported by ... ambulance so far," Wahidullah Mayar, the health ministry spokesman, told Reuters, adding that the number could increase. Gunmen attacked the ceremony in the Afghan capital where a top Afghan political leader, Abdullah Abdullah, was present but escaped unharmed. "The attack started with a boom, apparently a rocket landed in the area, Abdullah and some other politicians ... escaped the attack unhurt," Fraidoon Kwazoon, Abdullah's spokesman, was quoted as saying by Reuters news agency. President Ashraf Ghani cond
Post a Comment
Read more

How firms are stamping out fake goods with high tech labels

Every working hour, about 80,000 bottles of beer are processed through the East African Breweries Ltd (EABL)   production line at the Ruaraka factory. An almost equal number of cans is processed on a parallel line. However, not even one of the bottles or cans can leave the factory before it has been affixed with the Kenya Revenue Authority’s excise duty and the Kenya Bureau of Standard stamps. Each of the two security stamps tells a story; one says that the brewer has paid excise tax while the other assures consumers that the quality of the product has been tested and certified as fit for human consumption. One has an implication on public good while the other has direct import on public health and safety. These twin messages are at the very heart of every security stamp affixed on any product made or sold in Kenya. The stamps, just like the security marks affixed on identity cards, passports, title deeds and other important documents as well as products meant for publ
Post a Comment
Read more

Ighalo among loanees in limbo after corona pandemic halts season

London, Monday The January transfer window brought with it hopes of a fresh start for players and clubs who had struggled to make their mark in the first half of the season.  A host of high profile names completed temporary moves as they sought to impress both their parent clubs and new employers ahead of potential summer moves.   But none of them had expected a global pandemic to block their path as they dusted down their boots and prepared to inject new life into their careers.  Odion Ighalo There’s nothing worse than watching a Hollywood story unfold in front of your eyes and then being denied the ending.  Ighalo, a childhood United fan, completed a shock loan move to Old Trafford on deadline day having spent the previous two years playing his football in China.  Ighalo made it out of China and just before the country put in place a lockdown to halt the spread of coronavirus, while the striker didn’t travel to United’s winter training camp in Spain in case he wasn
Post a Comment
Read more