StealthGas INC Weekly Market Report 21/May/10 - 28/May/10

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31 May 2010

NWE/MED - As anticipated, it has been a week with limited activity for the European coaster mrkt with a few requirements shown in the mrkt both in the NWE and in the MED, while petchems have remained for another week the main driver behind fleet

availability. More specifically, the NWE propane coaster mrkt was pretty quiet this week with buyers and sellers keeping a reserved attitude towards trading. On the butane coaster market side, blenders and petchems remain the main buyers for this product but generally buyers have become slower to act in anticipation of potential lower prices if this pace keeps up. Product availability is somewhat scarce especially for good quality product. On the propane coaster market side, activity has been slow as current warm weather conditions in the area have been putting a damper on buying interest. In addition, it has been reported there are few open ships in the North Sea area but it does not look like there will be many more ships available in the region at least until the back end of June, which of course provides a somewhat positive “assistance” in keeping the rates at recent firm levels…
Moving to the MED now, activity was similarly uneventful with subdued buying interest, while only a few cargoes were quoted and corresponding fixtures, leaving the availability of prompt tonnage somewhat improved. In the propane coaster market activity was very thin with buying at low levels and almost no transactions to report. Spot fob prices dropped in line with falling crude and generally as the market keeps on falling buyers are on the sidelines waiting for June postings and lower prices. In the butane coaster market, activity was also stagnant with nearly all refinery surpluses being absorbed by petchems. Also there was no fob sales reported ex Lavera and Italy, although in addition, it is worth to mention that the various tenders into France and Portugal, amongst other destinations will be discussed over the coming weeks and TC activity will no doubt follow. At the moment, Owners feel reasonably confident that the mrkt is pretty well balanced and with the Eastern TC mrkt holding it’s own there is certainly little threat of vsls positioning to Europe in the short term…      

SEA/FEAST

In the Feast market now, LPG prices seem to be tumbling as crude prices continue to fall. This decline is creating problems for the arbitrage that has been going on from the West and Africa. Demand for lpg this week was rather weak due to the discount on naphtha products despite the fact that Naphtha’s spread has narrowed to USD 30 per ton from USD 50 per ton from last week. A Taiwanese refiner opted to book out June LPG cargoes intended for petrochemical production, another refiner halted cracking of LPG at its petrochemical plants and offered cargoes for exports in June. The refiner last sold LPG for April lifting. 
Steady end user demand in Southeast Asia was seen. A Thai refiner was heard to have bought a cargo tender with del 17-18 June, after obtaining two such cargoes for early-June delivery and also buying 44k tons per month for July through September deliveries. On the other side imports into china have slowed down as buyers are not in a rush to conclude any deals as they are waiting for prices to drop even further.
In the pressurized lpg segment, the F. E. Asian LPG mrkt was for another week at same levels as last, with trading activity at somehow lower levels and with an overall amount of reported fixtures somehow reduced compare to last week; nevertheless, the overall spot rates remain competitive and in line with last month’s levels…On the petchems’ front now, the situation there is still unchanged but with fewer propylene cargoes circulated in the mrkt for this week. Ppl product prices have remained same as last week, while the region’s supply issue is still a constraint. Overall, although for another week this mrkt was healthier and more active than the West, demand remained somewhat limited. Now, moving to C2, product prices remained flat for another week as no further activity was reported. C2 committed ships remain mostly open prompt arnd the same areas as we reported here last week (i.e. Spore or Korea). Now, as far as the VCM front is concerned, product prices there still flat as this particular mrkt remains exceptionally inactive for yet another week, with no new enquiries circulated in the mrkt during the week. Last, the CC4 remains relatively busy on the term side of the mrkt as COA/TC dedicated fleets remain well programmed and now shown beg June open positions. BTD and but1 on the other hand has become even more quiet compared to recent weeks.

Time Charter Fixtures

Marangas Vergina (82,000cbm) was extended for 1 yr to a/c Naftomar bss del June/Jule @ market related level.

Lotus Gas (80,000cbm, blt ’08) was fixed for 50-85days TC to a/c Andromeda bss del/redel SEA, laycan end May @ usd19,750pdpr.

Telendos (35,000cbm, blt ’93) was fixed for 30-40days Tc to a/c Transammonia bss del end May, del/redel MEG – hnr.

Ennerdale (4,000cbm, blt ’97) was fixed for 2 months + 1 month in chopt to a/c Stasco bss del June, del/redel NWE – hnr.

Sale and Purchase/New Buildings


Scrapping 
None reported.

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Source: StealthGas INC

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