China’s LPG imports will rebound in 2019 after dismal growth of a little over 20 000 bpd in 2018, according to ESAI Energy’s newly published Global LPG Outlook. A new wave of PDH investment will reignite Chinese demand. In a market flush with new supply, exporters will count on an uptick in Chinese demand to stave off a global glut.
After a lull in Chinese PDH investment, a new round of projects will breathe life into LPG demand growth next year, according to ESAI Energy. In the past 18 months, there were only two small additions to Chinese PDH capacity totalling 215 000 t of propylene, which has a negligible impact on propane use. ESAI Energy expects China, which currently has 5.9 million t of PDH capacity, to bring online another 2.2 million t between now and the end of 2019.
“China’s annual growth stumbled to less than 60 000 bpd in 2018 from an average 165 000 bpd in the previous four years,” explains ESAI Energy Head of Global NGLs Andrew Reed. “Unless Chinese demand picks up in 2019, global growth will decelerate considerably. In an environment of robust supply, that would result in a tremendous glut. However, we believe Chinese growth will get back to 100 000 bpd next year.”
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