6.64 million tons of propane and 3.69 million tons of butane, down 0.3% from the previous year
Home Commercial 2% ↓ Transport 12% ↓ Industrial 5% ↑ Petroleum 7% ↑
[이투뉴스] LPG demand, which has continued to increase over the past two years, has turned to a decline. It is regrettable that it showed a rapid growth rate with a double-digit growth rate last year following the single-digit growth rate in 2018.
In particular, concerns are deep as the polarization between industrial and petrochemical, which continued to increase due to a larger decline than last year, for both domestic and transportation, the two main axes of base demand, is intensifying. In the case of transportation, the rate of decline has slowed due to the reflective effect of the abolition of the restriction on fuel for LPG vehicles in 2019.
In addition, as petrochemical applications are still leading the overall demand, polarization by application is sticking, so there is a strong voice that the LPG industry’s mid- to long-term roadmap is urgently needed to expand base demand. The increase in demand for petrochemicals is due to market conditions that have advanced price competitiveness compared to naphtha, an alternative raw material, and is more so in that it is a variable that can change at any time.
According to the 2020 LPG consumption status compiled by the Korea National Oil Corporation, total demand was 10,334,000 tons, down 0.3% from 10362,000 tons last year. This is in contrast to the remarkable growth, recording an increase of 11.3% in the previous year.
Propane was 6.64 million tons, an increase of 6.0% from 6.267,000 tons of the previous year, and butane was 3.694,000 tons, a decrease of 9.8% from the previous year’s 4095,000 tons. This figure is a 16.1 percentage point decrease for propane from the 22.1% increase in the previous year, and 7.8 percentage points for Bhutan from the 2.0% decrease recorded in the previous year.
The increase and decrease by use were similar to last year, while the quantity of goods all decreased from the previous year. For domestic and transportation purposes, the decrease rate increased as the volume decreased significantly, while for petrochemical and industrial applications, the volume decreased, but continued to increase.
By use, in the case of home use, it was 1.64 million tons, down 2.2% from 1.676,000 tons in the previous year. This is a decrease of 1.7 percentage points from the 0.5% decline in the previous year. Propane was 1.55 million tons, a 1.7% decrease from 1577,000 tons in the same period last year, and butane was 89,000 tons, down 10.1% from 99,000 tons in the same period last year.
In the case of propane, it was only 1% in 2019, but recorded an increase from the previous year. Bhutan still showed a high rate of decrease of double digits last year following 2019. As various heating alternatives such as electric heaters increase, it is forecast that demand for cabinet heaters is no longer expected.
Along with domestic commercial use, transportation, which is one of the base demands, is increasingly declining. It was 2678,000 tonnes last year, down 12.2% from 30,51,000 tonnes last year. It is pointed out that it has been comforting that the decline has decreased over the past two years, but if there is no special good news, it is difficult to have expectations.
Petrochemical use, as in the previous year, led the aggregate demand last year. It was 4877,000 tons last year, an increase of 7.1% from 4552,000 tons last year. It is 18.8%p lower than the 25.9% growth rate recorded in the previous year, but it is meaningful in that the increase continued. Among the petrochemical applications, propane was 4.159,000 tons, up 10.2% from 3775,000 tons in the previous year, and butane was 718,000 tons, down 7.6% from 777,000 tons in the previous year.
The industrial industry also continued to increase, although it was lower than the previous year’s growth rate. The demand for propane drastically declined as price competitiveness with competing fuels such as city gas declined in business targeting industries. Industrial demand was 1139,000 tons, an increase of 5.2% from 1083,000 tons last year. Propane was 930,000 tons, an increase of 1.6% from 915,000 tons in the previous year, different from the 17.5% increase rate recorded in the previous year. Butane was 209,000 tons, an increase of 24.4% from the previous year’s 168,000 tons, down 6.0 percentage points from the previous year’s increase rate of 30.4%.
Reporter Chae Je-yong [email protected]
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