Around 20 VLGCs that discharged LPG in Southeast Asia had to travel around the Cape of Good Hope, a voyage that takes more than 51 days, to return to the US Gulf Coast in July. This followed restrictions at the Panama Canal that caused Neopanamax lock auction prices to reach 2024 highs in mid-May, with reports of an LPG shipper paying $1.9 million.

However, less competition for transit slots pushed auctions back to the initial bidding price of $100,000. Additionally, higher water levels at Gatun Lake allowed the Panama Canal authorities to ease restrictions, and traffic will be expanded from July. This would attract more vessels to the route but will lead to more competition for slots. Propane prices in Mont Belvieu, Texas, increased from 68.125¢/USG to 77¢/USG ($354.93/t to $401.17/t) between 1-12 June, making US product less attractive.

Despite having to ballast back on longer voyages, lack of propane demand kept some VLGC vessels available in the region. The freight rate for a VLGC loading in Houston for a voyage to Chiba, Japan, dropped by 17% to $120/t on 13 June, after reaching a high of $147/t on 31 May. The rate for a VLGC loading from Ras Tanura, Saudi Arabia, to Chiba followed the same trend, dropping to $64/t on 13 June, its lowest since 1 May.

VLGC rates dropping in June