Feasibility of shipping propylene and pentane
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The company is mainly engaged in the LPG business. It currently has four LPG tankers, three of which have a capacity of 3,700 cubic meters and one has a capacity of 3,200 cubic meters. Its main business is LPG, though it also deals in some propane and butane products. This year, the shipping business has faced unprecedented difficulties, so the owner wants to expand its operations by converting one ship with a capacity of 3,700 cubic meters to transport propylene, and another ship with a capacity of 3,200 cubic meters to transport C5. The business is mainly divided into two types; the first type is to handle only transportation and earn fees based on logistics services ； The second approach is to combine logistics with trade, taking care of everything from purchasing the goods and packing them for transport to delivering them to the dock designated by the factory. Of course, in the initial stage, the focus is on increasing volume of business; the owner also aims to expand the market, but the profits are minimal, almost non-existent. As a newcomer who has just started working (I’m not young anymore, and this is my first time in this industry), I was assigned this challenging task of market research. The boss believes that through this process, I can learn about the products and get familiar with the market, while it also serves as a way to assess a new employee. Of course, the boss’s ultimate goal is to open up this market. It’s been over ten days since I was given this task; I’ve spent time researching and studying relevant materials, and it’s already causing me a lot of stress. The more I look into it, the more I realize that the feasibility of modifying the project (the contents to be installed on the ship) is low, as the market conditions are not favorable. 1. Propylene 1) Propylene is primarily produced by petrochemical companies, which use it for their own needs; therefore, not much of it is available on the market. 2) The end customers are mostly contracted clients, either those who have signed contracts with Sinopec or with other manufacturers. 3) High requirements are placed on ports and docks; many docks are not suitable for this use. 2. C5 1) Pyrolyzed C5 is generally used for further processing. 2) C5 (allylene, isoprene) is used in the production of petroleum resins or rubber. 3) C5 (pentane) is used as a foaming agent. Similar to propylene, the transportation of C5 by water requires high standards from ports and docks, and there are few suitable docks available in China. I’m new to this field and only have a superficial understanding; could any of you experienced professionals provide some information? I would be extremely grateful!
It seems that propylene is produced in large quantities locally; for this product, it’s still necessary to approach individual users and promote it, as well as targeting users located along rivers and coasts
Currently, some manufacturers in Zhejiang maintain ongoing business dealings related to propylene; similarly, several propylene producers in Shandong also have regular business interactions. Therefore, there shouldn’t be any major issues regarding the supply of propylene. A propylene customer in Zhejiang wants us to supply propylene via one ship per month, in quantities of 3,700 cubic meters. Since it is troublesome to clean the ship once it is used to transport other types of goods, they plan to use this ship exclusively for transporting propylene going forward. Therefore, we aim to acquire more downstream customers; at present, it seems that many companies prefer to use the product for their own needs, and work on this is underway.
We welcome more people to participate in the discussions; Haichuan is a platform for happy sharing. When it comes to technical and market-related issues, you might not be able to handle them effectively; it’s better to focus on technical aspects instead. For example, the safety regulations for ships of this type, the transportation requirements for such materials, the requirements for loading and unloading, key points for maintenance, and so on. Market development is the boss’s responsibility – you can’t make decisions in that area
The transportation cost of propylene is extremely high, and few ports are suitable for it, so the prospects are concerning
At present, the entities that need propylene are mainly those that produce acrylic acid and polypropylene, but they all produce and sell it internally
It seems like the gentleman upstairs knows a lot about this market; please feel free to give me more advice. There are many manufacturers that produce and use propylene internally. However, in recent years, a large number of plants for producing propylene via butane dehydrogenation, as well as equipment for producing propylene from coal chemical processes, have been put into operation. These have all been absorbed by the market, indicating that there are still many companies that purchase propylene from external suppliers. Moreover, isn’t the transportation cost of propylene—specifically the cost of land-based tanker transport—significantly higher than that of shipping by sea? If anyone knows, please come and share; let’s pool our ideas.
I only know a little about it; I’m not in this industry. Besides, buying acrylic acid externally isn’t as practical as producing it using a PDH unit of one’s own – the cost of purchasing it from outside is too high
What you say makes sense; I also think it’s very difficult. However, installing the previous setup wasn’t easy either; moreover, there aren’t many suitable ports in China. Dongying is one I’m aware of, and it is said that queues often form there as well.
The design pressures of propylene tanks and liquefied gas tanks differ significantly