In early November, domestic LNG ex-works prices were lower than spot import costs, with sellers showing strong intentions to halt price declines. However, high inventory levels and weak demand limited price support. Looking ahead to late November, the heating season in northern regions, especially with the arrival of cold spells, may temporarily boost short-term demand and drive up nationwide LNG prices. While Guangdong's LNG ex-works prices might see slight upward movement due to high spot DES price, sufficient supply from tier-2/3 importers is expected to maintain local market weakness.

Guangdong LNG Market Continues October Decline in Early November. Guangdong's natural gas supply mainly comes from imported LNG, and its market prices fluctuate closely in line with import costs. In November, after a drop, spot LNG DES prices rose slightly, remaining around $12/MMBtu. Although sellers strongly resist further price drops, ample supply has alleviated concerns over shortages, resulting in weak price support in the market.

According to SCI, as of November 12, the average ex-works price of LNG in Guangdong was RMB 4,825/mt, down by RMB 200/mt from RMB 5,025/mt at the end of October, continuing the downward trend.

Looking back at the October market, after a brief recovery post-holiday, LNG arrivals in late October were dense, with increased competition due to the arrival of tier-2/3 resources. Only transportation demand supported the market, causing prices to fluctuate downwards. In early November, with dense arrivals and ample supply, receiving terminals lowered prices to ease inventory pressure, continuing the downward trajectory from October.

In early November, Guangdong's LNG market continued its downward trend. This was due to two factors. Firstly, dense LNG vessel arrivals and fierce competition among sellers, coupled with high inventory pressure, led to continuous price reductions. Secondly, weak downstream demand made it difficult to support prices.

According to SCI, as of November 12, the daily truck loading volume at Guangdong terminals was 7,700 tons, a 4.79% decrease from the October monthly average.

On the demand side, the price advantage of LNG from Sichuan has led to a shrinking sales radius for seaborne LNG. Market surveys show that from late October, weak demand limited price support, while plants’ operating rates remained stable. As a result, Sichuan LNG prices continued to drop, even below RMB 4,000/mt, giving it a price advantage in South and Central China. Despite strong international LNG prices, coastal end-users resist high prices. In this over supply scenario, LNG prices in South China are expected to remain weak in late November.