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China's Ethane Dependence Deepens as Panama Canal Risks Grow, Vortexa Says

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China's share of global seaborne ethane imports reached 74% in July, highlighting growing concentration in a trade dominated by US supply and increasingly reliant on the Panama Canal, Vortexa analyst Zhuoyi Liu said in a Friday note.

Global seaborne ethane imports averaged about 760,000 barrels per day in July, with China taking about 560,000 b/d.

On a rolling 12-month basis, China's share rose to about 70% at end-July, from 58% a year earlier and 46% in 2022.

The US accounted for about 99% of global seaborne ethane exports in January-July, averaging roughly 670,000 b/d.

Almost all shipments originated from four terminals, Enterprise Product Partners' (EPD) Morgan's Point and Neches River, and Energy Transfer's (ET) Nederland and Marcus Hook.

Flexible terminals can switch between ethane and LPG depending on economics.

In April, ethane's share of combined NGL sendout at three such terminals fell to about 20% from 32% in March as stronger LPG demand redirected capacity.

China's import infrastructure is also becoming more concentrated, although new terminals are adding diversity.

Zhejiang Satellite's Lianyungang terminal handled about 215,000 b/d in January-July, or 45% of Chinese imports, while Wanhua's Yantai terminal took about 100,000 b/d.

Yantai volumes nearly tripled from 2025 as its No. 1 cracker shifted from propane to ethane.

A new Nangang terminal serving Sinopec's Tianjin ethylene project also received about 36,000 b/d.

The concentration creates vulnerabilities. About 90% of 98 laden US-to-China ethane voyages in January-July transited the Panama Canal.

Canal disruptions in 2023-24 and again in April 2026 forced some vessels to reroute around the Cape of Good Hope, contributing to weaker Chinese arrivals.

China's dependence is likely to deepen before INEOS Project ONE in Antwerp starts operations in the second half of 2027. The project is designed to consume about 90,000 b/d of ethane.

Meanwhile, the Panama risk could rise with weather conditions.

National Oceanic and Atmospheric Administration forecasts an 81% probability of a very strong El Nino in October-December 2026, while Gatun Lake levels are expected to decline through autumn.

Price: $38.34, Change: $-0.56, Percent Change: -1.45%

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