LPG trade between the United States and China has returned to pre-2025 trade war levels. This return is due to a reduction in supply from the Middle East and the adoption of improved customs strategies by buyers.
US LPG Imports to China
US LPG imports to China reached approximately 630 and 530 thousand barrels per day in July and August 2026, respectively. This figure in July represents an increase from 560 thousand barrels per day in July 2023, and August also exceeded 490 thousand barrels per day from August 2023 and August 2024, setting a seasonal record.
Impacts from Supply Issues in the Middle East
Due to existing tensions in the Strait of Hormuz and Bab-el-Mandeb, North America's share of China's marine LPG imports has significantly increased. This share has risen from less than 20 percent in the first half of 2025 to over 70 percent by May 2026. At the same time, demand for spot cargoes and restrictions in the Panama Canal have increased transit costs, leading many vessels to take longer routes around the Cape.
LPG imports to China are considered a measure of the country's internal balance, but this data cannot accurately specify the timing of purchases. The route from Texas to China has been significantly affected by the costs of passing through the Panama Canal.
New Customs Strategies
There are two methods to delay customs duties, one of which is effective in avoiding the 11 percent duty on US propane. Recent changes in the import economy mean that a larger portion of shipments are actually paying these duties. Customs storage and processing trade covered nearly 9 percent of propane originating from the United States in 2023 and 2024, and this figure is expected to rise to 16 percent in 2025 and 28 percent in the first half of 2026.
The situation in the Panama Canal has improved in September, and transit costs around the Cape are expected to decrease. Additionally, forecasts indicate that the Gatun Lake level will reach 85.3 feet in November, which is better than previous predictions.
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