November 8, 2019
Volume 7 Issue 8
SSY Base Oil Shipping Report
Certain routes in the United States, Asia and Middle East are showing tangible signs of increased demand, yet there are other routes in those regions that are decidedly flat. Europe has yet to see any real change.
It transpires that the enquiry to ship 30,000-40,000 tons of methanol from Point Lisas, Trinidad and Tobago, to the U.S. Gulf was covered, but using two vessels. At one point, 14,500 tons of methanol was fixed on subjects for less than $20 per metric ton, but those subjects failed. Another competitive rate was reported on 21,000 cubic meters of ethanol from the U.S. Gulf to Cartagena, Colombia, and Barranquilla, Colombia, which went for less than $300,000. A base oil contract has been quoted from Baytown, Texas, to Veracruz, Mexico, for commencement in 2020. The volume to be shipped is 9,000 tons total, whether in a single shipment or three shipments each of 3,000-4,000 tons.
It has been busy again along the route to South America, with several ethanol shipments of 15,000-20,000cbm fixed into Brazil, with a further 5,000-10,000cbm enquiring for the second half of November. Eighteen thousand tons of methanol fixed from Aruba to Paranagua, Brazil, and 3,000 tons of base oils were fixed from Pascagoula, Mississippi, to Rio de Janeiro for a similar figure to last-done. Four thousand to 6,000 tons of caustic from Lake Charles, Louisiana, to Munguba, Brazil, fixed at $400,000.
Two thousand two hundred to 3,000 tons of caustic was noted from the U.S. Gulf to Aratu, Brazil, for end November. Ten thousand tons of paraxylene concluded from Corpus Christi, Texas, to Suape, Brazil. Twenty thousand to 24,000 tons of caustic and ethylene dichloride from the U.S. Gulf to Maceio, Brazil, and Aratu is believed covered. Ten thousand tons of urea ammonia nitrate was seen from Donaldsonville, Texas, to Santos, Brazil, for end November and 10,000cbm of naphtha was heard from the U.S. Gulf to Brazil. Three thousand five hundred to 4,000 tons of base oils were quoted to the west coast of India from Rio de Janeiro.
There has been a great deal of rate-checking across the Atlantic over the past couple of weeks, especially into the Mediterranean for glycols and styrene. Five thousand tons of caustic was quoted from Freeport, Texas, to Rotterdam and 16,000 tons of caustic was noted Point Comfort, Texas, to the Baltic. Ten thousand tons of ethylene dichloride fixed from Freeport to Spain. Three thousand tons of fishoil was noted from Mississippi to Ghent, Belgium, with more mentioned to Esbjerg, Denmark.
Owners are talking about large volumes of cargo being quoted, typically glycols, ethanol, styrene and ethylene dichloride, with both traders and producers looking for space through to the end of the year to Asia. Rates are expected to firm as a consequence. It would appear that a number of requirements that first entered the market last week have still to be covered. More vegetable oil cargoes have been quoted from New Orleans to Korea too. Thirty-eight thousand tons of ETBE from the U.S. Gulf to the Far East finally fixed cleanly for around $43/t. Ten thousand to 20,000 tons methanol was quoted from Aruba to China.
There is still a lot of interest in sending cargoes to India which has caused some outsiders to go on berth. Styrene is an active grade, with traders looking at India and Pakistan options. Five thousand tons of base oils were quoted from Paulsboro, New Jersey, to Hamriyah, United Arab Emirates, and Mumbai, India, for the second half of November or alternatively could look at December loaders. Others have 2,000-4,000 tons of two to three grades of base oils from Houston to Mumbai.
It was a short working-week for many countries, and this was felt in terms of reduced market activity. Many ships are just one voyage away from becoming prompt. Biofuels are certainly not generating as many fixtures as a month ago, although the tally for this week is more promising when compared to last week. The closure of the acrylonitrile plant at Sealsands, England, has seen more movements out of Ventspils, Latvia, and Antwerp-Rotterdam-Amsterdam to compensate. Methanol too has been a bit busier with several spot fixtures from Delfzijl, Netherlands, with further shipments recorded from Rotterdam and Hamina, Finland.
Demand southbound suffered as a result of the various public holidays and national days, and some of the regular carriers have prompt space available. Several caustic shipments were covered, including cargoes to Barcelona, Spain; Genoa, Italy; Livorno, Italy; Palermo, Italy; San Nicolas, Greece; and Marmara, Turkey. Five thousand tons of paraxylene was booked from Rotterdam to Algeciras, Spain. Eight hundred tons of base oils from Rotterdam to Gebze, Turkey, were booked, as were 21,000 tons of base oils from Rotterdam to Valencia, Spain. More base oils were quoted to Alexandria, Egypt. Four thousand tons of acrylonitrile was quoted from Ventspils to Yalova, Turkey, and some aviation gas is believed to have been booked from Tallinn, Estonia, to the Mediterranean.
Several ships are using biodiesel as a way to re-position back to Northwestern Europe. Ten thousand to 15,000 tons of base oils were being worked from Kavkaz, Russia, to Antwerp-Rotterdam-Amsterdam, and traders have been looking at the Baltic as a possible home for 7,000 tons of methanol from Arzew, Algeria. Some caustic was quoted from Lavera, France, to Thames, England, and 6,000 tons of pyrolysis gasoline fixed from Berre, France, to Rostock, Germany. Pyrolysis gas was also booked from Rijeka, Croatia, to Antwerp-Rotterdam-Amsterdam.
A slight improvement in demand has prevented more ships from ending up in prompt positions in the Mediterranean. Three thousand three hundred tons of methyl tertiarybutyl ether from Barcelona to Venice settled at €130,000. Six thousand tons of styrene fixed from Tarragona, Spain, to Turkey through traders. Seven thousand six hundred tons of caustic was booked from Port Said, Egypt, to Haifa, Israel, and Iskenderun, Turkey.
The westbound market has struggled a bit this week. That said, prompt space is scarce. Eighteen thousand tons of reformate fixed from Milazzo, Italy, to the U.S. Gulf fixed at $520,000, a lot lower than a similar shipment just a week ago. Fifteen thousand tons of sulphuric acid has yet to fix from Aviles, Spain, to Coatzacoalcos, Mexico, and another tricky requirement is 15,000 tons of methanol from Marsa, Malta, to the U.S. Gulf. Four thousand tons of benzene concluded from Antwerp-Rotterdam-Amsterdam to Houston in the mid $30s/t and 3,000 tons of benzene from Antwerp-Rotterdam-Amsterdam to Lake Charles is claimed to have achieved $40/t.
More benzene and pyrolysis gasoline has been quoted from the U.K., Antwerp-Rotterdam-Amsterdam and Mediterranean, but has yet to fix. Traders were looking at toluene and xylene from Leixoes, Portugal, and there has been some acetone and MDI from Antwerp-Rotterdam-Amsterdam. Twelve thousand tons of mixed xylenes was quoted from Rotterdam to Montreal, Canada, and 10,000-15,000 tons of base oils were noted from Greece to Aruba.
The route to Asia has not seen the growth in demand that other routes to Asia have enjoyed, but at least space has thinned out a little. Six thousand tons of cumene was booked from Huelva, Spain, to Caojing, China, and 4,000 tons of paraffins were covered from Algeciras to Ningbo, China. Four thousand tons of intermediates were worked from Rotterdam and Le Havre, France, to Singapore and Shanghai, although the quantity may have ended up just shy of 3,000 tons at $110/t. Five thousand to 8,000 tons of base oils were booked from Antwerp, Belgium, to Singapore and Ulsan, South Korea. Five thousand tons of styrene was attempted from Huelva to Ningbo. One thousand tons of nonene from Antwerp-Rotterdam-Amsterdam to China went for around $100/t, and 1,000 tons of butanediol to Jiangyin, China, paid about the same. Small lots of isopropanol, hexamethylene diamine, glycol ethers, epichlorohydrin and oxo-alcohols were noted.
Several ships are on berth for India and the Middle East Gulf with part-cargo space. Traders have been studying methanol and oxo-alcohols out of the Mediterranean, and there have been questions about shipping base oils from Cartagena to Mumbai and Hazira, India. Fourteen thousand to 16,000 tons of caustic was mentioned from Antwerp to Middle East Gulf, along with 5,000 tons of benzene Antwerp-Rotterdam-Amsterdam to Al Jubail, Saudi Arabia.
Demand is still strong in Northeast Asia, but space is tight for the first half of November, keeping rates firm. A few ships are now booked through to December. A multitude of base oil requirements into China have appeared, and there are still numerous requirements for glycols, paraxylene, mixed xylenes, solvent naphtha C9, acetone and phenol. Several enquiries for small parcels of clean petroleum have been seen from Russia and Korea.
It is not as busy southbound as other routes, but there have been cargo possibilities this week, including styrene from Korea to Thailand, base oils from Korea to Thailand and Philippines, toluene from Korea to Vietnam and pyrolysis gasoline and heavy aromatics from Korea to Singapore. Several small clean petroleum cargoes were noted from Korea to Vietnam and to Singapore.
Contract volumes dominate northbound. Spot volumes are thin, especially for larger cargoes, which makes it hard for non-scheduled ships to go on berth. That said, 3,000 tons of tertiary butyl ether from Pasir Gudang, Malaysia, to mid-China was left unfixed, as was 5,000 tons of naphtha from Kemaman, Malaysia, to Japan. It seems to be a busy time for glycerine and fatty alcohols, with various parcels quoted into China. Pyrolysis gas possibilities have been noted from Pasir Gudang, and 21,000 tons base oils were seen from Dumai, Indonesia, to Nantong, China, and Ulsan.
Space looks a bit tight for prompt loading in Southeast Asia since contractual nominations are running well. As the massive aromatics refinery in Brunei starts to ramp up production, spot volumes have been quoted in the market this week. Some base oils have been noted Singapore to Thailand
No changes have been seen on the transpacificroute. Benzene is silent for November, but there is not a great deal of space either. There is not much space around to Europe either, with plenty of biofuels being fixed, as well as small parcels of chemicals. Traders have quoted 6,000 tons of base oils from Ulsan to the U.K. for November.
It has been a busy period in the regional markets. Intra-Middle East Gulf shipments include benzene, caustic, glycols, styrene and methyl tertiarybutyl ether. Glycols, aromatics, sulphuric acid, phosphoric acid pyrolysis gas, methyl tertiarybutyl ether and base oils have been noted from the Red Sea. Base oils have been quoted from Al Ruwais, U.A.E. to Mumbai and there has been some caustic exported from India. Several large cargoes of mixed chemicals have been quoted from the Middle East Gulf to India.
Higher freights have been reported on the eastbound route, with many enquiries seen, covering a whole range of products from India and the Middle East Gulf. Space is tight. Westbound is active with a selection of chemicals parcels noted as well as more canola from Jebel Ali. Twelve thousand tons of base oils were quoted from the Red Sea to West Africa and 6,000 tons of base oils were noted from Ras Laffan, Qatar, to Rotterdam or Hamburg.
This report was originally featured in the November 6 edition of Lube Report Americas.
Adrian Brown, a senior market analyst for chemicals and base oils with SSY Shipbrokers, London, can be reached at firstname.lastname@example.org or +44 12 0750 7507. Information about SSY can be found at www.ssyonline.com. In the Houston office, Steve Rosenthal of SSY's Chemical Tanker Department can be reached directly at +1 (713) 652-2700 and Jordi Maymi in Singapore can be reached at +65 6854-7127.