July 23, 2019
Volume 3 Issue 8
SSY Base Oil Shipping Report
U.S. markets look fairly robust for the rest of July. Europe also seems as though it will get through the next couple of weeks without too much difficulty. Asia is not exactly busy, but owners are finding cargoes and there are clearly fewer prompt positions than before.
There seems to be some space around on scheduled carriers along the Caribbean route, seemingly because of a lack of ullage in storage tanks that is causing some regular movements to be deferred. There is not a great deal of outsider space around in the U.S. Gulf during this period however. Tropical Storm Barry will almost certainly cause disruption to both ship schedules and cargo planning this week.
A tender is out to supply Kingston with 6,000 tons to 8,500 tons of ethanol for end of July delivery. Twenty-three thousand tons to 25,000 tons of methanol was quoted from Point Lisas, Trinidad and Tobago, to the east coast of Canada and the U.S. Atlantic Coast. Nine thousand tons of renewable diesel appears to have fixed from New Orleans, Louisiana, to Montreal, but it remains to be seen if the cargo will go or not.
Ethanol continues to be moved southbound, with cargoes noted to both Brazil and also to Barranquilla, Colombia, and Buenaventura, Colombia. Caustic too has seen some action into Brazil, and a parcel of glycol was quoted into Campana, Argentina. Five thousand tons of styrene was noted from the U.S. Gulf to Santos, Brazil, and 5,000 tons of urea ammonia nitrate was also seen from Mississippi to Santos. A large slug of base oil is looking to go down to Brazil and Argentina.
Around 20,000 tons to 22,000 tons of caustic and ethylene dichloride is believed to have fixed from the Texas Gulf to Maceio, Brazil, and Aratu, Brazil, in the mid $40s per metric ton.
Along the transatlantic route, styrene is still seen from the U.S. Gulf to Antwerp-Rotterdam-Amsterdam, although it remains to be seen how many stems will be left once the cargoes to India and Asia have been worked. Ethanol is still under discussion from the U.S. Gulf to Antwerp-Rotterdam-Amsterdam for July in 10,000 cubic meters to 12,000cbm quantities, and methanol too is understood to be shipping to Europe in sizeable quantities.
Traders are looking at 3,000 tons to 5,000 tons of chemicals from Port Arthur, Texas, or Port Neches, Texas, to Antwerp-Rotterdam-Amsterdam. Several parcels of used cooking oil are understood to have been fixed from the U.S. Atlantic Coast to the United Kingdom, with usual levels paid. Traders are looking at glycols into Italy and Turkey, and there are possibilities to take styrene to Turkey too.
Many traders are looking at sending styrene out to Asia. Space is under pressure and will remain so until owners have a better understanding of how much space will be left to them in August. Rates have apparently been done in the low $60s/t for 5,000-ton cargoes, with perhaps one or two lots in the upper $50s/t. Several ethanol requirements have been noted from the U.S. Gulf, Cuba and Brazil, with one further cargo loaded from the west coast of the U.S. Ten thousand tons of ethylene dichloride was quoted from Point Comfort, Texas, to Map Ta Phut, Thailand, but is said to be more of a rate check than a firm requirement.
Styrene has seen heavy interest into India from traders. Ethanol too is receiving attention into India. Twelve thousand tons to 16,000 tons of base oils from Paulsboro, New Jersey, to the west coast of India has been pushed again for the end of July, but that enquiry seems spurious since the cargo has been sold elsewhere, with a vessel currently alongside loading.
Even though the market in the North Sea and Baltic has been slow during July, it seems like most of the owners who reported open positions mid-July have managed to fill up the space. Right now, there are a few prompt positions, but most vessels will be open only at the end of July and a few have managed to book through to the beginning of August.
Quite a few urea ammonia nitrate fixtures and enquiries have been noted this week, while biodiesel, ethanol and other gasoline components such as methyl tertiarybutyl ether and ETBE have also been fairly active. Four thousand tons of pyrolysis gasoline fixed from Riga, Latvia, to Antwerp-Rotterdam-Amsterdam, and pyrolysis gasoline is being attempted from Liepaja, Latvia. Some base oils have been booked from Riga to the west coast of the U.K.
A fair number of cargoes have been quoted southbound this week, but not all have materialized so far. These include many biodiesel shipments, ranging in size from 6,500 tons to 12,000 tons, primarily into Spain, France and Italy. Requirements for caustic and ethylene dichloride have also been quite common. Six thousand three hundred tons of base oils were noted from Fawley, U.K., to Vado, Italy, and a small shipment of acrylonitrile to Porto Torres, Italy, from Rotterdam was interesting as the cargo has previously been supplied from other sources. Space is not exactly tight since there are still owners showing prompt positions and other vessels are open towards the end of July.
The market seems quite steady northbound. There is nothing hugely exciting, but there is a regular flow of biodiesel heading north out of Spain. Two thousand tons of pyrolysis gasoline fixed from Marghera, Italy, to Antwerp-Rotterdam-Amsterdam and another shipment of pyrolysis gasoline was covered from Berre, France, to Terneuzen, Netherlands. Four thousand tons of caustic was booked from Lavera, France, to Santander, Spain, and 4,000 tons of heavy aromatics are being loaded in Leixoes, Portugal, for Antwerp, Belgium. Traders have been nosing around some potential aromatics from the Central Mediterranean and Black Sea to Antwerp-Rotterdam-Amsterdam, and 4,000 tons to 6,000 tons of base oils were noted from Kavkaz, Russia, to the U.K.
There are a couple of ships into the Mediterranean that are open in fairly prompt positions, but the majority of vessels have got themselves at least one week’s employment in hand, and quite a few are covered up until end July, proving that the summer period is not always totally flat. Biodiesel of course is responsible for the major share of all spot business in this area, but the voyages combine well and often with little or no ballast legs, with minimal cleaning required afterwards.
Base oils have been booked from Kavkaz, Russia, to Gebze, Turkey, and several small parcels were booked to Haifa, Israel, and Ashdod, Israel. Five thousand tons of benzene was quoted from Chornomorsk, Ukraine, to Venice, Italy, and 5,000 tons to 6,000 tons of methanol was noted from Arzew, Algeria, to Trieste, Italy.
Interest in aromatics westbound has intensified this week, particularly with benzene, but also with pyrolysis gasoline, paraxylene and toluene, and this has led to a couple of outsiders being able to go on berth and take advantage of the lack of prompt space. More sulphuric acid has seemingly been booked for later in July. Aniline continues to be quoted across from Antwerp-Rotterdam-Amsterdam. Four thousand tons of glycerine from Ghent, Belgium, to Albany, New York, was an interesting quotation.
Contractual volumes to the Far East are looking better for the end of July and early August positions, leaving less space among the scheduled carriers than there was at the end of June and early July. Styrene from Continental Europe and from Spain has helped put a few extra vessels on berth but finding completion cargoes is difficult. A large cargo of base oils is reported to have fixed from Kavkaz, Russia, to Singapore.
There seems to be no shortage of outsiders willing to go on berth to India and the Middle East Gufl. Finding a base cargo is in some ways the easy part but securing completion cargoes is where it becomes tricky. A rash of base oil enquiries appeared from Kavkaz, Russia, out to India and the Middle East Gulf, and more phosphoric acid was pushed around Tunisia to Kakinada, India. Fifteen thousand tons of mixed xylenes from Rotterdam to the west coast of India was rather interesting, while an enquiry for 5,000 tons of toluene from Rotterdam to Al Jubail, Saudi Arabia, was quite astonishing.
Business seems to have picked up in general throughout Asia. Nothing startling, but more vessels than before are fixed through to the end of July and quite a few now only show August dates. Contractual business undoubtedly acts as the backbone, with perhaps a few more spot opportunities to help pad out the program.
Benzene continues to be quoted on the transpacific route, with some traders even seeking July space, which seems to be a tricky proposition. Even August space is pretty limited unless owners bring more tonnage on berth. Cargoes of toluene and paraxylene have also been discussed to the U.S. Gulf. There seems to be fewer large cargo possibilities on the routes to Europe, meaning that owners are having to consider going down the parcels route, and several ships seem to be so engaged.
In general, the used cooking oil and biodiesel sector is not as busy either, with all of the first half of July cargoes now covered. Ten thousand tons of biodiesel however is said to have fixed from Port Klang, Malaysia, and Lahad Datu, Malaysia, to Antwerp-Rotterdam-Amsterdam for mid-July loading. Several traders participated in a tender to send benzene from Map Ta Phut, Thailand, to Europe, but the arbitrage does not seem to support such a move and the cargo will likely ship to China instead. Four thousand tons of base oils fixed from Malacca, Malaysia, to Genoa, Italy, at $87/t.
Space seems to be a little tighter in the regional market this week, while several small parcels have been quoted. Base oils are active out of the Red Sea, and 13,000 tons of base oils from Al Ruwais, United Arab Emirates, to Port Khalid, United Arab Emirates, were covered. A small parcel of base oils is also believed to have fixed from Karachi, Pakistan, to the west coast of India. Benzene is active back into the Middle East Gulf from India and Sohar, Oman. Eastbound is not particularly busy, and space can be secured on the regular callers. Westbound is stable.
This report was originally featured in the July 17 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.