August 20, 2019
Volume 3 Issue 3
SSY Base Oil Shipping Report
U.S. markets are still reasonably active for the time of year. European coastal markets have picked up after a slow start to the month, and August space has tightened out in Asia too.
Cargo volumes remain fairly strong along the Caribbean route, to the extent that there is not a great deal of surplus space around. A prompt lifting of 3,000 tons of glycols from the U.S. Gulf to the east coast of Mexico had to be spot-fixed when the contractual carrier rate late, and the cargo is understood to have gone on subjects at high levels.
Eight thousand five hundred tons of ethanol fixed from Texas City, Texas, to Kingston, Jamaica, and Montego Bay, Jamaica. Discussions about shipping methanol from Venezuela for the end of August seem to have been shelved amid talk of the trade embargo being enforced. Methanol continues to ship from Trinidad however.
The scheduled carriers on the South America route are fairly tight on space, contractual demand being quite heavy this month. Four thousand four hundred tons of base oils were quoted from Houston, Texas, to Santos, Brazil, and are believed to have been covered at $68.50 per metric ton. Eight thousand eight hundred tons of base oils from the U.S. Gulf to Rio de Janeiro were also seemingly covered.
Traders have been discussing possible styrene shipments into Brazil. A tender to purchase 1,000-1,500 tons of monoethylene glycol was circulated by buyers in Campana, Argentina, and provoked several shipping enquiries from the U.S. Gulf. More ethanol looks to have been fixed into Brazil off mid-August, and a cargo of urea ammonia nitrate is understood to have been booked from Mississippi to Brazil and Argentina. Methanol has been fixed from Jose, Venezuela, to Brazil for the first half of August.
It has been fairly busy again across the Atlantic. Traders were probing to see if benzene could be worked eastbound. Others are looking at 3,000-5,000 tons of ethylbenzene from Carville, Louisiana, to Gonfreville, France, or Antwerp-Rotterdam-Amsterdam. Ethanol was booked into the United Kingdom, and 6,500 tons of caustic is suspected of having fixed from the U.S. Gulf to Kotka, Finland.
Some vinyl acetate monomer was circulated from Houston, Texas, to Antwerp, Belgium. Five thousand tons of styrene seemingly fixed from Braithwaite, Louisiana, to Antwerp-Rotterdam-Amsterdam. Others are quoting 5,000 tons of styrene from Houston to Antwerp-Rotterdam-Amsterdam for mid-August. Nine thousand tons of caustic was quoted from Point Comfort, Texas, to Ravenna, Italy, and 20,000 tons of caustic was attempted from the U.S. Gulf to Durban, South Africa.
Glycols are very active, with several requirements noted to Antwerp-Rotterdam-Amsterdam, with more tons quoted into Spain and Turkey. Styrene continues to be studied into Turkey, while 10,000 tons of ethylene dichloride was seen from the U.S. Gulf to Barcelona, Spain. Eighteen thousand tons of sulphuric acid looks to have fixed from Belledune, Canada, and Valleyfield, Canada, to Jorf Lasfar, Morocco.
Six thousand tons of fishoil was heard from New Orleans, Louisiana, to Esbjerg, Denmark. Six thousand tons of vegetable oil was spotted from New Orleans to Casablanca, Morocco, with further palm oil shipments noted to Rotterdam and also into the Mediterranean from the Caribbean. A cargo of base oils is loading from Houston to Lagos, Nigeria, allegedly for mid $70s/t.
It has been a slow week to Asia, with most cargoes confined to large lots of methanol or ethanol. Twenty-eight thousand five hundred tons of tallow and used cooking oil from Houston, Texas, to Singapore is believed to have gone for just under $60/t. Interestingly, 9,000 tons of glycols were quoted from the U.S. Gulf to the Far East for the second half of September, and 10,000-15,000 tons of acrylonitrile was heard circulated from the U.S. Gulf to the Far East for the second half of August.
Traders continue to fish for rates for 5,000-10,000 tons lots of styrene from the U.S. Gulf to the west coast of India, and the same for ethylene dichloride, but nothing seems to have come to fruition so far. Six thousand cubic meters of ethanol was quoted from the U.S. Gulf to Mombasa, Kenya, for the end of August or early September.
The North Sea and Baltic market has shrugged off the apparition of the summer lull and owners are reporting that most ships are again having employment in hand that will last them a week in many cases and for some vessels even longer than that. Skimming through the fixtures and enquiries shows that biodiesel and ethanol are among the most active grades. Rates have not been stellar, with owners seemingly content to have employment rather than haggling over rates. Six thousand tons of C7 from Dunkirk, France, to Antwerp-Rotterdam-Amsterdam paid $100,000, for example, compared to around €90,000 previously.
Cargo volumes southbound were a bit stronger this week, halting the slide in rates. Fourteen thousand tons of methyl tertiarybutyl ether from Rotterdam, Netherlands, to the Mediterranean is still being circulated for prompt loading. Two thousand seven hundred tons of glycerine fixed from Bordeaux, France, to Turkey, and 3,000 tons of acrylonitrile from Ventspils, Latvia, to Marmara, Turkey, was noted.
Several shipments of ethyl acetate were covered from Saltend, England, to Marmara on different carriers. It has become quite fashionable to fix caustic from Continental Europe into the Mediterranean using larger ships that would otherwise be idle, and this week saw several such movements. Caustic continues to fix into Spain in smaller quantities, and 3,500 tons of caustic potash was quoted from Antwerp to Seville, Spain, and Bilbao, Spain.
The market has been fairly lively, tightening space availability. Several cargoes of toluene are being attempted from Italy. Five thousand tons of pyrolysis gasoline from the West Mediterranean to Antwerp, Belgium, fixed at around €145,000 for loading early August, yet a similar requirement for loading mid-month saw levels of €200,000.
Twelve thousand tons of FAME fixed from Huelva, Spain, to Milford Haven, Wales. Two thousand tons of base oils were heard to have gone from Augusta, Sicily, to Rotterdam, seemingly for under $150,000. Cargoes of wax, pyrolysis gasoline, alkylates and benzene have been discussed and 3,000 tons of base oils were noted from Cartagena, Spain, to La Rochelle, France.
A surge in demand between the Mediterranean has swept away most of the prompt positions that were around at the start of the month, and at reasonably strong levels. Five thousand tons of ETBE to methyl tertiarybutyl ether from Fos, France, to Taranto, Italy, and Venice, Italy, settled at €165,000 while 5,000 tons from Malta to Rijeka, Croatia, cost €120,000.
Five thousand tons of easy chemicals from 2-Black Sea to Venice fixed at $230,000. Three thousand tons of base oils fixed from Livorno, Italy, to Alexandria, Egypt, but 3,500 tons of base oils from Livorno to Mohammedia, Morocco, remain uncovered. With lengthy public holidays taking place this week, the markets are expected to quieten down again.
It has been very calm westbound, and 14,000 tons of reformate is again being studied from Taranto, Italy, to the U.S., but traders also wish to explore other discharge possibilities. The pyrolysis gasoline from Sines, Portugal, and Berre, France, was booked to Continental Europe instead of to the U.S. Gulf, as expected. Traders continue to evaluate freights for 8,000-ton parcels of base oils from the Mediterranean to the Caribbean. Two thousand eight hundred tons of chemicals from Fawley, U.K., to Bayonne, France, achieved just under $120/t.
Owners are having difficulty in filling their ships from Europe to the Far East and several have dropped down into the Red Sea to complete with cargoes such as 10,000 tons of monoethylene glycol from Yanbu, Saudi Arabia, to Taicang, China. Seven thousand tons of styrene concluded from Gonfreville, France, to China, with others also studying styrene for August. One thousand tons of monopropylene glycol was booked from Rotterdam, Netherlands, to Kaohsiung, Taiwan, and 3,700 tons of chemicals from Rotterdam to 3-Far East went for $119/t.
Two thousand tons of butanediol was quoted from Rotterdam to Dongnai, Vietnam, and 2,000 tons of 2-ethylhexanol was seen from Lavera, France, to Taiwan or China. A couple of acetone parcels are understood to have been fixed, and interestingly, smaller parcels of vegetable oil have been noted to China from Rotterdam.
A large parcel of base oil fixed out of the Baltic along the India and Middle East Gulf route, and some phosphoric acid is looking to achieve levels in the low- to mid-$30s/t to Sikka, India, from Tunisia, but most cargo requirements have been small. Isopropanol has generated some interest, and several small lots of linear alkyl benzene have been seen. Three thousand six hundred tons of hexane concluded from Constanza, Romania, to India. One thousand one hundred and fifty tons of base oils were quoted to Fujairah, United Arab Emirates, from Continental Europe.
The amount of open space has reduced substantially into Northeast Asia, with many vessels fixed through to the end of the month. A series of typhoons has caused port closures in the area and the knock-on delays will invariably impact on the tonnage availability situation. Phenol continues to be quoted from Yosu, South Korea, to China, and various parcels of mixed xylenes and toluene have been seen Korea to Taiwan.
Three thousand two hundred tons of base oils were quoted from Negishi, Japan, and Mizushima, Japan, to Lanshan, China, and Tianjin, China, and 5,700cbm of motor gas was pushed around Onsan, South Korea, to Nagoya, Japn.
Spot demand southbound remains subdued. A couple of Chinese sulphuric acid cargoes have apparently been traded into Southeast Asia, but caustic has been slow.
Both contractual and spot demand northbound appear active. Two shipments each of 6,000 tons of unconverted oil were quoted from Bangkok to Ulsan, South Korea, and some normal paraffins were heard enquiring from Malaysia to China. The economics of shipping mixed aromatics into China are supposedly looking better, which has spurred some small enquiries from Southeast Asia.
Eight thousand five hundred tons of pyrolysis gasoline was quoted from Map Ta Phut, Thailand, to Korea or China and 2,500-2,700 tons of crude benzene was seen from Vietnam to Taiwan. Parcels of fatty alcohol were booked and some paraxylene was noted from Singapore to Zhuhai, China, off prompt dates to replace a delayed contractual shipment.
Several smaller vessels are open in prompt positions to Southeast Asia, but the rest of the fleet looks to have taken advantage of the pre-holiday rush as charterers covered their outstanding requirements beforehand. Discussions continue about palm methyl ester into China, and several pyrolysis gasoline possibilities have been noted.
Four thousand five hundred tons of 2-ethylhexanol was seen from Gresik, Indonesia, to south China and 2,000 tons of toluene was heard from Sri Racha, Thailand to Vietnam. Four thousand tons of soy bean oil from Phu My, Vietnam, to Pasir Gudang, Malaysia, was an interesting quotation.
August space has just about all gone on the Transpacific route, with talk of some large benzene fixtures to the U.S. Gulf. Twenty thousand tons of base oils were spotted from Ulsan, South Korea, to Houston, Texas, but needed arrival in Houston before Sept. 20. One thousand tons of dowanol was noted from Ulsan to Texas City, Texas.
Owners say that the market to Europe is busy, with many small parcels quoted from Korea and China into the Mediterranean and Antwerp-Rotterdam-Amsterdam, as well as cargoes of vinyl acetate monomer from Singapore to Antwerp-Rotterdam-Amsterdam and Egypt. In addition, there have been lots of biodiesel quotations from China, but all for loading around the same time. August space is tight, and owners are bullish on freight ideas.
Tensions remain high in the regional market. Increases in AWRI and concerns over sending ships into the region have tightened space and will probably cause rates to strengthen. Eastbound faces the same issues, except that owners are now more interested in cargoes out of India and the Red Sea which could ultimately weaken those freights. Fifteen thousand tons of base oils from Yanbu, Saudi Arabia, and Jeddah, Saudi Arabia, to Mumbai, India, and Chennai, India, were reportedly fixed in the mid $30s/t for example.
Westbound sees greater interest by traders in sending benzene to Europe and paraxylene to the U.S., Mexico and the Mediterranean. Fifteen thousand tons of easy chemicals from the Middle East Gulf to the Mediterranean seemingly went in the high $40s/t. Traders are looking at sending caustic to either Ravenna, Italy, or Durban, South Africa, from India, and 19,000 tons of sulphuric acid was seen from Dahej, India, to Morocco.
This report was originally featured in the August 14 edition of Lube Report Americas.
Adrian Brown, a senior market analyst for chemicals and base oils with SSY Shipbrokers, London, can be reached at email@example.com 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.