The only route that is experiencing a reasonable degree of demand is the transatlantic eastbound market. Styrene is the hot commodity, and several 10,000 ton cargoes have been booked into both Northwest Europe and the Mediterranean. Rates are said to have been done in the upper $40s/t to Antwerp-Rotterdam-Amsterdam, although some owners contend that over $50/t has been done too, but this has still to be clarified. Strip away the styrene however and all that is left is bits of ethanol, biodiesel, phenol and some acetates.

U.S. Gulf-to-Asia has come to a bit of a standstill. Asian aromatics pricing is generally cheaper than U.S. material, and so the backbone of the route has been hacked out. There is some styrene potentially, but in reality little will probably be moved because Europe is an easier sell. Ethanol, ACN, phenol and specialist grades are about the only other commodities moving, although there were reports of 14,000 tons of vegetable oil being fixed from New Orleans to Korea at $60/t, which is not a shabby rate for the owner.

Base oils are not really happening out of the U.S., in spite of good availability and competitive pricing. U.S. Gulf-to-India and the Middle East Gulf has seen some base oil demand but not really as much as some would have expected. U.S. Gulf to the east coast of South America has seen a little demand for base oils, but the main products seem to be styrene, caustic and paraxylene these days.

U.S. Gulf to the Caribbean is generally quiet right now. With the exception of the transatlantic route, rates have not really changed much at all this week in the U.S. Gulf.

Europe

The coastal markets have been very dispiriting all round. The North Sea and Baltic areas are probably a little happier now that the clean petroleum markets have started to become busier, but in terms of chemical demand things have been very flat. Biodiesel has perhaps been the biggest thing in the region, but freight rates for biodiesel are not really giving the kind of return on investment that chemical tanker ship owners need.

Southbound into the Med has seen some aggressive offers by ship owners for almost any kind of cargo. Put simply, there are too many open vessels in the area, and since demand for space is currently so weak only the most competitive of freight levels will stand a chance of picking off a cargo. Biodiesel again has to be at the forefront, with rates down into the mid 20s/t for larger lots into the West Med. Due to plant issues, Italy is buying up quite a lot of benzene at the moment, and several cargoes are being supplied from Northwest Europe. Rates for 5,000 ton parcels into the Adriatic are barely above $50/t.

Northbound is not busy either, and ships are sailing with open space. Demand is comprised primarily of biodiesel, pygas, gasoline components and some methanol and acetic acid.

Of all the European routes, the inter-Mediterranean market must rank as the slowest of them all, and it is common to find ships waiting for 10 days or more for their next employment. In most cases, they have to cover the cost of ballasting from where they have discharged back to a loading area. In such conditions, rates are very weak, although at least bunker costs have continued to decline which makes the pain a little easier to bear.

Transatlantic westbound has been the real star this week. Aromatics, such as pygas, mixed xylenes, toluene and orthoxylene, have popped up. There has been more caustic, UAN and sulphuric acid. Some small parcels of base oil have been booked. There has even been a requirement to ship 10,000 tons of biodiesel from Hamburg to New York, which is a reversal of the usual routing for biodiesel. Rates have firmed slightly and 5,000 ton parcels from Rotterdam to Houston are in the mid-to-high $40s/t.

Europe to Asia however is still very dull with hardly any interest in larger cargoes. Aromatics remain off the radar, and instead things like molasses are being fixed. Rates remain notionally in the low-to-mid $70s/t for 5,000 ton parcels from Rotterdam to Korea. Base oils are being investigated from the Med, and also into the India-Middle East Gulf region.

Asia

As businesses in China restarted work after the week-long National Day holiday, it could have been expected that shipping demand would accelerate, but as it happened many buyers chose to wait a while before reordering, with the result that the domestic Asia region had a relatively calm week. Ship owners have mostly succeeded in fixing their ships for October, but could use a bit more activity to lift them into the mid November period. Rates are generally settled in the region.

Asia export markets are still recording some sizzling deals as buyers in Europe especially import cheaper-priced commodities from Asia. For instance, 15,000 tons of acetic acid recorded rates in the low $100s/t, while aromatics were heard done around $116/t for 5,000 to 6,000 ton shipments to Rotterdam. Benzene has been seen to the U.S., along with products such as biodiesel and UAN, although rates are generally unchanged.

Palm oil markets see very little new business to India, but Chinese demand is picking up.

In the Middle East Gulf-India region, space is pretty scarce westbound, and rates in the $70s and $80s/t are being done for 5,000 to 10,000 ton parcels. Eastbound however is more sedate and rates have not moved. Indeed, there looks to be more tonnage making its way into the region, and this may bring pressure to bear on rates shortly.

Adrian Brown is senior market analyst for chemicals and base oils with SSY Shipbrokers, London. Information about SSY can be found at www.ssyonline.com. Adrian Brown, in the U.K., can be reached at fix@ssychems.com or by phone at +44 1207-507507. In the London office SSYs Panos Giannoulis can be reached at fix@ssychems.com or +44 20 7977 7538 and in Singapore Jordi Maymi at +65 6854 7127.