Base oil production in Brazil fell by nearly a fifth in 2020, and output was still off by about that much during the fourth quarter, according to recently released government data. Base oil imports were up for the year, with the largest spikes in volumes occurring early in the second quarter and late in the year.
Brazil’s base oil plants produced 485,000 metric tons of base stocks during 2020, down 18% from 593,000 tons in 2019, according to the government data.
The National Agency of Petroleum, Natural Gas and Biofuels, ANP, reported that In December, the plants – which make primarily API Group I products – produced 45,000 tons of base stocks, 25% less than in the same month in 2019.
The COVID-19 pandemic hit domestic base oil production hardest in the spring. Through the first two months of the year, output was 27% higher than the same period of 2019. March production was down slightly – 8% – but then April, May and June ran behind by 46%-54%.
Output bounced back in July and August, when production was 20%-21% below volumes in the year-earlier periods. July’s volume was Brazil’s second highest last year at 53,000 tons. September’s output of 49,000 tons actually exceeded 2019’s total for the same month by 26%.
For the final quarter of the year production stabilized between 40,000 tons and 45,000 tons per month and 15%-25% less than the corresponding months in 2019.
Before the pandemic struck, Brazil was importing similar amounts of base oil similar to what it produced, but while domestic output dropped during 2020, imports rose. The country imported 766,000 tons of base oil last year, an increase of 12% from 2019. Imported reached 73,000 tons in December, up 7%. Most of the base oil that Brazil imports comes from the United States, and most of that is API Group II. Almost all of the base oil produced domestically is Group I.
ANP’s data showed two huge year-over-year spikes – a 76% increase to 84,000 tons in April, likely reflecting the initial economic impacts of the pandemic, and a 96% jump in November to 129,000 tons. May’s volume was 27% higher at 66,000 tons.
The lowest base import volumes occurred in July, which was down 33% at 36,000 tons and 39,000 tons in January, down 12%.