The markets are still very disjointed. Some routes have been rather slow this week, even in the Americas and Asia, but equally there have been routes in all three main regions in which activity has improved.
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Tonnage seems to be reasonably well-employed on a prompt basis to the Caribbean. A methanol contract has been quoted from Point Lisas, Trinidad and Tobago, to the U.S. Atlantic Coast or U.S. Gulf for volumes between 10,000 tons and 25,000 tons. A further fixture of 13,000 tons ethanol appears to have been accomplished from the U.S. Gulf to Colombia. A small parcel of base oils was quoted into Rio Haina, Dominican Republic, for December loading.
It has been a slower week on the spot market along the South America route. Most of the caustic requirements to Brazil came to nothing, and the same seems to be the case for the ethanol possibilities to Brazil. Ten thousand tons of urea ammonia nitrate was evidently booked from Donaldsonville, Louisiana, to Santos, Brazil, for end November loading, whereas a larger lot of urea ammonia nitrate to Argentina for December is said to have been withdrawn without fixing. It transpires that 18,000 tons of sulphuric acid shipped from Belledune, Canada, to Paranagua, Brazil.
There has been a considerable amount of cargo quoted this week along the transatlantic route, but it remains to be seen how much of it actually firms up. Some of it has been around already a fair length of time, but keeps popping back with new dates, such as a very large enquiry of ethanol from Mississippi to the Baltic and several of the styrene and glycol possibilities into Turkey and Antwerp-Rotterdam-Amsterdam. A cargo of metaxylene was heard fixed into Algeciras, Spain, and 4,000 tons of green diesel was spotted from New Orleans to the Adriatic.
Twenty thousand tons caustic is looking for a ship from the U.S. Gulf to Conakry, Guinea, and it is believed the 20,000-24,000 tons enquiry of caustic from Point Comfort, Texas, to Durban, South Africa, has yet to be booked. Three thousand five hundred to 4,000 tons of biodiesel from Grays Harbor, Washington, to Antwerp-Rotterdam-Amsterdam was an interesting quotation. A small parcel of JP8 was seen from Seabrook, Texas, to Immingham, England. Three thousand tons of 2-ethylhexanol from the U.S. Gulf to Marmara, Turkey, allegedly achieved $70 per metric ton.
Glycol is the flavor of the month, with many enquiries to Asia noted. Ten thousand tons of glycol from Lake Charles, Louisiana, to Xiamen, China, for November loading is understood to have brought an outsider on berth. Space among the regular callers is however scarce, and freights are nudging upwards. Some of the ethanol requirements that were around for November have been deferred into December. Ten thousand tons of ethylene dichloride from the U.S. Gulf to Mainport Far East has not been booked so far, nor has 10,000 tons of vegetable oil from Norfolk, Virginia, to South Korea.
Space is tight, and another outsider has gone on berth with 10,000 tons of glycol and 5,000 tons of styrene to India. Another outsider is picking up a very large quantity of base oils from Port Arthur, Texas, to Mumbai, India, and Hamriyah, U.A.E., but it would seem not to be the Paulsboro, New Jersey, base oil stem as that is still being quoted to Hamriyah and Mumbai. Further parcels of styrene and glycol are being quoted from the U.S. Gulf to India and Pakistan for November.
In general, owners are disappointed that the market is not providing the customary volume of cargo that would normally be seen in early November in the North Sea and Baltic. Despite this, the tonnage lists reveal that ships have managed to pick up a bit more business this week. Biofuels have improved considerably, as have the urea ammonia nitrate trades. Shipments of methanol, aromatics, edibles and chlor-alkali have lent support too. Base oils have been booked into Riga, Latvia, and out from Riga and Kaliningrad, Russia, this week.
An abundance of Mediterranean-based vessels has swamped the southbound route, and since demand remains lukewarm rates are currently rather weak. Biodiesel is perhaps the most prolific of commodities, followed to a lesser extent by edibles, caustic, ethylene dichloride, base oils, urea ammonia nitrate, APP, ethanol, styrene, acrylonitrile, glycerine and aromatics.
The northbound route feels stable, with supply to demand of tankers well matched. Rates appear firmer as owners seek to cover the additional costs of using compliant fuel, with perhaps 2-3/t being added to typical levels for routine business. Two thousand five hundred tons of base oils were booked from Augusta, Sicily, to Rotterdam and 3,000 tons of base oils were fixed from Cartagena, Spain, to Antwerp, Belgium. A tender for 2,600 tons of pyrolysis gasoline from Augusta sees traders looking to send the cargo to Antwerp-Rotterdam-Amsterdam, or the U.S. Gulf. Four thousand five hundred tons of isomerate from Tarragona, Spain, to La Coruna, Spain, achieved a little under 30/t. Several clean petroleum cargoes in the 10,000-15,000 tons size have been attempted from the Mediterranean to the United Kingdom. Six thousand tons of caustic was booked from Lavera, France, to Sweden, and another 4,000 tons of caustic was done from Lavera to Thames, England. Three thousand tons of aromatics from southern Spain to Antwerp-Rotterdam-Amsterdam obtained levels of $50/t.
Owners in the Mediterranean are aiming for higher numbers, citing the extra cost of compliant bunkers. Most owners have expressed their intention to use marine gas oil, with only a few electing to experiment with very-low sulfur fuel oil. Freights have responded upwards, helped by stronger demand. Biofuel demand has improved substantially, tightening the amount of space. Vegetable oil demand is ramping up, and small clean petroleum cargoes are more common. Should bad weather occur then space could become tighter.
It has been busier on the westbound route, as 17,500 tons of paraxylene fixed from Rotterdam to the U.S. Atlantic Coast in the low $30s/t. Several benzene and pyrolysis gasoline cargoes were booked, with low $30s/t heard on some of the larger lots and low $40s/t on the smaller ones. Fifteen thousand tons of methanol went in the low $30s/t too, while mid $40s/t was paid for a similar methanol cargo from the Mediterranean. More methanol is being attempted from different locations. Five thousand tons of paraxylene from Rotterdam to Altamira, Mexico, was struggling to secure space. Several traders are looking at pyrolysis gasoline from Sweden, with levels of $50/t quoted. More paraxylene is quoted from Kotka, Finland, and Antwerp. Sulphuric acid from Aviles, Spain, remains uncovered, while 6,000 tons of toluene and mixed xylenes fixed from Leixoes, Portugal, to the U.S. Gulf and 6,000 tons pyrolysis gasoline was booked from Bilbao, Spain, to the U.S. Gulf. Five thousand tons of APP was attempted from Sillamae, Estonia, to Baltimore, Maryland.
Contractual demand to Asia is still running satisfactorily, but spot demand is feeble. Owners are trying to cover additional bunker costs, but so far, only the vegetable oil markets from the Black Sea have recorded sizeable rises – 40,000 tons of vegetable oil from 1-Black Sea to 2-China is reported to have gone in the mid $60s/t for example.
There is ample tonnage on berth to India and the Middle East Gulf for November which will likely keep rates in check. Traders have been studying possible base oil cargoes from the Baltic to India and the United Arab Emirates. Small parcels of oxo-alcohols have been noted and there are several shipments of benzene, toulene, and xylene taking place to India. Several shipments of solvents have been quoted from the Black Sea to India for later in November.
Strong demand remains in force in Northeast Asia, and combined with the use of compliant bunker fuels rates have strengthened further. November space is increasingly difficult to locate and a number of cargo requirements have been quoted repeatedly for several weeks already without getting covered. In some cases, charterers are widening the loading dates to appeal to more owners. Many cargoes of paraxylene have been quoted into China for November, and base oils have been active again.
Demand southbound remains light in comparison to other trade lanes within Asia. Clean petroleum is one of the more active commodities, especially into the Philippines. Eight thousand tons C5 to solvent naphtha C9 from Daesan, South Korea, to Singapore was quoted for Nov. 12-18, having previously been quoted as Nov. 12-15 during the previous week. Two thousand tons of base oils from Ulsan, South Korea, to Manila have still to be covered. Eighteen thousand tons of caustic fixed from Taixing, China, to Basamuk, Papua New Guinea.
A little more by way of aromatics has been seen northbound this week, including 10,000 tons of paraxylene from Map Ta Phut, Thailand, to China. Three thousand five hundred tons of mixed aromatics from Pasir Gudang, Malaysia, to Nantong, China, remains uncovered off Nov. 22-24 dates. Three thousand tons tons of TBA was quoted from Pasir Gudang to Changshu, China, while aromatics from the new refinery in Brunei give a boost to spot demand, with very large cargoes quoted into China.
There is still some biodiesel being shipped to south China, but there have also been cargoes of mixed aromatics, suggesting the trend will be to move away from biodiesel. Small cargoes of clean petroleum are moving periodically and small base oil parcels are said to have fixed Singapore to Port Klang, Malaysia. Demand otherwise is sluggish and end November space is freely available.
Traders are nibbling at benzene possibilities for December on the transpacific route, though nothing as yet is reported fixed. Owners rate ideas have risen in line with the use of compliant fuels. A large lot of caustic was quoted into the U.S. west coast, but it is doubtful that there is actually a stem for it. Clean petroleum rates on this route have been paying $1.36 million. Sulphuric acid continues to get done into Chile. Strong demand for biofuels underpins the route to Europe, with 40,000 tons fixed from China to Rotterdam at $2.1 million. A number of smaller parcels have been booked in the $80s and $90s/t from Northeast Asia, with mid $70s/t being seen from Southeast Asia. Five thousand tons of acrylonitrile was heard fixed from China to Yalova, Turkey, at $110/t. A couple of ships can still offer November space.
It remains active in the regional markets, with some cargoes still outstanding for several weeks. There have been fewer fresh quotations this week on the eastbound service, especially of the larger lots, but there is still a substantial amount of material to be shipped in both November and December, and rates remain firm. Westbound volumes are steady and include enquiries for caustic, paraxylene, glycols, vinyl acetate monomer, ethyl acetate, styrene and canola. Twelve thousand tons of base oils from Yanbu, Saudi Arabia, to West Africa have so far been unable to find cover.
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 email@example.com +44 12 0750 7507. Information about SSY can be found atwww.ssyonline.com. In the Houston office,Steve Rosenthalof 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.