There has been a tiny improvement in cargo volumes out of the United States this week, Asian markets are mostly unchanged, and Europe is now starting to slow down.
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After a couple of weeks of almost zero movement, owners report that they are starting to see a few new possibilities for the end of July and August. Seven thousand tons of used cooking oil fixed Houston to Singapore at $77-78 per metric ton, and a couple of ethanol cargoes have been booked from the U.S. Gulf to Asia. Styrene, too, is again being discussed, apparently with some success. Some phenol was apparently booked for the end of July, a parcel of methanol was quoted Houston to Australia, and some ethylene dichloride was being studied to Map Ta Phut, Thailand.
More cargo is being seen on the eastbound transatlantic route, and freight levels have gone back up. Three thousand tons of chemicals from Port Arthur, Texas, to Antwerp-Rotterdam-Amsterdam went in the high $50s/t, and a 5,000 ton parcel of glycols from the Mississippi was covered in the high $40s/t. Five thousand tons of styrene fixed from Lake Charles, Louisiana, to Marmara in the mid $60s/t for the first half of August, but there is another prompt requirement to Egypt that might cost substantially more. That vessel is also working a cargo of 3,000 to 4,000 tons base oils U.S. Gulf to Naples, Italy. Other requirements include styrene, vinyl acetate monomer, glycols, biodiesel, metaxylene, caustic potash and ethylbenzene.
The route to the Caribbean remains heavily overtonnaged, especially since demand is weak. A large lot of caustic was booked into Jamaica, and 10,000 tons of ethanol has been quoted U.S. Gulf to Colombia. Base oils are moving primarily on contractual tonnage, with little spot business recorded.
Ethanol is still not active on the route to South America, with just a single shipment from Texas City, Texas, noted this week. The regular 3,500 tons of base oils from the U.S. Gulf to Brazil went in the low $60s/t for the end of July.
Ethanol and base oils comprise the bulk of cargo inquiries to India and the Middle East Gulf this week, while traders still mull over the possibility of sending methanol to India. Five thousand tons of base oils were booked from Houston to Mumbai for the end of July.
It is felt that fewer new requirements have been quoted over the past week for the North Sea to Baltic route. Biodiesel especially has been much quieter, with around half the number of fixtures and inquiries noted when compared to recent weeks. Most ships have some forwards employment, and so the slowdown is not critical yet, but if it should continue for another week then rates may well crumble. A couple of base oil shipments have been booked out of the Baltic, but nothing too remarkable.
Some base oils are being studied to Turkey for the end of the month, but owners say that southbound demand has fallen this week. Cargoes of styrene and methanol are being checked into the East Mediterranean, while parcels of orthoxylene, sulphuric acid, methyl tertiarybutyl ether, fatty acid methyl ester, vegetable oil, ethanol, paraxylene and caustic have been fixed into the West Mediterranean.
There is not a great deal of northbound space around for July, and 3,000 tons of chemicals from Genoa, Italy, to Antwerp went for a very firm level in the high 50s/t. Six thousand tons of biodiesel from the Adriatic to Antwerp-Rotterdam-Amsterdam paid low- to mid $40s/t, while 3-4,000 tons of aromatics from the Adriatic to Antwerp-Rotterdam-Amsterdam achieved mid $40s/t.
With fewer biodiesel shipments around in the West Mediterranean, ships have been bunching up and causing owners to chase potential business a little more aggressively. A couple of base oil shipments have been covered into Israel, Egypt and Italy.
There has been a steady flow of material westbound across the Atlantic, and in spite of all the ships that are around, rates are pretty steady. Five thousand tons paraxylene from Rotterdam to the U.S. Atlantic Coast went in the mid- to high $30s/t as usual, and 10,000 tons of sulfuric acid was covered from Hamburg, Germany, to Savannah, Georgia, for around $30/t, while 10,000 tons of biodiesel, also from Hamburg, went for a slightly higher level. Ten thousand tons of caustic fixed Antwerp-Rotterdam-Amsterdam to the U.S. Atlantic Coast. A similar quantity was worked for August but seems to have failed to fix cleanly.
Several parcels of styrene bound for the Far East have been mentioned this week, boosting demand. Rates have been talked in the mid- to high $80s/t for the August requirements, but there is little space around for July, which might see a premium being paid. Cargoes of propylene oxide, butanediol, methyl isobutyl ketone, perchlorethone, PGI, acrylonitrile, ADN and some DIDP and solvents have been noted.
There are several ships that still have completion space on the route to India and the Middle East Gulf for July and August and that are generally pegging rates at competitive levels. Ten thousand tons of mixed xylenes is being attempted from Antwerp to Hazira, India, and 2,500 tons acrylonitrile is being tendered from Aliaga, Turkey, with several traders looking at sending it to India. A 1,200-ton base oil shipment from Port Jerome, France, to the United Arab Emirates is reckoned to have fixed for $150,000. Small parcels of PGI, polyol and methyl ethyl ketone have been quoted this week.
The feeling is that there is a little more activity within Asia but that it is patchy and confined to specific routes. Some areas are still pretty slow, such as southbound from Korea and Japan. Intra-Southeast Asia is not that lively either. Generally, the position lists from owners reveal that more vessels are fixed either towards the tail end of July or even into August. Bad weather delays from Typhoon Marias sweep across Korea, Taiwan and Japan have certainly helped tighten up the amount of available space. Rates have not changed across the board however.
Benzene is being discussed for August on the Transpacific route, but so far there have not been many bookings because suitable space is not there. A couple of owners are considering bringing extra ships on berth, which might alleviate the situation. Eighteen thousand base oils are being quoted Singapore to Rotterdam and Houston for mid-August, the July cargo seemingly having been loaded in the mid $80s/t. The market to Europe is steady. Owners report being able to fix many parcels to Turkey, and there are several biodiesel movements that have paid mid $80s/t. One thousand tons of chemicals Singapore to Rotterdam went for $140/t. Three thousand tons of bright stock is being quoted to Alexandria, Egypt, from a variety of loadports in Asia.
There has been a multitude of cargoes throughout the regional markets, and space is tight for prompt loading. Several shipments of base oil have been noted out of Al Ruwais, U.A.E., Sitra, Bahrain, and Yanbu, Saudi Arabia, and there have been plenty of aromatics, methanol, MTBE, acids, caustic, ethylene dichloride, clean petroleum, styrene and glycol cargoes quoted. Eastbound traffic appears to be strong, with quite a few requirements still unfixed from the previous week. Westbound space is scarce, and freights look firmer. Traders have been looking at 6,000 tons of base oils from Ruwais to Turkey, initially for the end of July but are broadening their search to include August loaders.
This report was originally featured in the July 18 edition of Lube Report Americas.
Adrian Brown is 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.