The U.S. market is slowing down, which is evidenced by the increasing amount of open space in the U.S. Gulf. Nor do Europe or Asia appear particularly dynamic, although neither region has significantly deteriorated over the past week.
It has been a quiet week for traffic from the U.S. Gulf Coast to the Caribbean, and in addition to the larger vessels that are fully open in the U.S. Gulf there are still several regular carriers that have part-cargo space available. Into the West Coast, 3,000 tons base oils are looking for October space from the U.S. Gulf to Ecuador, and 3,000-4,000 tons of ethanol is being attempted from the U.S. Gulf to Buenaventura, Colombia, also for October.
Demand for shipments to South America is considered to be steady, with some space being shown for October from several of the regular owners. A shipment of 14,500 cubic meters of ethanol fixed from New Orleans to Brazil with a further shipment of 10,000 cbm ethanol quoted from the U.S. Gulf to Brazil; for Oct 1-10.. Yet more caustic and ethylene dichloride were quoted from the U.S. Gulf to Brazil, and 9,000 tons of base oils were seeking space to Brazil for end of September or early October loading. Eighteen thousand tons sulfuric acid was quoted from Valleyfield or Belledune, Canada, to Paranagua, Brazil, while 18,000 tons of sulfuric acid has just loaded Santa Rosalia, Mexico, to Rio Grande, Brazil.
Methanol continues to attract interest from traders for the Transatlantic route. Twenty thousand tons of methanol is understood to have been done from Puerto Jose to the Mediterranean, while 20,000-25,000 tons methanol was quoted from Point Lisas, Trinidad and Tobago, to Antwerp-Rotterdam-Amsterdam or the western Mediterranean off Oct. 1-10. Between 6,000 and 7,000 tons of pyrolysis gasoline from Houston to Rotterdam was an interesting quotation, given that other traders are quoting pyrolysis gasoline back to the U.S. Gulf from Europe.
Owners claim to have fixed several shipments of styrene to Antwerp-Rotterdam-Amsterdam, and a large combination cargo of styrene, glycols and ethylene dichloride is said to have been booked into the Mediterranean for early October. Ethanol is making its way to the east coast of the United Kingdom from New Orleans. Three thousand tons ethylbenzene was being discussed from Carville to Antwerp-Rotterdam-Amsterdam or Gonfreville, France, and 6,500 tons of reformate was still being circulated for Paulsboro, U.S., to Antwerp-Rotterdam-Amsterdam.
Traders have been studying a shipment of 15,000 tons of caustic from the U.S. Gulf to Gavle, Sweden, plus Pietarsaari and Hamina, Finland,, as well as 15,000-20,000 tons of caustic to Italy or Marmara, Ukraine. The next lifting of used cooking oil from the U.S. Atlantic Coast to the east coast of the U.K. is quoted for the second half of October. Two thousand tons of base oils are looking for space from Brazil to Alexandria, Egypt, and 2,500 tons base oils are quoted from Houston to Haifa, Israel, although the latter deal requires very competitive freight to make it work.
Spot business to Asia remains thin. Ethanol is understood to be one of the main commodities being quoted around. A prompt opportunity arose to ship 5,000 tons of glycol from Lake Charles, Louisiana, to China.
Several traders are working ethanol possibilities to the West Coast of India and the Middle East Gulf. Twenty-two thousand tons of vegetable oil was booked from New Orleans to Pakistan and Mozambique. Traders are looking at shipping 10,000-12,000 tons base oils from Houston to Mumbai and/or Pipavav and/or Hazira, India, off Oct. 5-15 dates.
Along the North Sea and Baltic route tt has been steady week that has seen the majority of vessels pick up enough business to last them for about a week ahead. However, there has been an increase in the number of ships that are open much sooner than that. With bunker costs having increased and remaining higher than a few weeks ago, owners are so far resisting any rate reductions. It is biofuels that are providing the liquidity to keep things moving. Base oils have been reasonably active, with a spot cargo fixed from Antwerp to Riga, Latvia, as well as several system shipments into the Baltic, while a couple of spot fixtures were noted out of Riga and Kaliningrad, Russia. Contractual demand is also strong, to the extent that a surprisingly large number of relets have been necessary this week.
Demand for southbound space is just about keeping pace with what is a rather large supply of ships in the latter part of September. At least three large shipments of fatty acid methyl ester appear to have been booked into the Black Sea. Six thousand tons of caustic were covered from Rotterdam to Genoa, Italy, and 1,500 tons styrene finally concluded from Rotterdam to Berre, Italy, though there has been mention of 3,000 tons styrene to be shipped on that route, too. A cargo of acetic acid fixed Saltend, U.K., to Sines, Portugal, and Algeciras, Spain, but attempts to cover 5,000 tons ethylene dichloride to Turkey and 3,300 tons of base oils into Turkey have been unsuccessful because charterers freight ideas are in the $40s per metric ton in both cases.
Freights have been quite strong on the northbound route, reflecting a shortage of space. Ten thousand tons of biodiesel from Ravenna, Italy, to Rotterdam went for $375,000. Meanwhile, 2,100 tons of cyclohexanone from Genoa, Italy, to Antwerp achieved 60/t, while 10,500 tons C7 fixed from Lavera, France to Antwerp-Rotterdam-Amsterdam, and 10,000-15,000 tons of pyrolysis gasoline was noted from Tarragona, Spain, to Antwerp. Two thousand eight hundred tons of pyrolysis gasoline from Augusta, Sicily, is believed to have gone northwards, as well, while 5,000 tons of benzene concluded from Sarroch, Italy, to Tees, U.K., and a large lot of naphtha looks to have been booked Aliaga, Turkey, to Antwerp-Rotterdam-Amsterdam. Three thousand tons of benzene was quoted from Lavera to Gonfreville, and 2,000-3,000 tons of benzene, toulene and xylene was pushed around Algeciras to Antwerp-Rotterdam-Amsterdam. The next lifting of 5,000 tons of caustic from Lavera to Cardiff, U.K., was noted.
Essentially, prompt space is tight in the West Mediterranean, but it is not quite as tight as it was earlier in the month. Five thousand tons of biodiesel ex southern Spain achieved 87,000, while another biodiesel shipment of just a few hours duration along the Spanish coast fetched 65,000. Meanwhile, 3,500 tons methyl tertiarybutyl ether from Fos, France, to Ravenna attained 150,000 and 2,000 tons of ethanol from Cartagena, Spain, to Milazzo, Italy, yielded 120,000. Even a simple 5,000 tons of clean petroleum cargo from Cartagena to Mahon, Spain, paid 100,000. East Mediterranean activity is still poor however, although it was interesting to see a large shipment of methanol get fixed to the West Mediterranean from Damietta, Egypt.
Given the number of ships on berth westbound, it is unsurprising that quite a bit of off-market Transatlantic business has taken place, especially for cargoes of acid and methanol, several of which were booked this week. A cargo of hydrocracker bottoms appears to have gone from Flushing, Netherlands, to the U.S. Gulf. Traders are looking at pyrolysis gasoline from the Baltic and the U.K. across, and a large lot of paraxylene was quoted from Rotterdam to Mexico. Several parcels of aniline were booked, seemingly in the $40s/t. Fifteen thousand tons of urea ammonia nitrate from Heroya, Norway, to the U.S. Atlantic and Gulf coasts also went in the $40s/t. Between 5,000 and 6,000 tons of benzene is being attempted from from Skikda, Algeria, but also has options to the continent.
A few traders have persevered with styrene possibilities to the Far East from Antwerp-Rotterdam-Amsterdam and Gonfreville, but none has been confirmed fixed. Several parcels of oxo-alcohol were worked too, and some butanediol to Vietnam was quoted. Five thousand five hundred tons base oils from Antwerp to Singapore and Ulsan, South Korea, were apparently worked.
There is quite a lot of tonnage on berth, keeping rates to India and the Middle East Gulf depressed. A combined 7,350 tons of base oils and solvents were quoted to the Red Sea and the Middle East Gulf, and there is still some polyol to Jebel Ali and Al Jubail, Saudi Arabia. Five thousand tons of caustic from Antwerp-Rotterdam-Amsterdam to Yanbual Bahr, Saudi Arabia, was an interesting quotation.
Along the route to Northeast Asia, the knee-jerk response to cover in material following the drone attacks in Saudi Arabia has subsided, but it exposed the frailty of stock levels in China. The week-long mid-autumn holiday will cause activity levels to slow down, but re-stocking should stimulate trade afterwards. Meanwhile, Typhoon Tapah is passing through the region and will keep prompt space tight.
The market for southbound shipments is calm but stable. Five thousand tons of sodium hypochlorite from Daesan, South Korea, to Singapore was circulated once again for loading at the end of the month, with the next lifting already quoted for mid-October. Meanwhile, 3,800 tons of styrene was noted from Daesan to Map Ta Phut, Thailand, and Bangkok, while several small parcels of base oil were quoted from South Korea. Some of the larger vessels on the route are facing difficulty securing enough volume, however.
Spot northbound demand is quite strong presently, whereas prompt space is limited. Cargoes of heavy aromatics, pyrolysis gasoline, paraxylene, styrene, MTBE and benzene have been noted. Several cargoes of glycerine are quoted to China, some of which have already been around for a week or more. Similarly, 3,000 tons of naphtha from Kemaman, Malaysia, to Zhuhai, China, entered a third week of trying to fix. Six thousand tons of unconverted oil from Bangkok to Ulsan is still there. Large requirements include 17,000 tons of base oil from Dumai to Ulsan and Nantong, China, and 18,000 tons paraxylene and benzene from Singapore to China, both of which are for early October.
The parcels market within Southeast Asia looks rather subdued currently, with just some pyrolysis gasoline, benzene, MTBE and 2-ethylhexanol noted. The small tanker clean petroleum market looks a bit more encouraging, with most owners fixed into October. Biodiesel is still being quoted into China for the first half of October, but there have also been cargoes of mixed aromatics into China, suggesting the market might be making the seasonal switch of blending grades. However, stock levels for mixed aromatics are very low in China, meaning that activity could pick up after the holidays.
Contractual demand is healthy on the Transpacific route, but spot demand has receded as traders stopped quoting benzene for now. A couple of regular carriers have some part-cargo space available for October. There is still a staggering amount of biofuels being booked back to Europe. Rates are quite strong from Northeast Asia, but there is some space available from Southeast Asia. A bunch of small chemicals parcels have been fixed into Turkey, the rates for which are believed to be back into the $140s and $150s/t again. Six thousand tons benzene was quoted from Map Ta Phut, Thailand, to Gonfreville, France.
More cargoes have been recorded in the regional markets this week, with benzene, paraxylene, methanol, pyrolysis gasoline, glycols and base oil particularly noticeable. Several large cargoes of methanol have been seen on the Eastbound route, and there are the typical cargoes of aromatics from India. Rates seem to be steady. Westbound saw a prompt cargo of 19,000 tons of biodiesel quoted for transhipment off Galle, Sri Lanka, suggesting a ship might have some technical difficulties. Between 12,000 and 20,000 tons of caustic was quoted from Mesaieed, Qatar, to the Mediterranean, and 6,000 tons of vinyl acetate monomer was seen from Al Jubail to Alexandria and Antwerp. Twelve thousand tons of canola oil was circulated from Jebel Ali to Antwerp-Rotterdam-Amsterdam, and small parcels of ethanol and glycol were also being pushed around.
This report was originally featured in the September 24 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.