Demand for space remained slight out of the U.S. Gulf, probably due to the long holiday weekend. European volumes are thin. Deep-sea business failed to ignite, consigning many ships to another week of watching and waiting. Asia remains steady.
U.S. Gulf of Mexico
The U.S. market closed early in anticipation of the 4th July holiday weekend and thus did not contribute much to world trade. U.S. Gulf-to-Far East for instance saw very little new enquiry apart from a few parcels of phenol and ethanol quoted. Several prompt ships have open space and it may be a good moment to negotiate an attractive freight.
U.S. Gulf-to-Caribbean is another service that has an abundance of space, whether into Venezuela or ports on route, or even to the west coast of Central America.
Transatlantic eastbound however sees less open space, at least until the second half of July. Rates for 5,000 ton cargoes from Houston to Rotterdam are fetching between $42 and $45 per ton.
Europe
In comparison to the previous week, European trade has picked up, but there is no strength to freight rates. European coastal business is still heavily over-tonnaged, with the exception of the North Sea and Baltic areas. Southbound into the Mediterranean sees a fair amount of open space for a change, but northbound from the Mediterranean into Northwest Europe has also its share of stories about the competitive freights that have been done.
A 5,000 ton cargo of aromatics from Aliaga to northern France for instance paid just $34/t, and $33 to $34/t was heard on 3,600 tons of urea ammonia nitrate from Constanza to Barreiro. Inter-Mediterranean business seemed to be a bit firmer, at least there were not so many ships chasing each cargo.
Transatlantic westbound produced few surprises this week. Prominent cargoes have been 15,000 to 20,000 ton lots of reformate and alkylate, but the parcel trade was dull. Levels are slightly weaker by a dollar or so.
Europe-to-Asia, in common with all routes into Asia, created few opportunities for owners. Prompt space is easily obtainable and freights are weak.
Asia
It is clear that Chinese buyers are holding back from fresh purchases of cargoes like benzene/toluene/xylene and styrene, which is bringing pressure to bear on freights in the domestic Asian market. Space is fairly tight however on ships heading out of Asia into the U.S. Gulf or Europe. Pyrolysis gasoline seems to be the main export commodity back to Europe, although we have also seen some stray benzene enquiries.
Rates are firm with levels around $60/t reported for 5,000 ton lots from Korea to the U.S. Gulf. Rates into Europe are higher, and the same 5,000 ton parcel would cost around $70/t.
Palm oil markets are vibrant too with good demand reported into India and China. Cargoes of 10,000 tons of palm oil into the Mediterranean are paying in the $60s/t.
The amount of business out of the Middle East Gulf and India remains strong. Westbound space is limited, but there is more open tonnage looking to complete on the short trip from the Middle East Gulf into India or into Asia. Levels are down slightly on this leg, and it should be possible to fix 5,000 tons of base oils from Iran to the west coast of India for a rate between $25 and $27/t.
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 directly at research@ssy.co.uk or by phone at +44 1207-507507. In the U.S., SSYs Steve Rosenthal can be reached at fix@ssychems.com or +1 203-961-1566.