The Americas market has restarted on a positive note after the vacation period, but Europe is still weak and desperately oversupplied with tonnage. Asia is steady for now.
U.S. Gulf of Mexico
September has been a busier month compared to August. Moreover, imports have been scant, so there has not been a procession of ships turning around in the U.S. Gulf and looking for outbound business.
Indeed, the rest of the month looks quite tight for space in most directions. U.S. Gulf-to-Caribbean routes, for example, have lots of small parcels being quoted and only a couple of ships have space on selected routes. The U.S. Gulf to the east coast of South America too is busier with large lots of caustic and styrene being quoted. A 5,000 ton cargo of base oils from Houston to Rio was reportedly fixed in the low $50s/t, which is a fairly indicative freight for this route.
Transatlantic eastbound is full of enquiries for styrene, xylene, pyrolysis gasoline and ethanol, and freights have bumped up from low $40s/t to mid $40s/t for 5,000 ton lots from Houston to Rotterdam.
U.S. Gulf-to-Asia is generating a considerable amount of interest from traders looking to ship aromatics, styrene, ethylene dichloride and solvents such as acetone and phenol. However, not that many of these requirements actually materialise, and there is a moderate amount of September space remaining. Rates are slowly going up on this route, and a 5,000 ton enquiry from Houston to principal Far East ports would presently attract offers in the low $50s/t.
Europe
The market in the North Sea and Baltic is a bit dull these days. There is a plethora of open tonnage, much of it not belonging in the area but which is stuck because of insufficient cargo to send all the ships back onto the routes on which they would normally sail.
The market in the North Sea and Baltic is a bit dull these days. There is a plethora of open tonnage, much of it not belonging in the area but which is stuck because of insufficient cargo to send all the ships back onto the routes on which they would normally sail.
For instance, there is little happening southbound into the Mediterranean, and ships that brought cargoes up from the Med in August are struggling to find something back down again afterwards. Freights are therefore extremely competitive in this direction.
The Mediterranean too is inundated with ships, and numbers being offered on cargoes back to Northwest Europe are very keen. It could be possible in these circumstances to move 5,000 tons of base oils from the Black Sea to Antwerp-Rotterdam-Amsterdam for rates below $45/t.
Inter-Mediterranean business is soft too. We have seen 3,000 ton cargoes ship from the Russian Black Sea to the western Mediterranean for less than $35/t, although a more regular figure would be around $40/t.
Transatlantic westbound is flat, and aside from the occasional cargo of caustic, pyrolysis gasoline or reformate there is not a great deal happening. Numbers remain a notional $30/t for a 5,000 ton cargo from Antwerp-Rotterdam-Amsterdam to the U.S. Atlantic coast.
Europe-to-Far East is satisfactory for September. Some ships have filled, but a couple others still have space. Several large lots of aromatic mix have been going out to China, chiefly for gasoline usage. Rates for 5,000 ton parcels from Rotterdam to principal Far East ports are steady in the mid $70s/t. Europe-to-India and to the Middle East Gulf are seeing some action on toluene, styrene and base oils. Numbers are essentially high $60s/t for 5,000 ton cargoes from Northwest Europe.
Asia
There is a steady flow of cargoes on the intra-Far East services. As usual, China is the focal point for much of it, perhaps stocking up prior to Golden Week that starts at the beginning of October. Export business to the Americas has been flowing well too, with many ships fixed ahead. Sulphuric acid accounts for some of it, and there is still some benzene flowing.
There is a steady flow of cargoes on the intra-Far East services. As usual, China is the focal point for much of it, perhaps stocking up prior to Golden Week that starts at the beginning of October. Export business to the Americas has been flowing well too, with many ships fixed ahead. Sulphuric acid accounts for some of it, and there is still some benzene flowing.
In fact, September space is a bit thin to either Europe or the United States. Palm oils of course are also responsible for capturing much of the space. Rates for 10,000 to 15,000 ton cargoes of palm oil to the Mediterranean are running well into the $60s/t, with $70s/t being recorded for destinations such as the Black Sea. India, Pakistan and Bangladesh are big markets for the palm oil trade right now, along with cargoes such as reformate and aromatics.
The Middle East Gulf-India region is buzzing, and September space is scarce. Westbound is especially tight – plenty of methanol, MTBE, benzene and glycols have been booked – and 5,000 ton cargoes from the west coast of India to the western Mediterranean are paying high $60s/t to low $70s/t. Eastbound sees more space but rates remain firm nonetheless.
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.