U.S. Gulf
The market in the U.S. Gulf is building up for an interesting end of year. The rush to ship material to Asia has almost ceased. There have been some styrene and benzene/toluene/xylene requirements, and a large cargo of reformate has just been booked. The majority of scheduled ships for December are full, with just a couple having 5,000 ton pockets of space. Anything larger than that is going to need an outsider to come on berth.
The rates with the scheduled carriers are mid-high $60s/t for 5,000 ton lots Houston to Mainport Far East. The outsiders will be much higher. However, it remains to be seen what else is quoted to Asia. But the outsiders are flexible and can look at routes where there is demand.
Currently, that is eastbound transatlantic, where ethanol is frequently quoted. Rates for 5,000 ton cargoes from the U.S. Gulf to Rotterdam are around $50/t, but a cargo of around 7,000 tons from the U.S. Atlantic coast to Rotterdam was fixed at around $60/t. U.S. Gulf to Mediterranean is also ultra-tight, and there are a variety of cargoes which could draw away another outsider.
The number of outsiders is also finite, with not more than a handful available. U.S. Gulf to east coast South America has certainly accounted for one or two, chiefly with styrene and caustic. U.S. Gulf to India too could be attractive as there are some large lots of ethanol and biodiesel being quoted. Right now, out of the U.S. Gulf it is a game of bluff and counter-bluff, and it could go either way.
Europe
Business finally started to pick up in the North Sea and Baltic, with a number of ships fixed through until Christmas already. The clean petroleum market too is benefitting from the cold weather in Europe, with good demand seen.
The feeling among the charterers, however, is that if you cannot find a ship on the day that you want to load, if you wait one or two more days there will be something suitable. This in effect sums up Europe these days. In the Mediterranean, the level of enquiry has moved up slightly, but it is very tentative and intermittent. Unless more cargoes are quoted soon, there will be a lot of ships idle over the Christmas period.
Moving out of Europe has been a bit easier this week. The amount of business quoted to Asia for example has risen, taking freights back up. For example, 3,000 ton cargoes from Antwerp-Rotterdam-Amsterdam to Mainport Far East are beginning to see levels in the upper $80s and low $90s/t again.
One of the main reasons has been that the phosphoric acid producers in the Mediterranean have been able to agree on prices with their Indian customers at last, and phosphoric acid exports have resumed. There were a bunch of ships last week that were unsure about their December program and were starting to muscle in on the Far East market.
Those ships are now accounted for, and with more pyrolysis gasoline and vegetable oil showing from the Mediterranean and Black Sea to India and the Middle East Gulf, there seems to be better chances to escape from Europe.
Asia
Dense fog affected navigation on the Yangtze this week, adding a day or two to every trip and therefore causing the domestic Asian market to look a little bit tighter.
Demand is strong into China currently, with styrene, toluene and pyrolysis gasoline seen. Rates for 3,000 ton parcels from Singapore to Shanghai have risen from around $30/t at the beginning of November to around $37/t today.
Spot export activity from Asia revolves around sulphuric acid, fine grade chemicals such as butyl acrylate and ethyl acetate, benzene, though only in January, and a few tentative enquiries for pyrolysis gasoline to the U.S. and toluene to Europe. Numbers to the U.S. Gulf are hovering around $55 to $57/t for 5,000 ton lots from Korea to Houston.
Palm oils are the other main staple from Asia, and demand is strong to Europe, though it looks to have peaked to India, with numbers just coming off a bit. For instance, 5,500 tons of palm oil was fixed from the Malacca Straits to Haldia at $29/t.
The Middle East Gulf to India zone is holding up. A parcel of 5,000 tons of base oils from west coast India to the Eastern Mediterranean would probably fetch $60 to $65/t presently. Demand is strong into Asia too, with a number of methanol, MTBE, benzene/toluene/xylene and glycol cargoes quoted.
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.