Numbers have firmed however on U.S. Gulf to the east coast of South America, typically by $3 to $4 per ton. Space is tight on this route, and owners are unwilling to schedule additional ships on berth because there are so few cargoes back out to the U.S. Gulf or Caribbean afterwards.

A typical cargo of 5,000 tons from Houston to Santos would now cost low $40s/t. Transatlantic eastbound is perhaps slightly less active than last week. Most scheduled ships however are full, and a cargo of 5,000 tons would pay mid to high $40s/t. However, the U.S. Gulf to Asia trade lane has surely become the victim of the Lunar holidays as demand has slumped.

There are plenty of prompt ships whose owners would probably accept a level in the high $50s/t for 5,000 tons of cargo from Houston to Korea, but the feeling is that business will quickly rebound after the holidays and these freights may curve upwards again. U.S. Gulf to India is busy with limited amounts of space – we see rates for 4,000 tons of base oils from Houston to Mumbai as being mid $90s/t, and something like $105/t basis Jebel Ali.

Europe
Lots of bad weather throughout Europe has caused many delays to ships schedules. It is common for most ships to be running three to four days behind schedule, which is significant in a market where a typical voyage can be three to four days duration.

Consequently, we see a certain amount of tightness, which is causing freight rates to increase. Even the Mediterranean has not been immune, with ships sheltering from strong winds in the west Mediterranean and ice causing delays in some ports around the Sea of Azov. Furthermore, demand for space seems to have risen, whether from fuels, vegetable oils or chemicals, thus keeping the upwards pressure on rates.

Transatlantic westbound is busy. There is a good mix of spot and contractual business to be taken, and scheduled owners are finding February space has all gone. Freights have therefore lifted, and it is possible to see 5,000 tons of parcels from Rotterdam to Houston going over $50/t. Indeed, these rates have even been quoted on 10,000-ton cargoes, but not fixed, so far at least.

Europe to Asia actually registered a minor increase in the amount of cargo quotations, including a number of base oil possibilities. February space has thinned to the extent that unscheduled tonnage is considering going on berth, but only basis higher freights. India too is attracting a lot of interest in shipping chemicals, edible oils and base oils. Levels are perhaps unchanged around $70/t for a cargo of 5,000 tons from Rotterdam to west coast India.

Asia
Asian markets are not noted for activity in the week before the start of the lunar holidays, but this year has been the exception. To an extent, bad weather has played a part, with many vessels clogged up in Chinese ports in particular. The outcome has been a shortage of prompt space, but demand seems to have surged, especially for transshipment business.

With very few coasters (smaller vessels that transship cargoes from larger vessels after deep sea voyages) available, many importing vessels were finding themselves stuck with numerous parcels on board and with little hope of offloading the material prior to the start of the holiday. Export routes from Asia to Europe and the United States appear mostly unchanged.

Benzene is still mentioned on the route into the U.S., while edible oil cargoes and biodiesel support the route into Europe. Business out of India and the Middle East Gulf is brisk, both westbound to Europe and eastbound to Asia. Good volumes of business exist too for ship owners who wish to keep their ships trading between India, Pakistan and the Middle East Gulf.

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.