The route out to Asia is the most active and is gobbling up whatever tonnage is around. Even small 13,000 tonners that normally trade in the Caribbean have been enticed with freights that are between $110 and $140/t, depending upon the size of cargo and destination. Such rates are not based on small parcels either, but 5,000 to 10,000 ton quantities.

The overriding urge seems to be to get the material out of the U.S., but curiously, it is no longer date sensitive. Normally, the year-end rush relies on shipments before end December, but we are increasingly seeing January requirements.

The price advantage the U.S. has in terms of commodity pricing is substantial. For example, there are Asian phenol and acetone factories that have temporarily stopped production, ostensibly because of lack of demand, but the reality looks to be that the demand is being covered with U.S. product instead. There are other grades such as styrene, ethylene dichloride, glycols, paraxylene and orthoxylene that would normally be sourced from the Middle East Gulf, but there are suggestions that this product is not available either through plant stoppages or else the prices are too high.

The transatlantic arbitrage to Europe however is not that great. There is some interest in shipping styrene and possibly acetone and phenol, but the main grade is ethanol which underpins this route. Rates have moved upwards to mid-high $50s/t for 5,000 ton lots from Houston to Rotterdam.

Trade to the east coast of South America is a victim of the shortage of space as well as continued strong demand. One of the regular carriers on this service has inserted another extra ship in order to satisfy demand. Ethanol, aromatics, acetone, caustic and base oils are among the main commodities being shipped, the rates for which are now in the low $70s/t for 5,000 ton lots from the U.S. Gulf to Santos.

Gulf-to-India is active too. There are reports of 10,000 tons of base oils to be shipped to India and the Middle East Gulf, but we can confirm there is no remaining space in December for 10,000 ton parcels on the scheduled carriers. Notionally, rates for such cargoes would be around $90/t but subject to ship availability.

Europe
There would normally be a seasonal rush to fix the last remaining cargoes before year-end, and contractual volumes usually jump at this time of year as shippers honour all the committed annual volumes, but things have been remarkably sedate so far. There is not a huge amount of open tonnage, but it is certainly no rush for space either.

In the North Sea and Baltic there are certainly some open positions, and in the Mediterranean there are more than just a few. Rates are clinging on so far, but another week of low activity will surely cause numbers to fall. Fortunately, there is a reasonable volume of vegetable oil and clean petroleum products to be done from the Black Sea which will help cover some of the space.

Transatlantic westbound is not exactly busy, but there has been an assortment of aromatics, biodiesel, base oils, gasoline components, urea ammonia nitrate and sulphuric acid that have caused rates to lift slightly. From Rotterdam to Houston 5,000 ton parcels are pegged at around $45/t. Some owners seek levels in the $50s/t, but it may be hard to make such a figure stick.

Europe-to-Asia has seen a new burst of activity, and levels for 5,000 tons from Rotterdam to main Far East ports have been established in the mid $90s/t. There are a few base oil enquiries, but fewer than before. Benzene, MTBE, EDC, acetone, butanols, OX and acrylonitrile are among the primary grades.

Europe-India-Middle East Gulf is tight for December space, with base oils, phosphoric acid, aromatics, pyrolysis gasoline, EDC, ACN and vegetable oil on the move. Rates are approaching mid $70s/t for 5,000 ton lots, but subject to timing and vessel availability.

Asia
There is a distinct feeling that the Asian market will be heading for oversupply of tonnage when all the ships arrive from the U.S. and Europe in January. Meantime, there is already a slowdown in Asian export trade. Only half the regular volume of benzene is being shipped to the U.S. in December, and sulphuric acid quantities to the Americas are also reduced. Palm oil and biodiesel demand remains strong, but the rates have begun to soften here and there.

There are also a number of larger ships open in Northeast Asia over the next week or so, and domestic Asian markets seem unable to support these larger vessels. Even the market for coasters in Asia is a bit dull.

Intra-Far East is perhaps still quite busy, with aromatics, glycol and styrene into China and Taiwan, mostly from Korea but also more Taiwanese material has been seen. Southbound demand for tonnage is adequate, seeing that many of the small coasters are tied up on the intra-Far East route. Northbound however could potentially slacken as the major aromatics plant in Tuban will go for turnaround later this month. Intra-Southeast Asia is reported to be busy on chemicals but quiet for clean petroleum products.

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 at fix@ssychems.com or by phone at +44 1207-507507. In the London office SSYs Jordi Maymi can be reached at fix@ssychems.com or +44 20 7977 7560.