The U.S. Gulf to Far East is another route that seems to have tightened in October, with only a few ships holding the occasional open tank. Of course, if there is a surge in demand, extra ships can be dug out of the clean petroleum pool, but numbers will already have risen by that point. For some forward fixing, it should still be possible to find space below $60/t for 5,000 ton parcels from the U.S. Gulf to scheduled principal ports in the Far East, but such deals ought to really be concluded now.

Forward fixing is the name of the game on the U.S. Gulf to East Coast South America service, too. End October, early November still sees some vessels with part-cargo space, in which case, rates of $60/t could be achievable for 5,000 ton parcels from Houston to Santos, for example. Some base oil traffic is being recorded into Brazil from the U.S. Gulf, but also out from North Brazil, chiefly back to Europe.

The U.S. Gulf to the Caribbean is rather mundane, and if anything, trade has slackened, perhaps due to the elections in Venezuela.

Europe
Rates in the North Sea and Baltic are highly competitive at the moment, almost as if a small-scale rate war has broken out between a couple of the established players. The understanding is that contractual demand has dropped for these owners and they are now sparring on the open market for spot business. In terms of open space, there are not that many seriously spot ships, which makes the war rather puzzling, but good for charterers nonetheless.

Southbound into the Mediterranean on the other hand is more in favour of the owners, who are keeping a firm grip on rates. Demand for space is strong and base oil still forms a reasonable percentage of trade so far, although we are aware this may change shortly.

Northbound is steady with no major changes. Intra-Mediterranean business is brisk with cargoes out of both East and West Mediterranean. A lot of the parcels are chemical ones, but there is diverse mix of vegetable oils, molasses, biodiesel and base oil, too. On the whole, owners rate ideas are strong.

Transatlantic westbound business has flourished with benzene and pyrolysis gasoline in particular being booked across. Rates are in the low $40s/t for 5,000 ton parcels from Rotterdam to the U.S. Gulf, which is not really any different than that of a few weeks ago, but it has helped take up the amount of slack tonnage which might have otherwise caused rates to go down.

Europe to the Far East is quiet, although October space is not so easy to secure. Rates are hovering in the $85/t region for 4000 to 5,000 ton cargoes from Rotterdam to scheduled principal ports in the Far East. There are several November vessels available and for forward fixing, there may be some flexibility in rates, which may not be there long if the year-end rush does start soon.

Europe to India and the Middle East Gulf region is busy with phosphoric acid and some vegetable oils, but base oil does not seem to be part of the cargo mix at the moment.

Asia:
There are several routes within the Domestic Asia region that seem to be getting a bit tighter on October space. Intra-Far East, for example. A number of prompt requirements have been circulated in that market for several weeks without being fixed, and now the charterers are widening the loading dates to encompass any October loading.

There is more of a buzz to northbound business, too, from Southeast Asia, with aromatics, methanol, pyrolysis gasoline, paraxylene, benzene and of course base oil noted.

Southbound looks fairly healthy, while inter-Southeast Asia has a bunch of aromatics, ethylene dichloride and solvents to be moved.

Asia Export trades are busier into the India/Middle East Gulf region, with many more cargoes quoted. Base oils, however, is not a key component, with business comprised mostly of chemicals instead, such as benzene, toluene, phenol, acetone, acetic acid and caustic.

Rates have risen on the Asia to United States service, with some large cargoes of benzene encountered. Owners are looking to use the extra demand as a way to raise freight levels well into the $60s/t for 5,000 ton cargoes from Korea to Houston, and we have even seen $70s/t quoted.

Levels from Asia to Europe are mostly steady, although we do know of some smaller parcels of chemicals that have been booked from China into Turkey at an astonishing $115/t, which represents a $20/t decrease on previous levels.

Palm oil demand is strong, which is a major reason why so many other rates in the area are strong, too. The Middle East Gulf/India is going through a busy phase at the moment. Rates are strong eastbound, and we have seen small cargoes of 2,000 to 3,500 ton chemicals being fixed from the Middle East Gulf to East Coast of India in the high $70s/t. In addition, there is strong demand for a wide range of cargoes, including aromatics, methanol, glycols, ethanol and solvents into the Far East which means that rates have firmed.

Westbound too is reasonably tight on space and numbers are holding steady.

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.