U.S. markets have tightened noticeably for January loading, and rates have lifted on some routes. European coastal trades are still depressed but the deep-sea routes are better. Asia continues to be very busy all round.
U.S. Gulf of Mexico
Transatlantic eastbound rates rose from mid $40s to close on $50/t for 5,000 ton parcels from Houston to Rotterdam for January loading. This reflects prompt demand for ethanol and styrene that has caused space out of the U.S. Gulf to disappear. Peeking into February, the rates revert to $46 to $47/t, if booked ahead. In fact, almost every U.S. route reports a degree of tightness about space availability. Partly this is down to additional demand, but also bad weather in the U.S. Gulf that has caused umpteen delays.
U.S. Gulf to the east coast of South America is now much tighter than it was, and a prompt cargo would certainly need a premium to be paid on the usual mid $60s/t that is the norm for 5,000 ton parcels from Houston to Santos. Base oils have been tracked shipping both into and out of the U.S. and Brazil, and there is a requirement outstanding for a couple of weeks to ship a large cargo of base oils from the U.S. Gulf to Nigeria.
U.S. Gulf to the Caribbean is another trade lane that sees January space drying up. Rates are creeping up slightly and a 5,000 ton parcel from Houston to the east coast of Mexico would now command around $24/t.
U.S. Gulf to Far East is moderately busy. Several ships can still manage parcels up to 5,000 tons in size, but traders have been looking at large lots of aromatics in 20,000 ton chunks, the rates for which have been high $60s to low $70s/t. Owners that have February tonnage are discounting in advance, and rates in the mid $70s/t are achievable at this point.
Europe
A further batch of fixtures confirms that substantially lower rates achieved last week in the North Sea were not exceptional. Decreases of 10 percent to 25 percent have been confirmed again this week as owners strive to create a forwards program for their ships, but with some ships sitting idle since late December it can be a mammoth task.
The Baltic however is starting to see rates for parcels start to edge upwards as the ice belts grow and ships without ice-class retreat from the area. Clean petroleum products have been more active too, and rates have jumped; 10,000 tons of naphtha from Kaliningrad to Antwerp-Rotterdam-Amsterdam paid $280,000, compared to a more normal $200,000.
The market southbound into the Mediterranean is well stocked with cargoes, but the array of ships requiring cargoes is also quite large and rates remain unchanged. Northbound out of the Med is dull, whereas intra-Med routes saw a slight improvement in prompt cargo requirements. FAME has been the backbone of this market. A sudden rise in air temperature in the Black Sea and Crimea has caused a suspension of the ice season for a while.
Transatlantic westbound rates are stiffer due to an increase in the amount of material looking to move across, which in turn has caused rates to increase into the mid-to-high $40s/t for 5,000 ton parcels from Rotterdam to Houston. Parcels of paraxylene, pyrolysis gasoline, toluene, mixed xylenes, UAN and caustic have been noted.
Europe to Far East has also been busy and there are no longer any vessels with January space from Northwest Europe. The only real space comes from ships already traversing the Med on their way out. Rate levels are therefore up a bit into upper $90s/t for 5,000 t lots from Rotterdam to China.
Europe to India and the Middle East Gulf is fairly busy with aromatics, vegetable oil, pyrolysis gasoline, phosphoric acid and some parcels of base oil. Rates are typically mid $70s/t for 5,000 ton lots from Rotterdam to the west coast of India.
Asia
There are still a number of cargoes forlornly seeking January space on the Domestic Asia market, but almost every vessel is showing either a February open position, or in some cases even March positions. Clearly demand prior to the Lunar Holidays in February is strong and this is causing freights to firm. A widely-reported 10,000 t parcel of paraxylene from Maptaphut to Dalian secured $51/t, which is some $10/t above the usual levels.
Export Asia business is functioning well with only a limited number of carriers available. Benzene is reported in the market to move to the U.S., along with large cargoes of caustic. Biodiesel, caustic and palm oil are the primary products being shipped to Europe, and freight levels are close to $100/t for 5,000 to 6,000 ton cargoes from Korea to Rotterdam.
Freights from Far East into India-Middle East Gulf are also buoyant, and rates in the $50s and $60s/t have been claimed for 7,000 to 10,000t parcels. The Middle East Gulf-India region is busy and 3,000 ton parcels from the west coast of India to the Middle East Gulf are mentioned seeing levels of $50 to $60/t for example. Westbound is tight, and traders looking at shipping ethanol from Karachi to the Mediterranean have been faced with levels in the $80s and $90s/t for 3,000 to 4,000 ton lots. Eastbound is reported to be active, but there are still a number of ships that could use a top-up cargo.
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.