SSY Base Oil Shipping Report


The American Fuel & Petrochemical Manufacturers meeting in San Antonio last week led to noticeably quieter markets, not just in the U.S., but globally. Easter break, which has begun in many areas, has also contributed to reduced activity.

U.S. Gulf

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There was minimal activity on the major trade lanes out of the U.S. Gulf last week, primarily because of the huge AFPM event that took place in San Antonio. In trade from the U.S. Gulf to Caribbean, a region that has been fairly tight on vessel space for a couple of weeks, several prompt positions popped open. Rates do not appear to have outwardly moved, but perhaps owners might be a little more willing to negotiate than they were before. Styrene, in the amount of 11,000 tons from the U.S. Gulf to the east coast of Mexico, for example, went for $19 per metric ton, which is a little less than normal.

There is some first half of April space available on the U.S. Gulf to east coast of South America route, but demand seems a little thin right now. Not even the base oil traders seem interested in moving anything right now, apart from a possibility that ethanol may start to ship to Brazil shortly due to price erosion in the U.S. Gulf.

Transatlantic eastbound was active earlier last week as styrene traders flooded the market with enquiries. After a while, however, things eased off and rates appear to have settled down into the $47-48/t region for 5,000 ton parcels from Houston to Antwerp-Rotterdam-Amsterdam.

U.S. Gulf to Far East also registered a fair amount of demand to ship styrene to Asia, the rates for which have been around $65-68/t for 5,000 ton parcels. Traders also started to look at products such as orthoxylene, acrylonitrile, and ethylene dichloride, but there does seem to be a certain amount of rate-checking going on, perhaps in response to meetings that were held in San Antonio. It may take another week for these to really come to fruition. In the meantime, there is adequate prompt space available.


The AFPM event most certainly left its mark on European business over the past week, and there is a quieter feel to things on a couple of routes.

In the North Sea and Baltic, contractual demand has been adequate and the chemical and biodiesel spot markets have contributed a reasonable range of cargoes. However, small clean petroleum markets have been very slow and owners in this sector will be looking to turn their hand to base oils or easy chemicals.

Southbound into the Mediterranean has produced the occasional surprise prompt position, but the majority of vessels have been well booked, and there is still a steady stream of cargoes looking to ship into the Mediterranean. Base oils are not active and those that are in the market are mostly term shipments.

Northbound is a little less busy as well and the impression is that contractual volumes are less, particularly since there are a couple of ships open that would normally be employed on such contracts.

Inter-Mediterranean markets are certainly quieter and space has opened up in areas where space hasnt been available for the past month or so. So far, freight levels have held up, but another week of slack demand could cause owners to become more competitive on their freight ideas.

Transatlantic westbound has not been busy, but there have been opportunities for vessels that have had prompt space, such as acetic acid, paraxylene and ethanol which have been paying mid $40s/t to U.S. Atlantic coast for 5,000 ton parcels and upper $40s/t into the U.S. Gulf. Since there is not a substantial amount of spare space, owners are just about able to hang on to these kinds of freights and not concede further discounts. Base oils have not been apparent, whether to the U.S., Caribbean or South America.

Europe to Far East has been slow, but with hardly any space available, charterers are not pushing hard either. The occasional prompt gap does appear on scheduled carriers, but rate ideas tend to be strong nevertheless.

Europe to India-Middle East Gulf is steady. A couple of ships can still offer space from the Black Sea but with very little base oil available from this area it may be that the ships have to fix vegetable oils instead. Rates could be very competitive for the base oils, with numbers in the $60s/t perhaps obtainable.


The AFPM took its toll on the Asian markets too, and owners were complaining that fewer cargoes were being quoted on the domestic Asia market. Smaller ships seem to be having a harder time with fewer 3,000-5,000 ton parcels of aromatic going into China. Owners of larger vessels are having more success, so long as they are willing to book cargoes into India-Middle East Gulf, or Europe or the Americas. Methanol demand has flopped, with only one requirement to note from Labuan to Rotterdam, but there have been a lot of other smaller grades, as well as potential opening to ship benzene to Europe.

Products like phosphoric acid are also being circulated. Normally, this would be sourced from Israel but strikes there are causing customers to look further afield for material. April space is largely full, unless an outsider comes on berth against some of the larger cargoes quoted. Rates still tend to be around $100/t for 5,000 ton cargoes to Europe and upper $60s/t to the U.S. Gulf.

Palm oil demand is low for usual destinations such as India and China, but larger deep-sea cargoes seem to be reasonably consistent. Rates from the Middle East Gulf-India region are being shaped by a surge in Iranian export demand, plant stoppages in the region throughout April, fewer palm oil imports into the Indian Ocean and growing berthing delays in India. Each of these factors will either push or pull freight levels as we go through the month. Currently, rates are just about unchanged, whether eastbound or westbound.

Adrian Brown is senior market analyst for chemicals and base oils with SSY Shipbrokers, London. Information about SSY can be found at Adrian Brown, in the U.K., can be reached at or by phone at +44 1207-507507. In the London office SSYs Panos Giannoulis can be reached at or +44 20 7977 7538 and in Singapore Jordi Maymi at +65 6854 7127.

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