SSY Base Oil Shipping Report


Trade has remained muted across all main regions because commodity prices have still not bottomed out and buyers are taking their time before confirming purchases.

U.S. Gulf

There has not been too much going on in the Americas since the start of the year.

U.S. Gulf-to-Far East has not seen much firm business, although contractual nominations are strong. Space can be found on a selection of January loaders. The main products seem to be ethanol and acrylonitrile, with styrene demand falling by the wayside. Some base oils have been considered, but the only fixture so far has been for 7,700 metric tons to Singapore on a ship that has been sold to Asia, with freight reported to be in the mid-high $70s/per metric ton.

Base oils continue to be talked about on the U.S. Gulf-to-India-to-Middle East Gulf route, with the aim now being for February loading. Rates are gradually declining on this service, with 10,000 tons to the west coast of India being discussed in the $70s/t.

Small lots of base oils have been seen on the U.S. Gulf-to-Caribbean and U.S. Gulf-to-west coast of South America routes.

Space can be fairly tight on the U.S. Gulf-to-Caribbean market, thanks to heavy contractual nominations for January, but there are still some vessels that are open in the U.S. Gulf which could be harnessed if necessary.

Small pieces of base oil have cropped up on the list of cargoes going from the U. S. Gulf to the east coast of South America as well, but apart from some ethanol, paraxylene and caustic, there is not a huge amount happening on this route. Rates are deemed to be stable.

Transatlantic eastbound has been rather slow this week. At one point, there was a mass of styrene possibilities for the U.S. Gulf-to-Antwerp-Rotterdam-Amsterdam route, but they were soon deferred to February loading and March arrival in Europe. Other than that, there has been a bit of ethanol, acrylonitrile and glycols.

Freights seem to have nudged downward slightly, with 5,000-ton parcels from Houston to Rotterdam now fetching high $40s/t.


Storm-force winds have been battering parts of the North Sea, causing inevitable delays. The Kiel Canal was closed for a while too. For a while, business was somewhat slow and it seemed there may be a glut of spot ships in the area, but contract demand has gradually kicked in. Subsequently, many of the prompt ships have been absorbed, with the exception being those owners whose contract partners were hosting plant turnarounds. This left them at the mercy of the spot market, taking cargoes such as urea ammonia nitrate and biodiesel at freight levels they would not normally contemplate.

Southboundinto the Mediterranean has produced a couple of base oil shipments, but mainly for term-contract customers. Chemicals, vegetable oil and biodiesel demand has been reasonably strong on the route, keeping freights on a strong footing.

Northbound demand has been reasonably stable, with pyrolysis gasoline, methanol biodiesel, caustic, styrene and ETBE noted.

Inter-Mediterranean business has also been affected by winter weather, with a number of Italian ports closed for a while. The Bosporus was also closed for a short period due to poor visibility during snow showers.

Space has been tight in the west Mediterranean, while in the Black Sea there have been a number of alternative cargoes for owners, including pyrolysis gasoline, caustic, methanol, urea ammonia nitrate and vegetable oil. Base oils have been appearing in small lots from the Black Sea, but a couple of larger base oil shipments have been heading out east through Suez.

Europe-to-India-to-Middle East Gulf has certainly attracted some base oil interest from traders. Rates remain quite strong, however, due to the selection of cargoes available to owners, which include aromatics, vegetable oils, acids and smaller parcels of more sophisticated chemicals.

From the west Mediterranean to the west coast of India, 5,000-ton parcels of base oil will command numbers in the mid $80s/t.

Europe-to-Far East has seen a couple of base oil movements too, but most enquiries have been for small parcels. There is not a lot happening to Asia right now and there is still part-cargo space available. Rates under $90/t may be attainable for 5,000-ton parcels on the Rotterdam-to-mid China route.

Transatlantic westbound has not been especially busy either since the arbitrage for benzene has closed. Paraxylene has been fixing across the U.S., along with pyrolysis gasoline, cumene, sulphuric acid and urea ammonia nitrate.

Mediterranean-to-U.S. is very tight on prompt space, and traders have been checking rates on parcels of bright stock. From Aliaga to the U.S. Atlantic coast, 7,000 tons of paraxylene was heard to have gone in the upper $70s/t, as a guide.


Things are not completely comfortable in the domestic Asia market.

There are some parcels of aromatics heading into China, namely mixed xylenes, toluene and some benzene, but volumes are not at usual levels and space can be found fairly easily.

Southbound into Southeast Asia is somewhat lacking in demand, although there are base oils on the menu out of Korea.

Northbound is perhaps the busiest route with the greatest variety of cargoes, but there are ships that can offer January space here.

Asia export is just holding its own. Benzene is a popular product, and methanol is starting to show, looking for space to both Europe and the U.S., since there are a series of methanol plant shutdowns due to take place in the Atlantic Basin. Some larger lots of urea ammonia nitrate and renewable fuels have also popped up this week.

Palm oil demand is a little subdued, however, and rates on long-haul destinations have slipped slightly. There have been suggestions of a cargo into the Black Sea going for less than $70/t, for example. India and China are not receiving much palm oil in January either.

The Middle East Gulf-to-India region is felt to be quiet at the moment, and there are certainly some prompt ships available. Rates both east and westbound are judged to have come off by around $2/t, but are not expected to go much lower, as there has been a fresh round of prompt enquiries.

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

Related Topics

Logistics & Distribution    Market Topics    Shipping