April space has been scarce from the U.S. Gulf to Far East. From Houston to China, 6,000-8,000 metric tons of chemicals went in the high $70s -low $80s per metric ton while 10,000 tons of styrene to China fetched mid $60s/t.

There does appear to be a two-tier market, however, with the prompt shipments commanding a high level, but the second half of May cargoes are back down into the $50s/t again.

Aromatics such as mixed xylenes and paraxylene are hot, as is styrene, monoethylene glycol, cumene, and ethanol. Some base oils have started to look for a ship to Singapore but this may be in response to a similar enquiry from the Mediterranean for the same charterer which is unable to find any ship able to load prompt.

U.S. Gulf-to-India/Middle East Gulfs prompt space is tight, which allowed an extra ship to leap in and take a 20,000-ton ethanol requirement to India, supposedly in the low $60s/t. The same ship is reported to have booked around 16,000 tons of base oil to India, the rate for which should be fairly close to that of the ethanol.

Transatlantic eastbound space is becoming tighter in April, thanks to heavy demand from styrene again. Other cargoes fixed include benzene, cumene, cyclohexane, vinyl acetate monomer, biodiesel and caustic. Some small parcels of base oils have been quoted from the U.S. Gulf to Antwerp-Rotterdam-Amsterdam but there should be some potential carriers available for these small drops. A base oil haul of 15,000 tons continues to seek a ship to go to Nigeria from the U.S. Gulf off prompt dates.

Many of the routes into the Caribbean are very short on space. Colombia especially is busy with more cargoes than ships, following the withdrawal of one regular carrier on this trade lane.

U.S. Gulf-to-the west coast of South America is another route that is providing a good deal of business, to the extent that owners have to choose which cargo to leave behind.

The recent pattern of contractual nominations taking care of a large proportion of all the ships that are loading on the U.S. Gulf-to-Brazil route continues through this week. Minimal space is left therefore for spot business, which seems to have picked up a bit recently. Styrene, glycol, caustic, orthoxylene and paraxylene have all been attempted this week. Base oils are also being quoted, with about 4,000 tons looking to move to Rio de Janeiro. Rates are steady.

Europe

The North Sea and Baltic regions are not quite as solid as before Easter, and a few more ships are able to load over the next couple of days. All the same, contractual nominations have improved toward the end of the month and the total amount of open space is probably comparable to last week. Rates are all pretty stable as a result. Spot base oils have been mostly deliveries to term customers with not that much happening so far from the Baltic.

After a quiet start to the week, southbound began to heat up again with prompt space again in high demand. Not all the bullish talk by owners came to anything, and some had to eat a little humble pie, but nevertheless there were quite a few fixtures done at strong levels – a couple of 6,000-ton parcels from Northern France to the Adriatic achieved mid 40s/t, for example, while 3,000-tons ETBE from Rotterdam to Huelva, Spain, fetched 105,000 and 2,000 tons of paraffins from Antwerp-Rotterdam-Amsterdam to Algeciras paid 75,000.

Northbound prompt space can still be tricky to find, especially if there are special features required, such as stern loading, or inverting the cargo, or even having a ship with the necessary vetting all in order. Demand is generally good and rates are stable or firm.

In the Inter-Mediterranean there was strong demand for space in the West Mediterranean which is keeping freight levels especially strong, and a lot of cargoes are unable to find the right ships on the right dates. For a while it looked as though there were fewer biodiesel requirements, and certainly the number of spot caustic fixtures fell as contract partners came back on track, but a rise in demand for other products in the West Mediterranean, such as clean petroleum, MTBE, benzene and vegetable oil caused space to tighten again. Base oils are being tested toward Turkey from the West Mediterranean and the Black Sea.

From the transatlantic there has not been the same intensity about the westbound route this week. Paraxylene, for example, after a succession of fixtures earlier last week, saw traders switch their attention to Asia instead. Benzene arbitrage faded, and indeed, benzene started to appear on the cargo lists from the U.S. Gulf back to Europe instead. Some pyrolysis gasoline was mentioned, but this is mostly loading from the Mediterranean, and consequently prompt space has begun appearing this week, drawing rates down by several dollars compared to last week.

Europe-to-Far East rates have started to bounce back up again now that there is no April space remaining. Several traders have been investigating paraxylene and mixed xylenes possibilities. One scheduled ship even took a large cargo of pyrolysis gasoline to China. Base oils have been quoted from the Mediterranean, but the charterers have been unable to find ships and are now casting their nets into May in the hope of snaring some passing ships.

Small parcels traffic is busy on the Europe-to-India/Middle East Gulf route, with plenty of toluene, mixed xylenes, solvent naphtha C9, orthoxylene, benzene, cyclohexane, hexane, 2-ethylhexanol, ethylene dichloride and base oils quoted. Vegetable oil trades are strong from the Black Sea too, and 15,000 tons was reportedly booked to Iran in the mid $70s/t.

Asia

The domestic Asia region has not really got going this week and there are still examples of prompt open tonnage. At the same time, some owners are reporting their ships to be available only at the end of May but these are in the minority. Intra-Far East volumes are soft and owners are relying mainly on contracts.

Southbound is slow, too, and there is not the usual flow of base oils from Korea.

Northbound has been reasonably active with aromatics and the occasional base oil parcel but with Thailand still on holiday, nothing too much developed from there.

Asia export is not busy on the long-haul routes, yet owners say they are filling quite well to the U.S., mostly with contracts, urea ammonia nitrate, sulphuric acid and caustic. Methanol is also claimed to have been looking to ship to the U.S.

A handful of ships have space back to Europe but there is not much spot demand. Rates are flaccid but have not given way. A lot of sulphuric acid is moving to India, all paying $33-34/t for 18,000- ton lots. Some base oils have been spotted but the main demand is for solvents, aromatics and styrene.

Palm oil traders have been searching for prompt ships to India, in spite of reports to the contrary. There is also a steady trade again to China while the deep-sea side is supposed to be looking better. Rates are mostly unchanged for now.

The Middle East Gulf/India region is still busy and prompt space is tight. Port delays in some Indian ports such as Kandla are stretching past a week, with some ships stuck for 10-12 days. To add insult to injury, port costs in India will increase from May 1 by 5 percent to 9 percent.

Eastbound space is quite tight with some bigger lots of paraxylene, methanol, glycols benzene and ethanol noted. Westbound, traders continue to seek out space for hauling methanol into the Mediterranean. Further enquiries of MTBE and benzene have been seen.

Adrian Brown is a senior market analyst for chemicals and base oils with SSY Shipbrokers, London. Information about SSY can be found atwww.ssyonline.com. 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.