SSY Base Oil Shipping Report


The U.S. and European markets have not been quite as frenzied as they were last week, although there are still fairly strong freight levels on certain routes. Asia has continued experiencing greater demand and some strengthening freight rates.


There have been plenty of eastbound chemical cargo requirements again, but with minimal amounts of open space, the actual number of fixtures has been slim. Base oils have not really been in evidence on this route, although the large cargo requirements into Nigeria are still being circulated.

Instead, there are cargoes of benzene, monoethylene glycol, styrene, caustic, acrylonitrile, phenol and cumene. A 1,000-ton cargo of vinyl acetate monomer from Houston to Antwerp fixed at $90 per metric ton and 4,000-ton glycols from Port Neches, Texas, to Antwerp-Rotterdam-Amsterdam have been seeing rates in the $70s/t, as a reference point.

There is a steady flow of new cargoes coming into the Far East market, but most are for loading later in the month, which does little to assist those owners still holding on to prompt space. Rates have come down quickly on those positions as owners look for ways to fill out. Styrene in the amount of 5,000 tons is said to have gone at $59/t, for example, which is a lot lower than the high $60s/t of just a couple of weeks back.

Base oils are not under the microscope, but some traders had been looking at benzene, which is quite unusual. Otherwise, demand is mainly for styrene, ethanol and cumene.

There is quite a bit of interest this week in moving chemical parcels into Brazil and Argentina, but there is not much open space available for the time being. Cargoes such as acetone, monoethylene glycol, paraxylene, caustic and chloroform have been discussed, with 7,000 tons of caustic reportedly done into Munguba in the mid $70s/t.

The U.S. Gulf-to-Caribbean route is characterized by a lack of space until late in the month. From time to time, the same requirements that were quoted two or three weeks ago are trotted out to see if there are any newcomers on berth, although most end up being deferred again. Base oils are still actively talked into Colombia and Rio Haina.

Rates have edged up again slightly into the India/Middle East Gulf region, with 5,000-ton parcels now seeing rates in the mid $80s/t. Base oils are a vital ingredient to the cargo mix on this route.


The North Sea and Baltic region is largely unchanged, with relatively few prompt open ships although spot demand seems to have declined slightly. After last weeks mass exodus of base oils from the Baltic, this week saw relatively little interest in shipping material to the continent, and instead the cargoes are primarily focused on West Africa.

High levels of southbound demand ensure that space remains scarce, keeping rates where they are. Some base oils have been attempted by majors, with only a small amount of trader interest in taking spot material into Turkey. Quotations include cargoes of paraxylene, benzene, ethanol, caustic, MTBE, acrylonitrile, biodiesel and vegetable oil.

Space continues to be scarce on routes going back to Northwest Europe, which are characterised by the number of non-scheduled ships that have been fixed simply because there have been relatively few alternative candidates. Rates are therefore strong.

Inter-Mediterranean charterers with cargoes to be loaded from the West Mediterranean have again been hard-pressed to find ships on dates that even come close to the ideal loading dates of the cargo, which therefore demands a certain amount of flexibility from the cargo supplier. Rates remain firm. Some base oil activity has been detected but there are not many fixtures seen at the end of the day.

Things are a little slow westbound. Cargoes of pyrolysis gasoline, paraxylene, orthoxylene and urea ammonia nitrate have been pushed around, but there is not much call for base oils these days. Rates are roughly similar to last week.

On routes to the Far East, there is not a great deal of space remaining for June loading, with ships reported to be almost full even for the end of June. Yet there has not been a sudden surge in demand either, but rather more just a steady stream of material such as paraxylene, acrylonitrile, nonene and solvents. Base oils are largely silent. Rates are notionally unchanged for now.

Routes to the India/Middle East Gulf region are some of the only routes on which base oils are quite in evidence, but unfortunately for charterers, there are also quite a few chemical products in competition for space right now, such as ethanol, aromatics, acrylonitrile, cyclohexane and vegetable oils, and therefore rates are not coming down at all.


A number of the routes within Asia are beginning to see greater demand, possibly because a number of large petrochemical complexes are being brought back up online after lengthy periods of plant maintenance.

Another influence has been the approach of Ramadan, which is due to commence on June 18, spurring suppliers and receivers in Malaysia and Indonesia in particular. In many areas, owners have succeeded in employing their ships past the middle of the month, with some ships popping up in July only.

Some have described the base oil market as thin, but despite this, there are a fair number of spot market requirements on almost all the main trade routes. Rates have climbed on northbound routes for instance, with 3,000-ton cargoes from Singapore to Mid China now commanding levels of $43/t-$45/t for parcels where no heat is required.

Some traders are looking at small parcels of base oils into Turkey and Antwerp-Rotterdam-Amsterdam from Korea. Rates are mostly stable, with Turkey perhaps more problematic than Antwerp-Rotterdam-Amsterdam since there are a couple of ships coming out of Korea to Northwest Europe with space. However, since they are large vessels, they cannot entertain the notion of diverting to Turkey. If ships dates could be matched, it may be possible to fix 1,000 tons of base oils into Antwerp-Rotterdam-Amsterdam at $130/t-$135/t, whereas Turkey may cost more like $165/t-$175/t.

Chemicals cargoes of 2,000 tons from Singapore to Antwerp-Rotterdam-Amsterdam were booked at $120/t, but other owners who had ships in position were all looking at over $150/t, for example.

The pre-Ramadan push to have cargoes into India has continued this week, with further pressure added by threats from both Malaysian and Indonesian governments to raise export taxes. Rates are approaching $40/t apparently, but the market may cool off once Ramadan commences.

The Middle East Gulf/India region is still really busy and space is very scarce. It has almost become routine for charterers to quote a cargo for a couple of weeks, leave it a further week or two and then revisit it in case some open tonnage has materialized. There are all sorts of cargoes in varying sizes, from just 1,000-ton parcels right up to 35,000-ton cargoes, both eastbound and westbound.

Owners with open tonnage can have their pick of cargoes, and rates are therefore continuing to strengthen. Aromatics cargoes in the amount of 9,000 tons from India to South China, for example, fixed in the mid $50s/t. And while the palm oil market is proving to be lucrative, owners will not hang around and will instead ballast back to the straits to reload. Of course, once the palm oil trade subsides, as is expected, owners may become a little more communicative.

Adrian Brown is a 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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