SSY Base Oil Shipping Report


Europe has overtaken the U.S. as the most prolific and most active of the three main regions. Asia is a poor third with virtually all routes within Asia showing signs of a slowdown.

U.S. Gulf

Styrene is perhaps the main export grade as far as the U.S. is concerned. It underpins the transatlantic eastbound route, where rates are reported to be rising. Parcels in the amount of 5,000 metric tons were fetching high $40s-$50 per ton at the start of the year, and they are now nudging up into the low $50s/t.

Some base oil traffic has been noted, with 3,000 tons heading to northwestern Europe in the low $60s/t. Styrene is also starting to show on the route into Asia. With almost all the Korean styrene production offline through a series of plant maintenance schedules from February, there is plenty of scope for more styrene exports from the U.S.

Rates have fallen substantially since the end of last year, when 5,000-ton cargoes were paying in the $60s/t, and are now closer to mid $50s/t. There is not a massive amount of open space left into the Far East for January, but owners are clearly rattled and want to fill up their last tanks, perhaps fearful of the approaching Chinese Lunar New Year.

Styrene has also been looking for space on the U.S. Gulf-to-Brazil route along with parcels of caustic, naphtha and acetone.

Base oils have been seen on the U.S. Gulf-to-Caribbean service with some small parcels under discussion to Colombia, as well as a possible deal pending to Venezuela.


Further bad weather in the North Sea caused the suspension of the pilot station in both Rotterdam and Antwerp last week, resulting in inevitable delays and a few cancelled voyages. The base oil market in this area has been mostly contractual with hardly any spot interest out of the Baltic.

Southbound into the Mediterranean has produced a little more spot base oil activity. Turkeys material and rates are pretty strong at the moment. There are a lot of varied requirements all seeking space, ranging from vegetable oils and biodiesel to styrene, ethylene dicholride, ethanol, paraxylene, acrylonitrile, acids and caustic. Rates into the West Mediterranean can easily see levels of low-mid 30s/t for 4,000-5,000-ton parcels.

Northbound is strong too. A 4,000-ton cargo of aromatics going from the west coast of Italy to Antwerp-Rotterdam-Amsterdam was put on hold for a while because the cheapest numbers were showing 47-48/t, which is almost 10/t higher than usual.

Inter-Mediterranean markets have seen their share of higher freights. It has been tricky to locate suitable tonnage in the West Mediterranean especially. Easy chemical cargos of 3,000 tons, for example, paid 85,000 for a voyage of less than two days in the West Mediterranean. A more normal number for this routine shipment would be 55,000-65,000.

Some small base oil requirements have been seen heading towards Turkey from the Black Sea and West Mediterranean.

Transatlantic westbound has been fairly busy and there are signs of further requirements in the pipeline. Paraxylene, toluene, sulphuric acid, MTBE, reformate, cumene, urea ammonia nitrate and some base oils have been detected this week. Rates are perhaps steady since there are a couple of ships wanting to fill out, but contracts are evidently performing well since some scheduled owners have no space until March.

Europe-to-Far East is also starting to surge. Styrene forms part of the product mix, but there are requirements for ethylene dichloride, oxo-alcohols, aromatics and acrylonitrile. Base oils have been seen, but the impression is that it is trader business and the requirements are not terribly firm.

Numbers are fairly strong on the Europe-to-India-to-Middle East Gulf route too. Base oils have been discussed, but there are quite a number of chemicals and vegetable oil requirements in addition. Cargoes of 2,500-3,000 tons of base oils from the West Mediterranean to west coast of India would be expected to pay mid $90s/t presently.


It has not been a positive week with regards the domestic Asia market. There are still many gaps in owners programs but already the number of potential orders is thinning out quickly. Base oils have perhaps bucked the trend and there seems to be quite a few requirements, mostly for shipment prior to the lunar holidays. China is seen to be a potential destination for base oils, and there are a number of enquiries within Southeast Asia too.

The Asia export market has at least been fairly active. Methanol, benzene and urea ammonia nitrate have been fixed to the U.S., while methanol, benzene and base oils have been seen to Europe.

Rates are a touch lower to Europe but still about the same to the U.S.

Palm oil demand is very poor presently, with hardly any demand from China and India, and even long-haul demand is flat, pushing freight rates down. The surplus palm oil carriers are keen to secure employment and it may be possible to squeeze lower numbers for chemicals and base oils on the Asia-to-India-to-Middle East Gulfrun, for example.

The Middle East Gulf-to-India region has not been an attractive proposition for owners. Rates are falling on the eastbound route to Asia and even the westbound route into Europe is seeing lower numbers.

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.

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