On the route to the Far East, April space was just about all taken care of a week or so ago, so that now, should any space open up, it will be because another cargo – contractual or otherwise – will have been cancelled. The only other prospect is if more ships ballast over from Europe and use some of the larger cargoes that are quoted as a base off which to fill out the balance space.

Methanol, ethanol, styrene, xylenes and ethylene dichloride have been on the wish list. Rates are very unpredictable. May space can still be secured, in which case 5,000-ton parcels will attract numbers in the low-mid $70s per metric ton, but April sees a $10/t premium, at least.

In transatlantic trade, business quietened down somewhat after Easter, but in the past few days there has been a bit more quoted again. What we are probably seeing now are the cargoes that were deferred from last month as charterers tentatively check out what space there is left for April. After all, to keep flooding the market with enquiries would simply inflame rates.

As it happens, April space is pretty well all accounted for, and so many of these requirements will go back into the box. Rates for 5,000-ton parcels are mostly in the low-mid $70s/t region.

Some base oil enquiries are making the rounds, with some destined for Antwerp-Rotterdam-Amsterdam and other cargoes for the Mediterranean. Some of the smaller lots into Turkey will likely record levels of $120/t or so for 1,000-ton to 1,500-ton quantities.

On routes to India and the Middle East Gulf, base oil traders are known to be looking at freight levels into this region and quite possibly found one or two ships with space late in April and May. Numbers are well into the $80s/t, however, for 5,000-ton parcels. Other traders have their eyes on methanol and ethanol into the area.

Space is scarce for April loading on U.S. Gulf-to-Caribbean routes, with many of the little parcels of chemicals still pending. Base oils will have to join the queue. Some space can be had for Chile and the West Coast, but numbers will be over $100/t for small parcels.

On routes to east coast South America, for those wanting to ship base oil down to Brazil and Argentina, the situation is pretty much unchanged. Space is tight for April, but May would provide some alternatives. For example, 3,000-ton to 4,000-ton parcels of base oils have been booked for May to Brazil in the low-mid $70s/t, and there are some larger lots of 10,000t under discussion.

With the seed-crushing season about to begin in Argentina, there is more incentive for an owner to look at how to position ships into this area, and with some luck, the tight space situation could lift slightly.

Europe

Trade in the North Sea and Baltic area has been slow since Easter, and there are definitely more prompt open positions available. Freight levels have declined slightly too. In terms of base oil exports from the Baltic, there is a regular flow to the United Kingdom and Antwerp-Rotterdam-Amsterdam, with several cargoes being sent to West Africa or else collected in storage tanks in Antwerp-Rotterdam-Amsterdam and then exported east and west from there. Until the flow of gasoline-blending components starts in earnest, this region will remain rather weak.

It would be hard to say that demand on southbound routes is particularly heavy going into the Mediterranean, but the majority of ship owners seem to have pretty healthy forward bookings and so there is not that much open space being touted around. Rates into the West Mediterranean are pretty solid, with 3,000-ton parcels into Spanish Mediterranean attracting levels in the low-mid 30s/t. The same cargo into Turkey would attract offers in the mid-high $60s. Some base oils are making their way down into the Mediterranean, but mostly in-house business.

The northbound route doesnt seem to be hugely busy, yet ships seem to fill up with relative ease. Rates are also fairly strong. There have been cases this week where charterers have budgeted for rates in the mid-20s/t for 5,000-ton parcels from South Spain and have ended up paying close to 30/t. However, there is a dearth of cargo out of the Black Sea and freights for base oils from the East Mediterranean to Antwerp-Rotterdam-Amsterdam, for example, could be workable in the low $50s/t for 3,000-ton parcels.

Inter-Med:

In Inter-Mediterranean trade, the Mediterranean is divided into two distinct halves. The West Mediterranean is busy with plenty of demand and a shortage of space, putting an upwards spin on freights. The Black Sea is, however, slow, and ships are ballasting across to the Central Mediterranean or even West Mediterranean.

A small parcel of base oils from Augusta to the Continent is seeking prompt space, and it looks as though it may end up on a ship ballasting in from the East Mediterranean, some five to eight days later than the preferred timing, but it may have to suffice. Base oils have been busy again within the Mediterranean, but not so much has moved from the Black Sea.

In transatlantic trade, it is still not that busy westbound, yet prompt space is not so easy to locate. A couple of smaller ships have been able to slip on berth as a result. One of the prompt requirements is a cargo of base oils into the U.S. Gulf from Spain, which is suspected of having just found a ship, but it will not have been a cheap deal.

Further base oils have been quoted into the United States and Caribbean. Paraxylene is about the only major commodity moving, but all the same, rates on date-sensitive cargoes have increased slightly.

On routes to the Far East, demand is currently low and there is still some April space around. Base oils have been one of the more regular products moving, although methanol has also made an appearance. Currently, 5,000-ton parcels from Rotterdam to Korea are pitched in the low $80s/t.

For trade to India and the Middle East Gulf, space remains tight for April on scheduled carriers. Consequently, some traders have resorted to using smaller ships, but rates are still between low $80s/t and low $90s/t for parcels of 3,000-5,000 tons. Some base oils have been checking to see what ships are around, but no great bargains are there to be had.

Asia

Domestic Asia has had winners and losers this week among the local trading areas. Intra-Far East business has been more productive, and freights out of Korea have lifted slightly, so that 3,000-ton parcels from Ulsan to Spore are paying close to $35/t. Base oils have maintained a steady presence in this area.

Southbound is still one of the slowest routes, and although there is not a huge amount of space, it is clear when owners admit to working caustic into Southeast Asia that there is nothing else workable on the ships dates, since caustic habitually pays the lowest numbers going.

Northbound trades have picked up slightly and intra-Southeast Asia has not had to deal with that much idle tonnage. Rates have not been brilliant for owners though.

In export markets, ample space still remains available on transpacific services for April, with some highly competitive numbers available. Sadly for owners, most of the benzene, paraxylene, mixed xylenes, urea ammonia nitrate and acid cargoes are focused on May loading. This means that while it is possible to fix 6,000 tons of benzene/toluene/xylene from Ulsan to Houston in the high $30s/t within April, that level rises to mid-high $40s/t for May.

Demand on the Asia-to-Europe leg is slow, with primarily smaller parcels quoted, few of which even make it as big as 5,000 tons. All the same, it is possible to fix this volume from Korea to Gebze in the low-mid $90s/t, which is a substantial cut.

India and the Middle East Gulf regional routes are well-stocked with parcels of chemicals and clean petroleum, but as with all the other routes out of the area, there is an adequate number of ships available to handle most requirements. Base oils have not been that noticeable, with the bulk of imports coming in from Asia and only the occasional shipment from Iran or Saudi.

Eastbound business has plenty of cargoes around, but equally plenty of ships and so rates are even soft. Cargoes such as paraxylene, pyrolysis gasoline, benzene, ethanol, linear alkyl benzene, paraffins, methanol, ethylene dichloride, glycols, butanols, acrylates, orthoxylene and styrene have been observed.

Westbound is sluggish and again an overcapacity of tonnage means that rates are weak. The only high point for owners is that a growing number of P&I clubs have indicated that they will cover chemical tankers for loading from Iran within the next month or two and so owners are making efforts to position ships into the area for that eventuality.

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 12 0750 7507. In the London office SSYs Ian Roberts can be reached atfix@ssychems.comor +44 20 7977 7560 and in Singapore Jordi Maymi at +65 6854 7127.