Styrene is on hold on eastbound transatlantic routes, with only one known fixture for July so far. Instead, there have been a variety of small parcels quoted, consisting of the same grades as those quoted last week, including a couple of base oil shipments of around 3,000 tons each, one of which is claimed done. There are also attempts to ship around 12,000 tons of base oils from the U.S. Gulf to West Africa. Rates are stable this week.

It has not been particularly active on the route to India and the Middle East Gulf. Traders are evaluating sending ethanol to India and the Middle East Gulf, but it is generally felt that these cargoes will ultimately be sourced from Brazil. So far, owners have been able to stop any rate erosion, but if the staple products of ethanol, ethylene dichloride and base oils do not move then there is a possibility rates will come down.

It has been a largely inactive week for shipments to the Caribbean, too. No new base oil movements have been detected. Instead, there are some requirements for caustic, tallow, yellow grease, ethanol, sulphuric acid and drilling fluid.

There is a bit more to report about southbound shipments to the east coast of South America than of recent weeks. Ethanol is beginning to be quoted into North Brazil, a trend that will probably last for the next couple of months. Paraxylene is also expected to ship into Brazil in even greater volumes, most of which will be sourced from the U.S. Gulf. A total of 30,000 tons of styrene was fixed from the U.S. Gulf to Manaus for June and July, with levels said to be in the $60s/t and $70s/t depending upon volume and loadport. Methanol also saw enquiries into Brazil and Argentina, and there is interest to supply caustic into Brazil from the U.S. Gulf. Only base oils seem not to be part of the mix this week.

Europe

Were it not for a slight increase in the amount of ethanol and FAME cargoes being worked, rates in the North Sea and Baltic region would have gone down even further. As it is, rates have dropped by 1/t-2/t since the end of May. Base oils continue to move out of the Baltic, but it would appear that a large proportion will end up in markets other than Northwestern Europe. Aside from the national strikes that are still set to continue in France, the remaining industrial action has mostly come to an end, which should see a resumption of normal trading patterns.

It has been sluggish heading southbound into the Mediterranean and a couple of prompt ships have been unable to find any cargo and are therefore slowly ballasting back into the Mediterranean. The start of the religious fasting period of Ramadan has caused business to subside into Turkey and North Africa. Some small spot requirements of base oils were quoted into the Mediterranean but it is not known yet if they managed to fix. Rates are soft, with levels from Rotterdam into Turkey being around $50/t for 5,000-ton parcels of base oil.

Northbound demand has been thin, which has prompted some charterers to attempt to achieve substantial reductions on freight, in some cases by as much as 50 percent. It is not thought that the new levels were done, but since the cargoes were apparently fixed there will likely have been some substantial discounting having taken place. Base oils are moving, but mostly in-house.

It is hoped that following a return to work at the French ports, inter-Mediterranean business will get back on track and the backlog of ships will clear. FAME and MTBE gas have been a little more active in the West Mediterranean, while more aromatics have been noted in the Central Mediterranean and East Mediterranean. Base oils remain very quiet out of the Black Sea, although several barges are known to have recently discharged a total of about 5,000 tons of base oils in Batumi, Georgia, from inland Russia, perhaps in readiness for some export shipments.

Firm fixing on the transatlantic route has been almost non-existent over the past week. Various traders have looked at paraxylene from the Baltic, Mediterranean and Antwerp-Rotterdam-Amsterdam across to the U.S., but only around 20,000 tons has been booked in total, with the rest either melting away or on hold. A possibility to ship toluene and xylene briefly appeared before disappearing again. Pyrolysis gasoline was tabled from the Black Sea, Mediterranean and Baltic, but again, nothing materialized. Wax, cumene, acetone, phosphoric acid and urea ammonia nitrate are about the only grades in contention right now. Base oils do not seem to be of interest. Rates have flattened a bit more, although should any of this demand actually firm up, there is a chance rates will bounce back.

Almost nothing going from Europe to the Far East has been quoted over the past week. Space is plentiful, but owners are unwilling to needlessly reduce rates without there being even the prospect of firm business, and so rates have stayed motionless.

A number of base oil possibilities from Europe to India and the Middle East Gulf have been presented over the course of the week, and it would seem that some of the East Mediterranean material may have been booked. There is also quite some demand for chemicals parcels as well as bigger lots of acid, pyrolysis gasoline, paraxylene, reformate and vegetable oil, yet nevertheless, rates remain soft due to the large number of potential carriers open in Europe.

Asia

Even Asias market has been unsettled to some extent by fears of a possible British exit from the EU causing a Black Friday. Spot market rates fell away this week, with rates losing the dollar they gained last week on the Korea-to-China routes. There is still quite a lot of late June business quoted around, including benzene, styrene and paraxylene, but there are still quite a large number of prompt candidates available.

There has been more southbound activity from Korea into South China, Thailand and Vietnam, and it has become harder to locate ships able to accommodate 1,000- to 2,000-ton parcels, which could cause rates to rise slightly.

It has been fairly busy northbound, especially with pyrolysis gasoline being quoted up from Anyer, Indonesia; Batangas, the Philippines; and from Map Ta Phut and Si Racha, Thailand. Base oils have also been noted, along with methanol, MTBE, styrene and paraxylene. A benzene haul of 6,000 tons from Thailand to mid China is reported to have gone in the high $20s/t, while 3,600 tons of pyrolysis gasoline from Thailand to mid China is reckoned to have fixed in the very low $30s/t.

Inter-Southeast Asia routes report patchy demand, with some owners still having prompt space while others are booked forward into July. Rates in general are soft, and even though there has been a slight increase in the number of 8,000- to 12,000-ton cargoes of clean petroleum, the rates that these cargoes achieve are around $30,000-$40,000 lower than usual.

It has been a quieter period for benzene export across the Pacific, but paraxylene activity is awakening instead. There should be space for June and July to the U.S., but the situation to Europe is much tighter, with virtually no space left until the end of July on the scheduled carriers, and only a limited amount of space from the outsiders. Rates have stabilized for now but may creep up from Korea. There is ample space from Southeast Asia.

Since the start of the Ramadan period, it has been much quieter out of the Middle East Gulf. Eastbound rates have dropped a dollar or two, and westbound rates may have gone down even a little more than that. There is plenty of tonnage in the region, and cargo prospects look dim.

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 Bergen office in Norway, SSYs Ian Roberts can be reached at fix@ssychems.com or +47 55 54 05 00 and in Singapore Jordi Maymi at +65 6854 7127.