SSY Base Oil Shipping Report


The U.S. market has seen a slight upturn in demand, whereas Europe is merely treading water. Asia, inundated with open tonnage during a period of slack demand, is not making progress.

U.S. Gulf

Demand into Asia has improved, causing freight levels to gently rise. Styrene is behind much of it. China had muttered that it would impose an anti-dumping duty on Korean styrene, which stimulated interest in U.S. material instead. Several cargoes of paraxylene have been booked to China, with more pending. At least two cargoes of phenol – around 6,000 tons each – were fixed at around $60 per metric ton. Ethanol is more active too, and there have been inquiries for glycol, butanol and ethylene dichloride. Base oil interest can only be accounted to majors feeding their own systems.

On the eastbound route, there have been more possibilities for owners to work. Styrene is included, but with priority given to Asia, there may not be too much that ends up fixed into Europe. Rates for 5,000-ton parcels are in the high $40s to $50/t region.

A haul of 3,000 tons of monoethylene glycol was booked from Port Neches, U.S., to Antwerp, Belgium, in the mid $50s/t. Cumene in the amount of 6,000-8,000 tons followed from Houston, as an earlier effort to ship from Corpus Christi produced no workable ships.

Several cargoes of ethanol have been booked, and there have been further movements of ethylbenzene, turpentine, tall oil and biodiesel. Base oils are receiving attention from traders, with small parcels of 2,000 to 3,000 tons quoted to Antwerp-Rotterdam-Amsterdam and some larger volumes to Lagos, Nigeria.

The Caribbean is not hugely exciting as a destination market, yet most ships are employed. A prompt requirement for easy chemicals from the U.S. Gulf into Mexico found very little tonnage able to load in June. Eleven-thousand tons of caustic from the U.S. Gulf to Matanzas, Cuba, remains uncovered. Other small parcels of caustic into the Caribbean are known to have been booked.

Significant amounts of ethanol continue to move to the east coast of South America. Rates are up a little too. For example, 10,000 tons of ethanol from Mississippi were heard fixed at $525,000. Styrene totalling 10,000 tons to Munguba has yet to be fixed, and traders have been looking at paraxylene into Suape. Base oils amounting 8,000 tons were heard fixed from Pascagoula to Santos and Rio de Janeiro, along with a further 7,000 tons from Houston to Rio de Janeiro for others.

Ethanol has been moving from the U.S. Gulf to India, but rates are under pressure due to the amount of space. A load of 20,000 tons was heard to have gone at just $47/t. Base oils seem quiet for now.


It appears that contractual volumes in the North Sea and Baltic Sea may be down a touch, which could help explain why a couple of regular owners have been left with prompt space. On the whole, the spot side of things has been reasonably busy, with a good spread of products needing to be lifted, and cargoes on most routes. The mood among owners, though, is that they feel they must grab what they can at almost any level. Base oils have seen a mixture of movements into and out of the Baltic.

Southbound demand has been fairly decent through the week, and most of the ships that were open with prompt space are now fixed. Cargoes fixed include ethylene dichloride, acetic acid, acrylonitrile, ethanol, styrene, paraxylene, orthoxylene, biodiesel and aviation gasoline, as well as some base oils.

In northbound trade, contractual volumes have been sustained to the extent that some owners have had to relinquish fixing spot business in order to ensure their ships are on time for contractual partners. Benzene has been quoted from Lavera, France, and Tarragona, Spain, while pyrolysis gasoline has been pushed from a couple of Italian ports. Routine cargoes of base oil, caustic and biodiesel have helped fill some of the open tonnage.

Prompt space is not that plentiful in the West Mediterranean, probably because biodiesel demand has picked up substantially. Probably every third spot cargo is biodiesel right now. Caustic has been more active from Lavera following a recent turnaround. All Islamic countries in the Mediterranean region have been closed for business for the period of Eid, meaning that some areas have been slow on the cargo front.

Transatlantic business remains subdued on the westbound route, with a number of vessels around on similar dates. For 5,000-ton parcels from Rotterdam to Houston, owners are talking rates in the mid- to high $20s/t, which is why it is surprising that 4,000 tons of solvents from Antwerp to Houston were provisionally booked in the high $40s/t. Several traders have been looking at pyrolysis gasoline. Others quoted 5,000 tons of paraxylene from Rotterdam to the U.S. Atlantic Coast, and there is interest in sending sulphuric acid across from Aviles, Spain. Base oils in the amount of 6,000 tons from Antwerp to Houston were covered at $34/t, but it is a fixture from the week before.

There really has been so little quoted into Asia on the spot market that the scheduled carriers are having it all their own way and are able to stop freight rates from falling. Base oils have been completely absent.

Fewer small parcels of aromatics and solvents have been seen to India and the Middle East Gulf this week, and base oils have been slow too. Mixed xylenes in the amount of 15,000 tons were attempted from Antwerp to Sikka, India, for mid-July, although the June requirement was booked out of Korea, and the same is likely to occur in July.


There is very little joy to be felt in regional Asia markets. Owners must feel immensely oppressed because every report says the same thing: Demand is poor, space is plentiful, and rates are under pressure. Ships are rarely idle for long, but owners do have to really be creative when it comes to finding cargoes, and in many cases ships will be required to ballast for their next employment. It is a small wonder that freights are under great pressure currently.

Easy chemicals amounting to 6,000 tons from Korea to mid China are pegged at around $15/t presently, with 3,000-ton parcels going in the low $20s/t.

In Southeast Asia, there is a little more palm oil around for ships with the right last cargoes, and there has been some more clean petroleum activity in the small sizes.

Several cargoes of benzene have been fixed to the U.S. Gulf from Korea and Japan. Initial reports suggest rates for the 9,000-ton parcels are in the low- to mid $30s/t, which are lower than levels in June. It is the prospect of more cargo in July that has prompted owners to put more ships on berth, which has rather ironically caused rates to dip. If the cargoes do not materialize, then not all the ships will necessarily go on berth. Not all these ships are willing to take base oils either, due to subsequent cargo commitments. In comparison, a ship has just sailed from Rayong, Thailand, for instance, with 4,000 tons of base oils for the U.S. Gulf, and the rate is said to be around $110/t, though that number has not yet been fully verified.

The market into Europe remains largely tight on space.

The entire regional market has been running at a very slow pace due to the Eid holidays. India also had some public holidays this week, and the monsoons have reached ports such as Jawaharlal Nehru and Kandla, where lengthy berthing delays have been reported.

Adrian Brown is a senior market analyst for chemicals and base oils with SSY Shipbrokers, London, can be reached atfix@ssychems.comor +44 12 0750 7507. Information about SSY can be found In the Houston office,Steve Rosenthalof SSY’s Chemical Tanker Department can be reached directly at +1 (713) 652-2700 and Jordi Maymi in Singapore can be reached at +65 6854-7127.

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