Base oil imports to China were virtually flat at 2.81 million metric tons in 2018, according to data from the nations General Administration of Customs. That would account for roughly 45 percent of Chinas total base oil demand, based on a recent estimate of the size of its lubricant market.
The volume of imports that the Customs administration indicated for 2018 represented a 0.3 percent drop from the 2.82 million tons of base oil that the country imported in 2017. Domestic Chinese base oil capacity has steadily increased in recent years due to the opening of new plants and expansion of existing ones.
China consumed 7.4 million tons of finished lubricants, including process oils, in 2018, according to a presentation by Kline & Co. consultancys Annie Jarquin at the ICIS World Base Oils & Lubricants Conference in London last month. Assuming that base oil constituted an average of 85 percent of those lubricants, the market would have consumed approximately 6.3 million tons of base oil. China is one of the worlds two largest lubricant markets and has long been one of the largest base oil importers.
South Korea, Singapore and Taiwan remained the top three sources of base oil imports to China. South Korea, the largest base oil supplier in Asia, shipped about 1 million tons of base oils to China in 2018, mainly Group II and III oils from four major refiners, according to the customs administration. SK Lubricants, S-Oil, GS-Caltex and Hyundai and Shell Base Oil all operate Group II and III plants in that country.
Singapore, where ExxonMobil is the largest supplier, shipped around 720,000 tons of base oils to China. Major Chinese buyers included Nanjing-based Jiangsu Lopal Tech Co. and Beijing-based Tonyi Lubricants, two big private lube suppliers in China.
Taiwans biggest base oil producer, Formosa Petrochemical Co., known for its stable quality and supply of 150N and 500N base oils, has long been favored by many Chinese local lube blenders and trade companies, who collectively bought close to 300,000 tons of oils from Taiwan last year.
Other large source countries include Japan, Thailand, Qatar, the United Arab Emirates, Indonesia and Russia.
Base oil production inside of China has made a big shift from Group I to Group II oils, and the market now has a number of big Group II producers, including Sinopec, Shandong Qingyuan and Hainan Handi Sunshine Petrochemical.
China may be a big importer of base oils, but official statistics show hardly any going abroad. State-owned Sinopec said it shipped 2,000 tons of Group II base oils from its Maoming facility to Singapore last April. Sinopec operates a blending plant in Singapore, and the company has said it aims to build Maoming into its base oil supply hub for highly refined base oils.