This makes it hard for those owners who do have ships destined for discharge in the U.S. Gulf over the next week to ten days. Should they stay in the area? With the way the U.S. Gulf-to-Caribbean and Mexico market is at the moment that could be unwise. This mini market is well serviced by scheduled tonnage which already has gaps due to poor contractual demand.

U.S. Gulf-to-Brazil is one alternative, and we have heard of 5,000 to 6000 cubic meter cargoes of ethanol from Houston to northern Brazil which achieved mid $50s/t. However, there is space available to scheduled ports which will accept levels of high $30s/t for 5,000 tons. The question for the owners is whether there is sufficient cargo to the unscheduled ports.

Eastbound transatlantic has been active, and there have been a number of enquiries for benzene, styrene, cyclohexane, ethanol and vegetable oils to Europe. Moreover, apart from a small amount of epoxy space, and a couple of ships open right up in New York Harbor, there is not much open space to Europe in the first half of August. However, many of the cargo possibilities are no more than that, so it is a risk to commit a larger ship for only a part-cargo.

U.S. Gulf-to-Far East is not a viable option. Demand remains poor and there is more than sufficient tonnage available, keeping rates down in the low-to-mid $40s/t for a 5,000 ton cargo from the U.S. Gulf to principal Far East ports.

Europe
It has been a busy week again in Northwest Europe and the Baltic, at least in terms of contractual volumes. What that does mean is that there are fewer ships around to chase spot market business, but such is the state of the market nowadays that even if the regular owners are unable to offer on cargoes there are always sufficient outsiders around able to offer on most prompt cargoes.

Rates within Europe therefore remain highly competitive. The same applies to the Mediterranean, where maybe half the fleet is booked ahead into mid or the second half of August since the rest of the fleet is invariably open within the next day or two.

Transatlantic westbound sees a steady trade in pyrolysis gasoline, naphtha and caustic, but demand is easily matched by the supply of ships, keeping rates in the region of $30/t for 5,000 ton cargoes from Rotterdam to Houston.

Europe-to-Far East is horribly quiet, and there are four or five scheduled ships with space. Rates continue to look weak, with 5,000 ton cargoes from Rotterdam to principal Far East ports fetching mid-high $60s/t. Europe-to-India and the Middle East Gulf can muster a number of pyrolysis gasoline, phosphoric acid, vegetable oil and acrylonitrile enquiries, but a plentiful supply of vessel space keeps rates in the mid-high $60s/t for 5,000 ton cargoes from Rotterdam to Mumbai.

Asia
Asian domestic markets have seen a surge of new enquiries in the 2,000 to 5,000 ton range, mostly into China, but also north and southbound too. The majority of enquiries are for aromatics such as paraxylene, orthoxylene, solvent naphtha C9, styrene and pyrolysis gasoline, with a few larger cargoes among them such as components for gasoline-blending. Rates are generally unchanged within the region.

Exports have faltered a bit, the benzene arbitrage closing into Europe and the United States. We still see enquiries for large cargoes of sulphuric acid to Chile, Brazil and the U.S. Gulf, and there are a number of palm methyl ester cargoes around, even for loading in September which is when the cargoes tend to disappear due to the onset of cooler weather in Europe. (PME is not popular in winter due to its poorer cold weather properties.)

Demand for palm oil has increased further, with rates from the Malacca Straits to the west coast of India climbing into the mid-to-high $20s/t for 10,000 to 12,000 ton cargoes. Similar cargoes to Rotterdam can now cost mid $70s/t.

Business out of India and the Middle East Gulf is still busy both west and eastbound. Quite a lot of enquiries emanate from Iran however, probably in response to the sanctions against Iran, as such cargoes should probably be transported on contractual tonnage. As more owners refrain from performing Iranian business then we can expect to see more of these cargoes in the market. Initially, rates seem to be going up, especially into Europe. We will have to see if this is because owners are not sending as many ships into the region as before, but at some point those ships are going to have to find a home somewhere.

Adrian Brown is senior market analyst for chemicals and base oils with SSY Shipbrokers, London. Information about SSY can be found at www.ssyonline.com. Adrian Brown, in the U.K., can be reached directly at research@ssy.co.uk or by phone at +44 1207-507507. In the U.S., SSYs Steve Rosenthal can be reached at fix@ssychems.com or +1 203-961-1566.