Not Logged In, Login,

Friday, January 19, 2018


Slowdown in organic chemicals trade  -  Drewry

Drewry has estimated that organic seaborne chemical trade increased by 1.9% in 2000, which is much less than the 8.7% estimated growth in 1999 and also lower than the 3.7% growth reported in 1998. It appears that the U.S. market underpinned this growth in organics seaborne trade in 2000 with preliminary data showing exports up +9.2% and imports up +22.8%.

Japanese exports to South East Asia fell by an estimated 3% in 2000, while South Korea’s impressive export growth in 2000 was almost entirely due to increased trade within the Pacific region as it continued to make inroads with junior trading partners such as Indonesia, Hong Kong, Thailand, Malaysia and the Philippines.

In 2000, it is estimated that both exports (+9.3%) and imports (+19%) increased sharply as the South Korean economy continued to make progress. Notably, based on preliminary data, South Korea displaced Japan as the largest Pacific region exporter of organics for the first time in 2000.

Japan is a net exporter of organic chemicals. In 2000, according to Drewry, it is estimated to have exported 5.01 million tonnes and imported 2.99 million tonnes. Most of Japan’s exports are within the Far East. Taiwan, China (31%), South Korea (23%) and China (20%) are the main destination countries. Japan tends to look outside the Pacific region for its organic imports. By far the largest organic exporter to Japan is Saudi Arabia (37%) with New Zealand (27%), an important methanol supplier to the Pacific region, is the next largest.  USA (10%) is only the third largest exporter to Japan but (along with South Korea) supplies the most diverse range of organics.

North American oil use growing amid gloom - PIW

Despite prospects for an economic slowdown, oil demand is likely to be more robust in the US this year than it was last, EIG calculates. North American demand stagnated in 2000 on the back of weak, apparently price sensitive US gasoline consumption and the so-called “Y2K” effect, in which hoarding pulled deliveries back into 1999 from early 2000. The key to a stronger 2001 is the potential for durable strength in the consumption of heating oil and fuel oil.  EIG project US oil demand to increase by 2% in 2001 compared to projections of 1.4% by IEA and EIA. EIG project Canada’s oil consumption to increase by 2.1% and Mexico’s oil consumption to increase by 4.2% in 2001, resulting in a total North American increase in oil demand of 2.2%, compared to an IEA projection of 1.4%. (PIW19 March 2001)

US and Europe tighten fuel specs in tandem  -  PIW

Refiners on both sides of the Atlantic will face more stringent environmental specifications on gasoline and diesel by the middle of the decade. While the projected multi-billion-dollar bill for refinery upgrading is clearly bad news for the industry, it does appear that one feared side effect — further disruption of trade due to non-compatible standards — has been largely avoided as far as gasoline is concerned. In the US, the Environmental Protection Agency (EPA) has decided to proceed with a ruling crafted by the previous Clinton administration to cut the sulphur in diesel from 500 parts per million (ppm) to 15 ppm. The agency ruled in 1999 that sulphur in gasoline should be cut to 30 - 80 ppm beginning in 2006.

Under the European Union’s Auto Oil programme, refiners must cut sulphur in both gasoline and diesel to a minimum of 50 ppm, comfortably within the US range, and cut aromatics in gasoline to 35% by 2005, which is similar to the US aromatics standard. That both the US and Europe are proceeding at roughly the same pace could help maintain the transatlantic flow of gasoline. Refinery experts are confident that the new specs won’t create any real problems for trade.  Proposals to introduce 10 ppm fuels are still in the drafting stage in Brussels, but it looks as if initial talk of a gradual phase-in from 2007 will be rejected in favour of total compliance by 2011.

The story is a very different one for diesel. Both markets are already short of road-quality diesel, and industry groups predict that this can only get worse. US and European refiners will have to put in secondary desulphurisation capacity to process whatever quality imports they can get. At the moment, Europe makes up its gas oil balance from Russia, which has gas oil of a quality somewhere between heating oil and diesel in the EU and is generally desulfurized into diesel. The US takes most of its imports from Latin America. An American Petroleum Institute study concludes that US production of on-road diesel would fall 12% if the regulations were to go into effect, suggesting that imports — which already make up 5% of demand — would have to rise to make up the shortfall. A similar study by Europe found that diesel production (as auto oil) could fall by 20% if investments were not made. Europe starts from a much bigger diesel deficit than the US, making it unlikely that diesel would ever move west across the Atlantic in quantity. (PIW19 March 2001)