Brazil’s base oils supply held in a narrow, lower range in September amid steady domestic production and imports.
The volumes continued to trend lower from year-earlier levels in the face of a steady slowdown in domestic lube demand.
Base oils output of 50,930mᶟ (45,110t) in September fell from 52,640mᶟ the previous month and for a tenth straight month from year-earlier levels, government data showed.
Except for a dip in June and July, production mostly held in a 48,000-52,000 mᶟ/month range since last November.
Output had previously risen as high as 73,160 mᶟ/month in the previous four months to last October.
The higher production levels had coincided with a surge in base oils imports and the start of a sustained slowdown in domestic lube demand.
The trend left Brazil with a large surplus that it had to clear at the start of this year.
Base oils imports also trended lower this year.
Shipments of 71,450mᶟ in September rose from 64,310mᶟ the previous month. They still fell for a third month from year-earlier levels.
The downward trend cut total base oils output and imports combined to 1.02mn mᶟ in the first nine months of the year. The volume was down 28pc from 1.42mn mᶟ during the same period last year.
The size of the drop in supply was unusual in view of the smaller fall in demand.
It also contrasted with other markets in the region like Argentina. That country’s base oils output also fell sharply this year.
But its imports almost fully made up the shortfall as buyers locked in lower-priced supplies from overseas markets like Mideast Gulf.
