Brazil’s base oils supply lagged demand in June, trimming inventories at the start of the Atlantic hurricane season.Total supply, or domestic output and imports combined, fell to 107,000 cubic meters (95,000 tonnes) in June, government data showed.The volume fell from 137,000 cubic meters the previous month to the lowest since last September.Lower supply contrasted with firm demand levels at around 118,000 cubic meters in May and June.The subsequent supply shortfall was the first in nine months.Moves to replenish lower stocks could be more complicated because of tighter base oils supply in the US.Supply in that market tightened in recent months partly because refiners and distributors sought additional volumes as a buffer against any weather-related supply disruptions during the third quarter of the year.The drop in Brazil’s base oils inventories left that market more exposed to any such disruptions and incentivized buyers to eye alternative sources of supply.Any rise in domestic base oils output was likely to be limited, with production already at relatively firm levels.Output of 51,900 cubic meters in June already rose from less than 45,000 cubic meters in May, government data showed.The volume was also up from average levels of close to 50,000 cubic meters in first-half 2023, before a heavy round of plant maintenance work in the second half of last year.The prospect of limited extra supplies from domestic refiners boosted the need for more shipments from overseas markets in addition to the US.A rise in supplies from other markets would also cushion against Brazil’s growing reliance on shipments from the US.The country’s base oils imports of 55,500 cubic meters in June fell from more than 92,000 cubic meters in May to a nine-month low.The country’s high import volumes in the first five months of this year coincided with a rise in the share of shipments that originated from the US.Brazil’s base oils supply shortfall in June highlighted the risk of that growing reliance on shipments from the US..Brazil’s June lube demand extends rise.US’ May base oils exports to South America rise
Brazil’s base oils supply lagged demand in June, trimming inventories at the start of the Atlantic hurricane season.Total supply, or domestic output and imports combined, fell to 107,000 cubic meters (95,000 tonnes) in June, government data showed.The volume fell from 137,000 cubic meters the previous month to the lowest since last September.Lower supply contrasted with firm demand levels at around 118,000 cubic meters in May and June.The subsequent supply shortfall was the first in nine months.Moves to replenish lower stocks could be more complicated because of tighter base oils supply in the US.Supply in that market tightened in recent months partly because refiners and distributors sought additional volumes as a buffer against any weather-related supply disruptions during the third quarter of the year.The drop in Brazil’s base oils inventories left that market more exposed to any such disruptions and incentivized buyers to eye alternative sources of supply.Any rise in domestic base oils output was likely to be limited, with production already at relatively firm levels.Output of 51,900 cubic meters in June already rose from less than 45,000 cubic meters in May, government data showed.The volume was also up from average levels of close to 50,000 cubic meters in first-half 2023, before a heavy round of plant maintenance work in the second half of last year.The prospect of limited extra supplies from domestic refiners boosted the need for more shipments from overseas markets in addition to the US.A rise in supplies from other markets would also cushion against Brazil’s growing reliance on shipments from the US.The country’s base oils imports of 55,500 cubic meters in June fell from more than 92,000 cubic meters in May to a nine-month low.The country’s high import volumes in the first five months of this year coincided with a rise in the share of shipments that originated from the US.Brazil’s base oils supply shortfall in June highlighted the risk of that growing reliance on shipments from the US..Brazil’s June lube demand extends rise.US’ May base oils exports to South America rise
