China’s base oils output edged down in February for the first time in seven months, cushioning the impact of a slowdown in demand during the lunar new year holidays.Lower output coincided with a slump in base oils shipments from Taiwan to China in February and a slowdown in South Korea’s base oils exports to China the previous month.The drop in supply followed signs of a cautious round of stock-building in China ahead of the lunar new year holidays in first-half February.The country’s lube demand typically enjoys a seasonal boost after the lunar new year holidays.Firmer lube demand in March and more muted base oils supply in February raised the prospect of steadier buying interest over the coming weeks.China’s total paraffinic base oils output of around 440,000t in February fell from close to 470,000t the previous month, OilChem China data showed.The volume was still the third highest in the last twenty-five months.Output alone also exceeded China’s output and imports combined of almost 450,000t in February 2023.The trend highlighted China’s shrinking requirements for overseas supplies even with a revival in the country’s lube demand.A less feasible arbitrage to move Group II shipments from Asia to China highlighted that trend, ICIS data showed.The premium of China’s domestic Group II light-grade base oils prices over fob Asia cargo prices held in early March at its narrowest in more than two months.The trend contrasted with a widening premium of domestic Group II prices over fob Asia prices during the same period last year.The impact of China's seasonal pick-up in lube consumption beyond the country was duly more muted.Even so, signs of more cautious stock-building in China raised the prospect of more frequent moves to replenish those stocks. Less elevated prices compared with last year curbed the incentive for domestic refiners to raise output further. Plant maintenance work in March was also set to curb domestic output. Steady demand and the prospect of lower supply could in turn support firmer interest in overseas shipments over the coming weeks..S Korea’s January exports stay higher.China’s January base oils output rises
China’s base oils output edged down in February for the first time in seven months, cushioning the impact of a slowdown in demand during the lunar new year holidays.Lower output coincided with a slump in base oils shipments from Taiwan to China in February and a slowdown in South Korea’s base oils exports to China the previous month.The drop in supply followed signs of a cautious round of stock-building in China ahead of the lunar new year holidays in first-half February.The country’s lube demand typically enjoys a seasonal boost after the lunar new year holidays.Firmer lube demand in March and more muted base oils supply in February raised the prospect of steadier buying interest over the coming weeks.China’s total paraffinic base oils output of around 440,000t in February fell from close to 470,000t the previous month, OilChem China data showed.The volume was still the third highest in the last twenty-five months.Output alone also exceeded China’s output and imports combined of almost 450,000t in February 2023.The trend highlighted China’s shrinking requirements for overseas supplies even with a revival in the country’s lube demand.A less feasible arbitrage to move Group II shipments from Asia to China highlighted that trend, ICIS data showed.The premium of China’s domestic Group II light-grade base oils prices over fob Asia cargo prices held in early March at its narrowest in more than two months.The trend contrasted with a widening premium of domestic Group II prices over fob Asia prices during the same period last year.The impact of China's seasonal pick-up in lube consumption beyond the country was duly more muted.Even so, signs of more cautious stock-building in China raised the prospect of more frequent moves to replenish those stocks. Less elevated prices compared with last year curbed the incentive for domestic refiners to raise output further. Plant maintenance work in March was also set to curb domestic output. Steady demand and the prospect of lower supply could in turn support firmer interest in overseas shipments over the coming weeks..S Korea’s January exports stay higher.China’s January base oils output rises
