South Korea’s base oils exports slumped in June despite the lack of any scheduled plant maintenance work that month.Exports fell well below levels in March and April, when a major Group III unit was offline for maintenance work.Shipments instead fell to the lowest since July 2023, when maintenance work was taking place on a key Group II unit in the country.The size of the fall in shipments in June pointed to steep run-cuts or to stock-building or to a combination of the two.Asia’s base oils margins trended higher in April and May 2024, curbing the attraction of run-cuts.Refiners’ production plans for June were likely already finalized well before base oils margins fell that month.Any moves to cut run-rates suggests that refiners instead based their decision on other factors such as weaker demand in markets like China and India.The price spread between base oils prices in those markets and FOB Asia prices narrowed steadily during the two months to end-May.South Korea’s base oils exports of 272,300 tonnes in June fell from almost 405,000 tonnes the previous month, government data showed.The May volume was the highest in seven months and followed the restart of a Group III plant in second-half April after scheduled maintenance work.The large export volume in May could have added to the size of the fall in June exports if refiners moved to maximise shipments in May to cut their inventories in response to weaker demand in outlets like China.Exports of 32,400 tonnes to China in June fell from more than 48,000 tonnes in May to the lowest in eleven months.The slowdown mirrored a steep drop in shipments from Taiwan to China in June. Exports from Singapore to China also showed signs of slowing that month.The drop in exports coincided with a fall in China’s own domestic base oils output in June, partly because of plant maintenance work in the country.The likely drop in China’s total supply in June coincided with still-cautious demand in the country.Even so, the simultaneous fall in domestic output and in supplies from key regional refiners could have exceeded expectations.China’s domestic Group II base oils price premium to FOB NE Asia prices began to trend higher from end-May, then extended their recovery so far this month.The growing premium began to make the arbitrage more feasible, pointing to firmer demand for overseas shipments to top up domestic supply. .China’s June base oils output falls.Taiwan’s June base oils exports fall
South Korea’s base oils exports slumped in June despite the lack of any scheduled plant maintenance work that month.Exports fell well below levels in March and April, when a major Group III unit was offline for maintenance work.Shipments instead fell to the lowest since July 2023, when maintenance work was taking place on a key Group II unit in the country.The size of the fall in shipments in June pointed to steep run-cuts or to stock-building or to a combination of the two.Asia’s base oils margins trended higher in April and May 2024, curbing the attraction of run-cuts.Refiners’ production plans for June were likely already finalized well before base oils margins fell that month.Any moves to cut run-rates suggests that refiners instead based their decision on other factors such as weaker demand in markets like China and India.The price spread between base oils prices in those markets and FOB Asia prices narrowed steadily during the two months to end-May.South Korea’s base oils exports of 272,300 tonnes in June fell from almost 405,000 tonnes the previous month, government data showed.The May volume was the highest in seven months and followed the restart of a Group III plant in second-half April after scheduled maintenance work.The large export volume in May could have added to the size of the fall in June exports if refiners moved to maximise shipments in May to cut their inventories in response to weaker demand in outlets like China.Exports of 32,400 tonnes to China in June fell from more than 48,000 tonnes in May to the lowest in eleven months.The slowdown mirrored a steep drop in shipments from Taiwan to China in June. Exports from Singapore to China also showed signs of slowing that month.The drop in exports coincided with a fall in China’s own domestic base oils output in June, partly because of plant maintenance work in the country.The likely drop in China’s total supply in June coincided with still-cautious demand in the country.Even so, the simultaneous fall in domestic output and in supplies from key regional refiners could have exceeded expectations.China’s domestic Group II base oils price premium to FOB NE Asia prices began to trend higher from end-May, then extended their recovery so far this month.The growing premium began to make the arbitrage more feasible, pointing to firmer demand for overseas shipments to top up domestic supply. .China’s June base oils output falls.Taiwan’s June base oils exports fall