Brazil’s base oils imports fell to a four-month low in December, cushioning the impact of the country’s rising production and lower lube consumption.
The lower imports coincided with a drop in arbitrage shipments to the country from more distant markets like Asia-Pacific and Europe.
Shipments from the US to Brazil also fell in November to a thirty-month low.
The drop in shipments helped the country to avoid the kind of large supply-build that it faced in 2021.
Brazil’s base oils output fell and imports slumped in late 2021 and early 2022 to clear the surplus.
The avoidance of such a surplus at the start of this year should prevent a repeat of such moves.
Brazil’s base oils imports of 64,780mᶟ (57,380t) in December fell from 67,030mᶟ the previous month to the lowest since August, government data showed.
The slowdown in shipments cut Brazil’s total base oils imports to 849,150mᶟ in 2022. The volume fell from a record-high 1.11mn mᶟ in 2021 to a three-year low.
Imports exceeded the 100,000 mᶟ/month level six times in 2021.
They exceeded the 100,000 mᶟ/month level just once in 2022, in the month of October.
Imports got a boost that month from the arrival of supplies from Asia-Pacific and Europe.
The closure of the arbitrage from Asia-Pacific from the end of the third quarter curbed the shipment of any more such supplies.
There was little prospect of any more arbitrage cargoes from the region moving to Brazil early this year.
Brazil’s balanced supplies and a closed arbitrage from more distant markets raised the prospect of steady demand for and supplies from the US over the coming months.
Shipments from the US to Brazil already showed signs of rising strongly in December, with most of the supplies arriving in January.
