Exports rise on strong shipments to India, surge in flows to US
Imports fall to five-month low on pause in shipments from Europe
Changing trade flows follow start-up of new Group II unit in Q3
Singapore’s base oils exports rebounded in November, driven by strong shipments to India and an unusual surge in flows to the US.
Rising exports contrasted with a dip in imports to a five-month low following a pause in shipments from Europe.
The shift in flows pointed to changing regional and global trade dynamics following the start-up of a new Group II unit in Singapore at the end of the third quarter.
Key highlights:
· Total exports rose to 184,300 tonnes, up from 167,400 tonnes in October and above the past year’s typical monthly average of around 171,500 tonnes, government data showed.
· Exports from domestic producers rose to the second-highest level in eight months, pointing to rising availability following the start-up of the new unit.
· The highest level during that period was in September, when the new unit began operations.
· Exports of more than 10,000 tonnes to the US were the highest since June 2020.
· The surge followed an almost-complete pause in shipments to the US over the previous two years, signalling a notable shift in trade flows.
· Exports to India rose above 40,000 tonnes for just the third time in the past sixteen months.
· The rise in exports contrasted with a dip in South Korea’s shipments to India in November.
· Exports to southeast Asia remained firm.
· Exports to China fell to a four-month low, in line with the seasonal slowdown in the country’s demand at year-end.
· Imports from Europe paused for the first time in five months, following heavy inflows from the region in the four months to October.
Market impact:
Global base oils trade flows are set to change following the start-up of Singapore’s new Group II plant, including production of a heavy-grade base oil that can serve as a substitute for Group I brightstock in many applications.
The resumption of Singapore’s exports to the US, combined with the pause in European shipments to the island-state, could represent an early signal of those structural changes.