South Korea’s base oils exports slumped in September to the lowest in more than a decade as plant maintenance work cut supply.The slump in shipments forced buyers to tap existing stocks or to line up supplies from alternative sources.Total base oils exports of 237,600 tonnes in September fell from 428,700 tonnes the previous month, government data showed.The August volume was the highest in eighteen months and enabled buyers to replenish stocks ahead of a seasonal pick-up in demand from the end of the third quarter of the year.The September export volume was the lowest since mid-2013.The slump in shipments in September tightened availability in the Asia-Pacific market, where surplus supply had already fallen the previous month.The tight availability curbed any pressure on refiners to remove surplus volumes through arbitrage shipments to distant markets.The limited availability instead forced buyers in those more distant markets to seek supplies from other sources instead.Asia’s base oils prices reflected the tighter supply fundamentals.The premium of FOB NE Asia Group II heavy-grade prices over Singapore gasoil rose in September to the highest level in almost three years.The discount of Asia Group II heavy-grade prices to US export prices began to tighten in September, before moving this month to narrowest level since May.The smaller discount made the arbitrage to the Americas harder to work.The fall in South Korea’s exports in September included a drop in shipments to China to less than 20,000 tonnes. The volume was the lowest since at least 2010.The lower shipments coincided with a fall in Taiwan’s base oils exports to China in September. Singapore’s flows to China were relatively steady that month.Combined shipments of less than 60,000 tonnes from the three markets to China in September fell from close to 113,000 tonnes the previous month to the lowest in at least a decade.Shipments from the three markets accounted for more than 70% of China's total base oils imports in the first eight months of this year. The drop in shipments in September mostly reflected the slump in South Korea’s base oils supply.It also pointed to growing signs of a slowdown in China’s base oils demand for overseas supplies..Taiwan’s Sept base oils exports fall.China’s Sept base oils output rises
