Japan’s base oils exports fell in July to the lowest in more than a decade as steadier domestic consumption left dwindling surplus supply available for overseas markets.The drop in shipments coincided with plant-maintenance work in Thailand and a slowdown in exports from Singapore and the Middle East.Availability of Group I base oils in the Asia-Pacific market tightened in response.Tighter supply and increasingly firm Group I base oils prices relative to other grades boosted the incentive and need for blenders to use more of those other grades instead.Japan’s base oils exports came to 18,400 kilolitres (16,300 tonnes) in July, government data showed..Exports edged down from 19,000 kilolitres in June to the lowest level since at least 2008.Japan’s shipments to overseas markets previously averaged more than 31,000 kilolitres/month in 2024 and close to 50,000 kilolitres/month in 2023.Exports tumbled in recent years following the closure of several Group I base oils units in Japan, combined with regular maintenance-work on the country’s remaining plants..Japan’s steadier domestic base oils consumption in June and July absorbed more of the country’s supply, compounding the drop in exports.Domestic consumption of 159,400 kilolitres in July was almost the same as output of 159,900 kilolitres.The 99.7% share of consumption relative to output rose from an already-high 97.5% in June and from more typical levels of around 81% of output in the year to May.Any extension of Japan’s steadier demand raised the prospect of keeping the country’s base oils exports lower for longer.A seasonal slowdown in demand in Asia in the month of August cushioned the impact of lower Group I exports from Japan as well as from other sources that supply the region.Even so, the drop in shipments added to concern about blenders’ ability to secure regular and sufficient Group I base oils supplies to cover requirements.Concerns about availability of supply of Group I base oils contrasted with increasingly plentiful availability of Group II base oils.The diverging trends boosted the incentive to use more Group II base oils instead. .S Korea’s July base oils exports stay low.Japan’s June base oils supply lags demand.Base Oil News stories and analysis also available on ICIS platform
