Taiwan’s base oils exports fell to a seven-month low in August even amid steady flows to key outlets like China, southeast Asia and India.Exports instead slowed to more regular outlets for spot supplies such as the Middle East.The dynamic pointed to steady demand from term buyers in Asia, a slowdown in buying interest for spot shipments and the subsequent need to target other outlets for those supplies.A cargo was duly lined up to move to the Netherlands..Taiwan’s total base oils exports of 43,800 tonnes in August were the lowest since January, government data showed.The volume fell from more than 51,500 tonnes in July, which was well above typical levels of 45,600 tonnes/month during the previous twelve months..The higher July volume pointed to moves to boost shipments and cut stocks ahead of a lull in activity in the month of August.Lower stocks cut any urgency to move supplies and to make any sharp price adjustments in response.A steady flow of shipments to regular buyers reduced further any pressure on stocks and prices.Exports to China, southeast Asia and India combined held in a narrow range in August even as they edged up to a four-month high..Taiwan's total exports instead fell because of a slump in shipments to markets like the Middle East and Pakistan.There was a pause in Taiwan’s exports to the UAE in August for the first time in four months.The pause followed a surge in base oils exports from Asia to the Middle East in July.The rise in shipments left that market with brimming stocks and a subsequent slowdown in demand for additional supplies.A shrinking number of outlets to clear surplus volumes can put pressure on refiners to make large price adjustments to make the arbitrage work to more distant outlets.The steep premium of Europe’s Group II base oils prices relative to prices in Asia curbed the need for any such large adjustments.A cargo consisting mostly of Group II heavy grades duly loaded from Taiwan in early August before heading to the Netherlands. It is set to arrive in early October..US July base oil exports to Europe stay low.Global base oils exports to Middle East rise in July .Taiwan’s July base oils exports rise.Base Oil News stories and analysis also available on ICIS platform
