Indonesia’s Group III base oils exports stayed unusually low in January for a sixth month, extending a sharp slowdown in shipments to Europe.The country’s base oils exports typically exceed 27,000 t/month. They averaged little more than half that level since the third quarter of last year.The sustained slowdown coincided with Group III plant maintenance work in the Mideast Gulf and Europe in the final months of last year. It coincided with a slump in Group III shipments from South Korea to Europe at the start of this year..S. Korea's Jan exports to Europe slump.The fall in supplies countered the impact of an economic and seasonal slowdown in consumption in Europe and to a lesser extend in the US.Group III base oils supply in Europe especially remained tight and prices at much firmer levels than Group I and Group II base oils during the first two months of this year.There were signs of a pick-up in Group III base oils shipments from Indonesia in February, including to Europe. The arrival of additional supplies to Europe in March would coincide with a seasonal rise in demand in the region.Indonesia’s Group III base oils exports of more around 13,500t in January rose from 11,000t the previous month, government data showed..The volume was the second lowest in five months and down by more than half from year-earlier levels.The country's base oils exports typically dip because of factors like plant maintenance work. The slowdown this time suggested other factors like refinery run-cuts.The sustained fall in shipments had the biggest impact on supplies bound for Europe and the US.Exports of less than 3,000t to the Netherlands in January improved from the previous month, when there were no shipments. But they were down from typical levels of close to 10,000 t/month.An unusual pause in Group III base oils shipments from South Korea to Europe in January compounded the slump in supplies from Asia-Pacific.Base oils exports to South Korea rose to a four-month high of around 8,000t in January. A large portion of supplies bound for South Korea then move on to the US.Before the third quarter of last year, exports to South Korea typically exceeded 15,000 t/month.Exports fell despite strong demand and high prices for Group III base oils in the US.Base oils exports of 2,500t to China in January fell from 4,000t the previous month.But the volume was similar to typical exports of around 2,700 t/month to the country.Flows to China stayed relatively steady despite the slump in the country’s lube demand last year.The prospect of a revival in China’s lube demand this year could trigger a rise in shipments to the country.Indonesia’s base oils exports would need to rise, or shipments to other markets would need to fall, to accommodate such a development..China’s February base oils output falls
