Thailand’s October base oils exports fall

Thailand’s base oils exports fell in October when both the country’s base oils plants underwent shutdowns for maintenance work.

The drop in shipments added to a growing trend of lower base oils exports from the Asia-Pacific region’s key base oils producers, especially compared with September.

Regional supplies fell because of a combination of plant maintenance work, lower run rates and more balanced supplies that curbed producers’ pressure to move shipments.

More balanced fundamentals and steadier regional base oils prices also reduced their urgency to sell.

But the size of the drop in Thailand's October shipments was more muted compared with periods of maintenance work earlier this year.

Exports of 13,530 kilolitres (11,990t) in October slumped by almost half from 26,800kl the previous month, government data showed.

The September volume had been the highest in a year and up from less than 3,700kl in August.

Exports had got a boost as refiners moved to clear a growing surplus that had built during the third quarter of the year.

The October volume was still down from typical levels of more than 16,000 kl/month over the past year. But it was higher than in June, when base oils output dipped because of partial plant maintenance work.

The relatively steady flows limited any upward pressure on regional Group I base oils prices. They were also sufficient to cover regional demand.

The shipments helped to meet a cautious pick-up in China’s demand for supplies like Group I bright stock.

Exports of 2,910kl to China in October fell from 7,400kl the previous month. Before September, there had been no shipments to China since May.

There were signs of more shipments moving to China in November.

But the re-imposition of widespread lockdowns in China in recent weeks raised the prospect of halting the country’s recovery in buying interest.

Exports of 9,850kl to Singapore in October were higher than typical volumes over the past year.

The firm volumes coincided with a dip in the city-state’s base oils exports from domestic sources in October to the lowest in more than a year.

Such a slowdown in shipments previously often coincided with factors such as plant maintenance work.