Tampa: With the calendar edging toward the fourth quarter, discussion regarding the state of the domestic molten sulfur market began to gather steam.
Talk tended to focus on the Tampa supply landscape. Viewpoints varied between short-to-balanced and balanced-to-long, and some observers focused attention on an expected dearth of molten imports to the U.S., including reduced cargoes from Mexico.
“I understand that outside of (an 80,000 mt cargo) they did early in the year, Mexico will not be coming anymore this year,” said one source. “(The market) will not be getting anywhere close to the normal 300,000-400,000 mt volumes.”
Canadian imports are also down from previous years, sources claimed. With netbacks to Alberta producers quoted as low as (-)$55/mt FOB in the second quarter, the additional $5/lt FOB third-quarter Tampa price cut prompted many sellers to redirect product offshore via Vancouver.
“(The difference) is over $20/mt alone on the currency exchange, then Vancouver pricing is roughly another $10/mt premium to that of the Tampa index,” one market player argued.
Combating the lower import numbers, one major sulfur consumer was said to have imported 10 cargoes of formed sulfur so far in 2016, with expectations that the material would be processed into molten form for use in phosphate production. The loads ranged in size from 5,000-55,000/mt, sources confirmed.
The third-quarter contract price of molten sulfur delivered to Tampa was $65/lt.
Domestic refinery utilization fell last week, according to the U.S. Energy Information Administration (EIA). The EIA logged capacity at 92.9 percent for the week, a 0.8 percent decline from the prior week’s 93.7 percent and also trailing the year-ago 93.1 percent, but ahead of the 92.1 percent five-year average.
The EIA data also revealed reduced daily inputs. Refiners processed an average 16.730 million barrels/d of crude for the week, a decline of 200,000 barrels/d from the previous week’s 16.930 million barrels/d.
U.S. Gulf: The Saudi Arabian Oil Co. (Aramco) has entered a bid to buy the LyondellBasell Ind. refinery located at Houston, Texas, according to multiple reports. Estimates put the refinery’s value near $1.5 billion, although Aramco’s offer price was not immediately made public.
Some observers previously speculated that Aramco would bid for the 268,000 barrel/d facility through Motiva Enterprises, a corporate partnership co-owned by Aramco and Royal Dutch Shell Plc. Shell and Aramco had earlier announced plans to dissolve Motiva in 2016, however, casting doubt on reports of a new acquisition by that entity.
The sale comes amid a string of unplanned shutdowns at the facility in 2016. Most recently, a system-wide power failure cut production on Sept. 1, and reports described a 91,000 barrel/d vacuum distillation unit breakdown on Sept. 13, which was reportedly caused by a pump failure.
An “unplanned compressor shutdown” at ExxonMobil Corp.’s Baytown, Texas, refinery triggered a brief work stoppage and flaring last week, according to an Exxon filing with the Texas Commission on Environmental Quality. The event lasted approximately six hours, with minimal effect on production. The second-largest refinery in the U.S., Baytown has a stated capacity of 568,000 barrels/d.
Sulfur exports rose for July, according to data released by The Fertilizer Institute (TFI). Offshore sales were recorded at 223,948 st, a 120 percent increase from the year-ago 101,910 st.
Formed sulfur sold from the Gulf was called $60/mt FOB, unchanged from the previous report.
Vancouver: Last-done on the Vancouver spot market continued to run $65-$70/mt FOB for the week, traders said. Chinese spot was also unmoved at $81-$82/mt CFR.
Alberta netbacks were quoted steady at (-)$55-$20/mt FOB.
West Coast: West Coast prills were called $60-$65/mt FOB. Third-quarter molten contracts ran $50-$75/lt FOB, sources said.
ADNOC: The Abu Dhabi National Oil Co. price for September loading was quoted at $77/mt FOB Ruwais, a $7/mt increase from the August price of $70/mt FOB.
Aramco: Saudi Aramco offered tons at $74/mt FOB Jubail for September, $8/mt above the previous month’s $66/mt FOB.
Tasweeq: Solid sulfur produced and sold from Qatar was listed at $74/mt FOB Ras Laffan for the current month, $9/mt higher than Tasweeq’s official price of $65/mt FOB for August.