Tampa:
Major sulfur consumers completed negotiations with suppliers for an updated Tampa molten sulfur contract, agreeing to a price of $140/lt, up $19/lt from the previous $121/lt contract.
Sources attributed the increase to widespread sulfur tightness in both the U.S. and international markets, leading to timely price increases at China, Brazil, and the U.S. Gulf – all key indicators for Tampa.
Unsteady production at Canada and Mexico overwhelmed strong summer refinery run rates in the U.S., while a dip in domestic Chinese outputs helped drive price increases in the world’s largest import sulfur market.
U.S. market watchers originally signaled a likely $5-$10/lt increase at Tampa, but a late tender awarded in the U.S. Gulf at $153/mt drove the Tampa contract to its final level. Following Tampa higher, the Q4 Houston molten contract firmed to $125/lt from $106/lt, and NOLA contract values grew to $129/lt from $110/lt in the third quarter.
U.S. refining capacity dipped lower for the week, according to the Energy Information Administration (EIA). Refiners operated at 88.8 percent for the week ending Oct. 5, a decline of 1.6 percent from the prior week’s 90.4 percent. The rate also fell behind the year-ago 89.2 percent, but topped the 88.1 percent five-year average.
Daily crude inputs also pushed lower, notching an average 16.239 million barrels/d, 352,000 barrels/d below the 16.591 million barrels/d total posted one week earlier.
U.S. Gulf:
Chevron Corp. announced plans to build or buy a new refinery in the Houston Ship Channel, Reuters reported.
Chevron produced 270,000 barrels/d of oil from the Permian Basin, located in West Texas and eastern New Mexico. A Texas-based refinery would cut transport costs for the light, sweet crude produced in that region. The company currently operates a facility in Mississippi, and Chevron’s West Coast refineries are set up for processing heavier crude slates than those extracted from the Permian.
The recent Gulf prill market continued at $150-$153/mt FOB, steady from one week earlier.
U.S. Imports:
August sulfur imports were up 57 percent, to 187,394 st from the year-ago 119,572 st. July-August imports were up 44 percent, to 384,982 st from 267,493 st.
U.S. Exports:
August sulfur exports were down 22 percent, to 190,103 st from the year-ago 243,692 st. Morocco led the market with 95,845 st received, rising from 41,502 st last year. Mexico’s 44,976 st was down from the year-ago 98,735 st, while Brazil’s 34,472 st was also down from last year’s 42,845 st.
July-August exports were up 3 percent, to 414,821 st from 402,471 st.
Vancouver:
The Vancouver export market was heard at $155-$162/mt FOB in recent trading, unmoved from the previous report.
Sources described considerable supply tightness due to a number of planned and unplanned production outages in Western Canada. Supply was expected to begin normalizing toward the end of October.
Canada:
Alberta sulfur producers noted rising netbacks due to the updated Tampa molten sulfur contract, calling the market $15-$92/mt FOB. The floor of the range is typically set by molten tons contracted into the U.S. market, while the high is netted back on prilled material sold internationally on the Vancouver market. Alberta tons were last noted at (-)$4-$92/mt FOB.
An explosion and fire forced the shutdown of Canada’s largest oil refinery on Oct. 8, multiple news outlets reported. The 300,000 barrel/d Irving Oil refinery in St. John’s, New Brunswick, reportedly suffered a malfunction in a diesel refining unit, precipitating the blast and injuring several workers. The plant was reportedly on a turnaround at the time of the incident.
West Coast:
West Coast solid sulfur pricing continued at $150-$160/mt FOB for the week. Molten sulfur contracts were heard moving up to $95-$122/lt FOB for the fourth quarter, a rise from $85-$110/lt FOB in Q3.
China:
Last-done China prills were described at $190-$192/st FOB, steady from the prior report.
ADNOC:
United Arab Emirates-produced sulfur was offered at $173/mt FOB Ruwais for October, a $17/mt increase from $156/mt FOB in the previous month.
Aramco:
Saudi Aramco set October prill levels at $170/mt FOB Jubail. The market stood at $152/mt FOB in September, an $18/mt difference.
Qatar:
Muntajat set pricing at $170/mt FOB Hamad for October loading, a $25/mt increase from September’s $145/mt FOB.