Tampa:
The global refining industry is poised to make a partial recovery in 2021 after a battering from coronavirus-related throughput reductions in 2020, according to a recent analysis by the International Energy Administration (IEA) and reported by Platts.
Worldwide throughput was projected at 78.9 million barrels/d for 2021, rising from an average 76.9 million barrels/d in 2020. Global production was noted falling 7.2 percent year-over-year at the peak of the pandemic before clawing back in November, shooting 2.6 million barrels/d higher from October to 76.1 million barrels/d, described by the IEA as the industry’s single largest monthly gain in seven years.
Demand growth is expected to outstrip 2021’s projected supply increase, however, which sources described as a potential bullish indicator for refining margins.
Roughly 200 members of the International Brotherhood of Teamsters Local 120 union on Jan. 21 announced a strike at Marathon’s refinery in St. Paul Park, Minn., after failing to agree to terms on an updated labor contract. The previous contract expired on Dec. 31, 2020. Workers voted in December to authorize a strike should negotiations fail, Reuters reported.
Talks were reported to hinge on a demand from Marathon to replace a number of union employees at the 102,000 barrel/d facility with non-union contract workers (GM Jan. 8, p. 16), a move reportedly viewed by the union as a potential safety hazard.
Tampa molten sulfur contracts were valued at $96/lt CFR for delivery in the first quarter, a $27/lt increase from $69/lt CFR in the previous period.
U.S. refinery utilization slipped lower for the period ending Jan. 22, according to the Energy Information Administration (EIA). Capacity softened to 81.7 percent for the week, a 0.8-point decline from 82.5 percent in the previous week, and also trailing both the year-ago 87.2 percent and the 87.1 percent five-year average.
Daily crude inputs were also lower at an average 14.721 million barrels/d, falling 39,000 barrels/d from the previous 14.760 million barrel/d figure.
U.S. Gulf:
Price ideas on the Gulf spot export market were noted firming to $110-$120/mt FOB, based both on available international netbacks and a reported increase in Gulf freight rates.
Brazil:
The Brazil spot import market was noted firming to $140-$145/mt FOB, up from $130-$133/mt FOB in the prior report.
Vancouver:
Last-done at Vancouver continued to be heard in the $110-$118/mt FOB range, steady from the prior report. Rising international values were expected to lift Vancouver into the $120s/mt FOB in the next round of business, although firmer Pacific freight costs were projected to shave $2-3/mt from netbacks in the short term.
Alberta:
Alberta sulfur values remained in a wide (-)$31-(-)$48/mt FOB range, based on netbacks from both molten tons contracted into the U.S. market and prilled material selling through the Vancouver export market.
West Coast:
West Coast prill values were unchanged at $110-$118/mt FOB, but the market was projected to move higher in the near term. Sources described molten sulfur contracts in the $70-$77/lt FOB range for first-quarter loading, an increase from $45-$60/lt FOB in fourth-quarter 2020.
China:
Sources reported spot sulfur cargoes imported to China firming ahead of the Feb. 12 Lunar New Year holiday, which is expected to shut the market for approximately two weeks. Values lifted to $147-$152/mt CFR in recent trading, up from $132-$138/mt CFR at last report.
Qatar:
Muntajat prilled sulfur offers were noted firming to $125/mt FOB Ras Laffan for loading in February, a $24/mt increase from $101/mt in the prior month.
ADNOC:
ADNOC solid sulfur cargoes were expected to follow Muntajat higher in February. January offers were posted at $102/mt FOB Ruwais.