Tampa: Despite early fears that the recent flooding in Louisiana could impact the domestic sulfur market, sources said the floods have had minimal effect. “I don’t believe there have been any significant reductions in production,” commented one market player.
Known Louisiana production curtailments were limited to a pair of refineries. Reports put production at ExxonMobil Corp.’s 502,500 barrel/d Baton Rouge refinery at roughly 60 percent for the week. The lost capacity was traced to a 110,000 barrel/d CDU shut down by the flooding, an idled coking unit, and a 210,000 barrel/d CDU scheduled for a 50-percent turnaround prior to the flooding.
Additionally, Motiva Enterprises’ 235,000 barrel/d Convent facility retained minimal operating capacity following an Aug. 11 hydrocracker fire, sources said.
The third-quarter contract price of molten sulfur delivered to Tampa is $65/lt DEL.
Domestic refining capacity softened last week, according to data released by the U.S. Energy Information Administration (EIA). Utilization fell to 92.5 percent for the week ending Aug. 19, a 1.0 percent drop from 93.5 percent on Aug. 12. Current-week capacity trailed the year-ago rate of 94.5 percent and matched the 92.5 percent five-year average.
Average daily crude inputs also sank, the EIA said. Inputs were logged at 16.679 million barrels/d, a 194,000 barrel/d decline from the previous week’s 16.865 million barrels/d.
U.S. Gulf: Last-done out of the Gulf was quoted at $60-$65/mt FOB.
Reduced domestic demand stemming from the recent flooding in Louisiana could lead to greater volumes being offered out of the U.S. Gulf, sources speculated, potentially reducing netbacks in the next round of business.
Vancouver: The Vancouver market was quoted in the $65-$70/mt FOB range, down from $70-$75 in the prior week.
Despite possessing an estimated 1.8-1.9 million mt of sulfur inventory at port, sources described firming signals in the Chinese spot market. Although last-done business remained in the $81-$82/mt CFR range, recent strengthening in both the Qatar and Iran spot markets suggested a possible lift at China, some said.
Not all were convinced, however. Some attributed the rising Middle East prices to supply weakness rather than firming Chinese demand. “There is lots of inventory in China. I believe there is firmness in supply offerings,” one source commented. “The $72/mt Tasweeq price doesn’t really make sense in China,” added another.
Vancouver has surpassed Tampa as the preferred destination for Alberta sulfur producers in the third quarter, sources said. Drawn by Vancouver’s $10/mt price advantage over Tampa, along with an additional currency exchange-related boon from the strong U.S. dollar, “most” Alberta producers have vacated the Tampa market, some contacts claimed.
The shift could translate to stronger Alberta netbacks in the third quarter, observers speculated. The Alberta market was quoted at (-)$55-$20/mt FOB for the second quarter.
West Coast: West Coast prills followed Vancouver lower, and were called $60-$65/mt FOB. Buyers and sellers quoted third-quarter molten contracts in a $50-$75/lt FOB range.
ADNOC: August formed sulfur offered by the Abu Dhabi National Oil Co. was priced at $70/mt FOB Ruwais. ADNOC offered $80/mt FOB cargoes in July, a $10/mt difference.
Aramco: Saudi Aramco priced August-loading cargoes at $66/mt FOB Jubail, down $7/mt from the previous month’s $73/mt FOB.
Tasweeq: Qatar state-run oil company Tasweeq listed August prills at $65/mt FOB Ras Laffan, a $7/mt decline from July’s $72/mt FOB. Despite the list price, sources reported a recent spot cargo transacting at $72/mt FOB.
Iran: Market players reported a crushed-lump sulfur cargo sold out of Iran last week. The material was priced at $64/mt FOB, a $7/mt increase from recent transactions out of Iran.