Tampa: Market speculation regarding a potential second-quarter contract price of molten sulfur delivered to Tampa continued to vary widely.
Some observers expressed continued optimism that firmer international markets would justify an increase at Tampa. Exports from the U.S. Gulf and Vancouver, priced in the mid-$80s/mt, should equal an increase from the first-quarter’s $75/lt contract, they argued.
Others, however, argued that the threat of tepid demand and softer pricing at China and potentially Vancouver was grounds for a potential decrease, and a growing number of observers predicted a rollover. All cautioned that Q2 talks remained in their infancy. Negotiations are expected to ramp up in the week ahead.
Refining capacity utilization increased last week, according to data released by the U.S. Energy Information Administration (EIA). U.S. refiners collectively operated at 89.3 percent capacity for the week ending March 24, a 1.9 percent increase from the prior week’s 87.4 percent and also ahead of the 88.5 percent five-year average. The rate, which trailed the year-ago 90.4 percent, represented the first consecutive weekly period of increased utilization so far in 2017.
Daily crude inputs also grew, the EIA indicated, reporting an average of 16.226 million barrels/d, some 425,000 barrels/d ahead of the previous week’s 15.801 million barrels/d average.
Vancouver: Sources called the Vancouver spot market unchanged at $83-$87/mt FOB for the week.
The Chinese import market continued to soften, sources said. Last-done sales were quoted in a $97-$101/mt CFR range, a decline from $100-$105/mt CFR at last report.
Alberta sulfur producer netbacks held steady at (-)$55-$20/mt FOB. The wide range was attributed to high logistics costs and lower returns on contract tons headed into the U.S. market, contrasted against solid material offered internationally by way of the Vancouver market.
Unifor Local 594 workers remained without a new employment contract at the Regina, Sask., Co-op Refinery on March 30, sources said. A mandatory cooling-off period will expire at 12:00 a.m. on March 31, after which workers are free to strike and the refinery is permitted to begin layoffs.
Sources speculated that a strike was imminent. The refinery intends to continue production in the event of a walkout, cutting capacity if necessary to maintain worker safety, contacts said. The refinery installed approximately 50 trailers in early March, presumably to house temporary workers in anticipation of a potential strike.
West Coast: Second-quarter West Coast molten contracts began to settle last week, rolling over from the first quarter’s $55-$77/lt FOB level. Observers called prills $80-$83/mt FOB, unchanged from the week before.
PBF Energy Inc. will not be forced to phase out the use of hydrofluoric acid at its refinery in Torrance, Calif., local news outlets reported. The Torrance City Council bucked expectations in voting 5-2 against disallowing the refinery’s use of the controversial chemical.
Hydrofluoric acid has been blamed for a number of safety issues at the refinery, including a 2015 explosion that hobbled production for more than a year.
QPSPP: Qatar Petroleum announced April formed sulfur offers at $83/mt FOB Ras Laffan, a $9/mt reduction from the March price of $92/mt FOB.