Australia's coking coal exports rose for the seventh straight month in September, up by 11% month-on-month to an all-time high of 13.9 Mt compared to the previous record of 13.45 Mt set in June 2008. This is the fifth consecutive month showing the monthly volume above 10 Mt due to strong demand from Japan and China.
Japans ore imports rise to a year-to-date high
According to the latest data from Japans Ministry of Finance, Japans iron ore imports in September surged above 10 Mt for the first time over the past nine months, up by 12% year-on-year to 10.82 Mt. However, imports in the first nine months were still down by 31% from the same period last year to 72.4 Mt.
Meanwhile, Japans coal imports (including anthracite) fell for the second consecutive month to a 4-month low of 13.9 Mt in September. However, coking coal imports to Japan rose to 6 Mt, the highest level since January.
EU economy forecast to show gradual recovery
The European Commissions autumn forecast for EU economic growth projects a 4% fall in 2009, which is unchanged from its spring forecast. The commission now projects that the EU economy in 2010 will grow by 0.75% followed by 1.5% expansion in 2011. This compares with the previous forecast in May of a 0.1% contraction for 2010.
US Crude, Gasoline and Distillate Stocks All Down.
US crude stocks decreased 4 mbbl last week to 335.9 mbbl as imports fell 764 kb/d to 8.1 mb/d, according to the latest data from the US Department of Energy. Gasoline inventories were down 0.3 mbbl to 208.3 mbbl as imports rose 321 kb/d to 1.1 mb/d and demand rose 157 kb/d to 9.02 mb/d. Distillate stocks fell 0.4 mbbl to 167.4 mbbl as demand fell 67 kb/d to 3.57 mb/d and imports rose 13 kb/d to 197 kb/d. Refinery utilisation was down 1.2% to 80.6%.
Work Begins on Myanmar Pipeline.
China National Petroleum Corp (CNPC) has commenced construction of a pipeline across Myanmar, Associated Press reports. The 771k mile pipeline will connect Maday Island in western Myanmar, with Ruili in Southwest China, reducing the country's reliance on the Malacca Strait for receiving its crude imports. The new pipeline will reduce the current maritime delivery route by 1,200km, giving China quicker access to oil supplies. When fully operational, the line will be able to deliver an estimated 442 kb/d.
November Sees Drop in Russian Loading Schedules
Transneft, Russia's national pipeline operator, has scheduled crude exports of 2.68 mnb/d for November, 76 kb/d less than planned for October, Energy Intelligence reports. Whilst the Black Sea port of Novorossiysk is set to export 939 kb/d this month (143 kb/d more than in October), this rise is cancelled out by a month-on-month decrease of exactly the same amount at Primorsk (1.44 mnb/d in November, down from October's 1.58 mnb/d). Tuapse sees planned Russian exports for the month down to 77 kb/d, from 90 kb/d in October, with Yuzhny at 176 kb/d, down from 246 kb/d. Gdansk sees a rise of 6 kb/d, to 54 kb/d.
Spot iron ore price rises to a 10-week high
According to data from U-Metal, the FOB price of Indian iron ore of 63.5% Fe content rose for the second consecutive month, standing at $76/t at the end of October. Delivered prices into China have climbed from $81/t in mid-September to the current level of $94/t. Meanwhile, iron ore stockpiles at Chinas discharge ports have fallen to a 6-month low of 67.62 Mt, 6.7 Mt lower than the year-to-date high of 74.13 Mt set in mid-September.
Ultra-Deep Waters to Boost Angolan Crude Output
BP's $10bn development of the Plutao, Saturno, Venus and Marte fields within its Angolan ultra-deep block 31 will launch in 2011, reaching peak production of 150 kb/d in 2012, reports Argus. The PSVM development will be the first of 3-4 150k b/d developments that, in combination with similar future projects from other firms, could help raise Angolan output capacity from its current 2 mnb/d to as much as 2.5 mnb/d by 2015. Whereas high costs and the relatively small discoveries Angola's ultra-deep fields have previously offered have led to a reluctance to look beyond the country's prolific deep water, large reserve estimates on blocks 31 and 32 (3.8 bnbbl in total) have stimulated interest in ultra-deep developments from a number of firms.
Iraq Signs Deal to Develop Zubair Oilfield
Iraq's Oil Ministry has signed its second major new contract with an international oil firm since the 2003 invasion, Reuters reports. A consortium led by Eni, aims to increase production in the Zubair field to 1.13 mnb/d by 2016, from 195 kb/d now. The deal follows BP and CNPC's agreement to develop the 17 bnbbl Rumaila field that currently accounts for about half of the country's crude output.
Latest Grain Trade Forecasts from the IGC
Due to large purchases from Near East Asia, the International Grain Council (IGC) has lifted its forecast for world grain trade in the 2009/10 marketing year by 2 Mt from last month's forecast to 226 Mt, compared with 247 Mt in 2008/09. The IGC expects wheat exports from the five major exporters to reach 75.9 Mt in the 2009/10 trade year, 1.5 Mt higher than the previous month's forecast, however, far below a record volume of 91.9 Mt in 2008/09. Meanwhile, the total forecast export volume for world soyabeans has increased to 77.1 Mt for this marketing year from 75.8 Mt a year earlier.
Mexican Crude Production and Exports Rise
After August's decline, September saw Mexico's crude output rise by 57 kb/d to average 2.60 mb/d for the month, reports Energy Intelligence. Similarly, exports for September rose 27k b/d to reach 1.13 mb/d. Elsewhere in the region, BHP, Repsol and Hess have made two oil discoveries in the Shenzi field, 120 miles off the coast of Louisiana, reports Bloomberg. The news has increased optimism in the production prospects of the area and in the Gulf of Mexico as a whole.
First Kozmino Crude Shipments Set for December
22 October saw the port of Kozmino, on Russia's Pacific coast, receive - by rail - its first crude cargo, Argus reports. The first tanker cargo is due to leave the port towards the end of December from its double-sided berth, which can accommodate tankers up to 150 kdwt. Until the ESPO pipeline, of which Kozmino constitutes the end point, comes fully on stream in 2014, the port will be supplied by rail at a rate of 15 mt/yr. After this, pipeline deliveries are scheduled at 30 mt/yr, with 5 mt/yr continuing to arrive by rail.
World HRB steel price falls to a 4-month low
According to World Steel Dynamics SteelBenchmarker, the world export price for hot rolled band has slipped by $42/t month-on-month to $503/t, representing the lowest level since June. US and EU HRB prices are both down from their year-to-date highs in September to stand at $592/t and $588/t respectively. In contrast, Chinese HRB prices have increased from $415/t last month to the current price of $430/t after falling for the previous two months.
Little Overall Change in North Sea Loading Schedules for November.
Despite varied schedules for individual systems within the Norwegian and UK North Sea sectors, the total scheduled volumes for November suggest a drop of only 17k b/d m-o-m, or 0.78%, to 2.081m b/d. Energy Intelligence reports. In line with traditional levels of respective optimism, the Norwegian sector anticipates an overall gain of 33k b/d, whilst the UK schedules a fall of 49k b/d. Temporary production difficulties in the Buzzard field have led to the deferral of two cargoes originally due to load towards the end of November, which in turn saw a 38k b/d drop in the Forties schedule.
Chinas iron ore imports by source in September
China imported a total of 25.98 Mt of iron ore from Australia in September, up by 18% month-on-month and 34% year-on-year, with Australias share of Chinas imports more than 40%. Imports from Brazil rose by 70% year-on-year to an all-time high of 16.71 Mt, accounting for 26% of total imports as the second largest supplier in
September. Shipments from India were 8.42 Mt, posting a massive 72% year-on-year increase, according to U-metal.
US Crude and Gasoline Stocks Rose, Distillate Fall
US crude stocks grew 0.8m bbl last week to 339.9m bbl as imports increased 191k b/d to 8.9m b/d, according to the latest data from the US Department of Energy. Gasoline inventories were up 1.7m bbl at 208.6m bbl as imports rose 107k b/d to 756k b/d and demand fell 92k b/d to 8.86m b/d. Distillate stocks fell 2.1m bbl to 167.8m bbl as demand rose 150k b/d to 3.6m b/d and imports rose 64k b/d to 184k b/d. Refinery utilisation was up 0.7% at 81.8%.
South Koreas economy posts quarterly growth at 7-year high
South Koreas GDP rose by 2.9% quarter-on-quarter in the 3q09, the fastest pace since 1q02 and up from 0.6% compared with the same period last year after three consecutive quarters of negative year-on-year growth.
India's Crude Output Falls in September
India's crude output fell 0.5% y-o-y in September to 2.77Mt, or 677k b/d, for the ninth monthly decline in 10, reports Bloomberg. The fall was led by lower output from Oil & Natural Gas Corp, the country's largest explorer. Production from non-state explorers rose 7.9% to 425kt, or 104k b/d. India's refiners increased crude processing by 3.4% y-o-y in September to 13.5Mt, the second monthly rise, to meet fuel demand.
FSU Product Exports Rise in 3Q09
FSU product exports rose 450k b/d in the 3Q09 y-o-y to over 2.9m b/d, mainly due to higher shipments of middle distillates, particularly to the EU, and strong Asia-Pacific fuel oil demand, reports Argus. Gasoil exports have been increasing from Primorsk and Ventspils due to new infrastructure and refinery upgrades. Volumes of 10ppm diesel from Primorsk were 115k b/d in September, up from under 25k b/d a year earlier. The US has been importing Russian heating oil, with 1.1m bbl due to start arriving on the east coast in late October, however, the arb is not expected to stay open long.
Chinese wire rod prices rise to a 5-week high
There are tentative signs of improved end-user demand for steel in China, with some prices showing upward movement after two months of decline. According to World Steel Dynamics, Chinese wire rod FOB prices have increased by $20/t (+4%) from their recent 6-month low of $479/t set in early October to the current level of $499/t, the highest level over the past five weeks.
Modest Monthly Increase In Global Steel Production
World steel production in September reached 107.0 Mt, a gain of just 0.5 Mt on August, according to Worldsteel. The data show virtually flat growth year-on-year, although September 2008 was one of the first months to experience output cuts due to the sudden worsening economic conditions. Furthermore, there remains a sharp contrast between trends in China, where output was up 27% YoY to 50.7 Mt, and other major producing areas. For example, Japan (8.3 Mt, down 18%), the US (5.4 Mt, down 31%) and the EU-27 (13.2 Mt, down 24%) are still well short of year-ago levels.
FSU Crude Exports Rise
FSU crude exports to non-CIS destinations rose 7.7% y-o-y to 6.61m b/d in Jan-Sept 2009, reports Argus. The rise came as Caspian crude loadings increased, as did exports of Russian crude from the Barents Sea port of Varandey. Overall, exports were up 2.7% month-on-month in September at 6.69m b/d. CPC shipments were up 3.9% on the month at 738k b/d, 11.9% higher on the year. BTC exports were down 2% on the month at 789k b/d but were 15.2% higher than the previous year.
China Processes Record Volumes of Crude
China processed a record volume of crude oil at 32.83Mt, or around 8m b/d, in September (2.2% higher than the previous high) to power accelerating economic growth and feed a rapidly expanding car fleet, reports Dow Jones. The record runs came after a 240k b/d plant was brought online in August and the government raised gasoline and diesel prices by 4-5% in September. Runs are expected to stay high as the demand outlook for products, mostly diesel and gasoline, looks strong. Diesel output rose 12% y-o-y to 12.7Mt in September while gasoline rose 9.1% to 5.78Mt. China's GDP rose 8.9% in the 3Q09 y-o-y, the fastest pace this year and up from 7.9% in the 2Q09, as stimulus spending and record lending growth helped the nation lead the world out of recession.
US Crude Stocks Rise, Gasoline and Distillate Fall
US crude stocks rose 1.3m bbl last week to 339.1m bbl, but remained 8.9% higher y-o-y, with imports dipping 32k b/d to 8.7m b/d, according to the latest data from the US Department of Energy. Gasoline inventories dropped 2.3m bbl to 206.9m bbl as imports fell 41k b/d to 649k b/d and demand declined 306k b/d to 8.95m b/d. Distillate stocks were down 0.8m bbl to 169.9m bbl as imports fell 44k b/d to 120k b/d, while demand fell 70k b/d to 3.49m b/d. Refinery utilisation was up 0.2% at 81.1%.
Coal Imports in China Remain High
High volumes of coal imports into China were maintained in September, when 12.55 Mt were imported compared with 3.7 Mt in the same month last year, according to Chinas Customs Statistics. Septembers total was just 3.52 Mt below Junes record monthly total of 16.07 Mt. Chinas coal imports have boomed in 2009, year-to-date imports of 86.46 Mt have already far exceeded the previous annual record of 51 Mt in 2007.