Tough Week – Yet Again – for Small Chemical Tankers in South Europe

In the Western Mediterranean region, market activity saw a modest uptick compared to the previous week, driven by slight improvements in CPP and chemical cargo numbers.

However, the overall market remains fragile, with limited movement. While some traditional market players continue to move certain cargoes, there have been no significant shifts or drastic changes in market dynamics. Biofuel activity continues to be minimal, with only a few biofuel stems making headlines.

Notably, Vertex quoted two ethanol shipments: a 2,000-ton ethanol cargo from Cartagena to Ravenna, with laycan between 5/7 September, and a larger 7,000 to 8,000 cubic meter ethanol shipment from La Coruna and Cartagena to Lavera and Port-La-Nouvelle, scheduled for 6/8 September, fixed around €200,000, a decrease from a week ago, settled around €250,000.

Despite the persistently low activity levels, freight rates have shown signs of stabilization. Shipowners appear reluctant to lower rates further, indicating that the market may have found a floor. The situation in the East Mediterranean and Central Mediterranean mirrors or, in some cases, worsens the trends observed in the Western part, with equally challenging conditions for market stakeholders.

In related news, Spanish biodiesel imports saw a significant decline, falling below 40,000 tons in June, marking a 72% drop year over year. This sharp decrease followed the European Union’s imposition of anti-dumping duties on Chinese biodiesel, which severely impacted import volumes.

During the first half of the year, biodiesel imports reached a seven-year low of 280,000 tons, while net exports surged to a record 540,000 tons. Meanwhile, domestic biodiesel production in Spain increased to 1.3 million tons, up from 1.15 million tons the previous year.

This production growth comes amid a significant shortfall in 2023 blending obligations, which have been valued at €565 million ($631 million).