Beijing-based commodity market information provider JLC Network Technology Co. recently shared its JLC China Bunker monthly report for February 2024 with Manifold Times through an exclusive arrangement:

Bunker Fuel Demand

China’s bonded bunker fuel sales fall in February

China’s bonded bunker fuel sales decreased in February, due to a rise in bonded low-sulfur fuel oil (LSFO) prices, as well as the Chinese New Year holiday and severe weather in the north.

The country sold about 1.50 million mt of bonded bunker fuel in the month, with the daily sales down by 11.80% month on month to 51,641 mt, JLC’s data shows.

The sales by Chimbusco, Sinopec (Zhoushan) and China ChangJiang Bunker (Sinopec) slipped to 500,000 mt, 570,000 mt and 26,000 mt in February, while those by suppliers with regional bunkering licenses dropped to 361,600 mt, down from 495,000 mt in January. At the same time, SinoBunker sold about 40,000 of bonded bunker fuel, unchanged month on month, the data indicates.

China’s bonded bunker fuel exports rally in December 2023

China’s bonded bunker fuel exports rallied in December 2023, because of a relatively low base a month earlier.

The country recorded about 1.59 million mt of bonded bunker fuel exports in the month, jumping by 16.18% month on month, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

Heavy bunker fuel exports amounted to 1.51 million mt in the month, accounting for 94.85% of the total, while light bunker fuel exports settled at 81,900 mt, accounting for 5.15%.

Suppliers with national bunkering licenses exported roughly 1.17 million mt of bonded bunker fuel in the month, accounting for 73.32%, with Sinopec Fuel Oil and Chimbusco taking 67.63%. In the meantime, enterprises with regional licenses exported about 424,100 mt, occupying 26.68%.

The month-on-month increase in the exports was mainly ascribed to a relatively low base in November when Chinese refiners cut their bonded bunker fuel exports to a ten-month low.

However, tighter export quotas and low-sulfur fuel oil (LSFO) supply limited the growth in December’s bonded bunker fuel exports.

On a year-on-year comparison, China’s bonded bunker fuel exports surged by 32.32% in December.

China exported a total of 19.66 million mt of bonded bunker fuel in 2023, growing by 3.06% from the previous year, accelerating from a rise of 1.09% in January-November.

(Note: There is no breakdown of the country’s exports for January 2024 yet, though the GACC has announced the combined exports for January and February.)

Domestic-trade heavy bunker fuel demand plunges in February

Domestic-trade heavy bunker fuel demand plunged in February, as shipping demand was tepid during the Chinese New Year holiday and bunker fuel was still overpriced. Domestic-trade heavy bunker fuel demand was estimated at 360,000 mt in the month, a slump of 70,000 mt or 16.28% from a month earlier, JLC’s data shows.

At the same time, domestic-trade marine gas oil (MGO) demand settled at 120,000 mt, stable month on month, the data indicates. Domestic-trade light bunker fuel demand leveled off, and the inland shipping market stayed lukewarm.

Bunker Fuel Supply

China’s bonded bunker fuel imports tumble in December

China’s bonded bunker fuel imports stood at 315,200 mt in December, a slump of 41.29% month on month and 23.92% year on year, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

Though domestic LSFO output declined further, most distributors continued to cut their imports in the month amid high import costs.

South Korea topped all suppliers by shipping 95,400 mt to China in December, accounting for 30.26% of the latter’s total imports, while Malaysia climbed to the second place with 88,600 mt, accounting for 28.11%. Iraq and Japan ranked third and fourth with 86,600 mt and 30,700 mt, making up 27.46% and 9.73% respectively. 

Russia slipped to the fifth place with 13,000 mt, occupying 4.12%, while Singapore fell to the sixth place with only 1,000 mt, accounting for 0.32%.

China’s bonded bunker fuel imports are expected to move lower in January 2024 because domestic LSFO production will return to normal after the release of the first batch of LSFO export quotas for this year.

(Note: There is no breakdown of the country’s imports for January 2024 yet, though the GACC has announced the combined imports for January and February.)

Domestic-trade bunker fuel supply tightens in February

Domestic-trade heavy bunker fuel supply tightened in February, as blenders slowed down production amid the Chinese New Year holiday.

Chinese blenders supplied about 400,000 mt of domestic-trade heavy bunker fuel in the month, a decline of 40,000 mt or 9.09% from January, JLC’s data shows. Traders and shipowners reduced purchases after finishing pre-holiday restocking, forcing blenders to reduce their output at the beginning of the month. Most blenders continued to lower output during the holiday, and some even suspended production. Heavy bunker fuel supply did not grow much after the holiday as some blenders were still on vacation, also because of relatively tight supply of blendstock.

Similarly, domestic-trade marine gas oil (MGO) supply diminished to 130,000 mt in the month, down by 10,000 mt or 7.14% month on month, the data shows. Refineries’ enthusiasm for MGO production was still low in February, as domestic MGO prices dipped and cargo delivery was not smooth amid bad weather.

Editor
Yvette Luo
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JLC Network Technology Co., Ltd is recognized as the leading information provider in China. We specialized in providing the transparent, high-value, authoritative market intelligence and professional analysis in commodity market. Our expertise covers oil, gas, coal, chemical, plastic, rubber, fertilizer and metal industry, etc.

JLC China Bunker Fuel Market Monthly Report is published by JLC Network Technology Co., Ltd every month on China bunker market, demand, supply, margin, freight index, forecast and so on. The report provides full-scale & concise insight into China bunker oil market.

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Note: China-based commodity market information provider JLC Technology has been providing Singapore bunkering publication Manifold Times China bunker volume data since 2020. Data from earlier periods are available here.

Photo credit: JLC Network Technology
Published: 11 March 2024