UPDATE 1-Brazil imports more Asian diesel to meet industrial demand
* High North Asian refinery runs, soft demand support exports
* Brazilian diesel imports to stay firm as economy expands
* Goods moved mainly by diesel-powered trucks in Brazil (Adds details, background, comments)
By Francis Kan
SINGAPORE, July 4 (Reuters) - At least 350,000 tonnes of North Asian diesel have been booked for shipment to Brazil for loading in the past month as demand for the fuel surges to meet growing industrial activity in South America's largest economy, ship brokers and traders said on Monday.
Brazil's diesel fuel demand rose 11.2 percent in 2010 to nearly 850,000 barrels per day, tracking a robust 7.5 percent gross domestic product growth rate. The economy is forecast to expand by 4 percent this year, Brazil's central bank said last week.
The shipments from South Korea and Taiwan were all chartered by Brazilian state oil firm Petrobras , and matches the volume seen in the previous three months, shipping data from two shipbrokers showed.
The latest cargo is for 80,000 tonnes of diesel for July 8 loading on the vessel Eternity, according to the data.
"Exports from North Asia have been very high recently due to huge refinery runs and soft demand at home, so it's not surprising since Brazil is tight on products," said a Singapore-based distillates trader.
Brazil usually imports its fuel from the United States, but with the economy still growing and no major refinery capacity additions due until 2013 at the earliest, the country will need to import more from other markets in the next two years, analysts said.
Petrobras expects to complete upgrades at a number of refineries by 2014 or 2015, the company's downstream director Paulo Roberto Costa told Reuters on the sidelines of a conference in London last month.
Most Brazilian goods move to market in trucks that use diesel fuel, due to limited alternative shipping methods in the vast country.
The rising exports come during Asia's peak diesel demand season and as China prepares to import more of the fuel to meet expected power shortages in some parts of the country.
"The market has already been strengthening on the China moves, but if we see more shipments to the West this will lift the market further," said another trader.
China will lower import duties for diesel and jet kerosene to zero and also cut those on fuel oil to one percent from three percent from July 1, a move likely to boost imports of these fuels as summer power demand grows.
Asia's gas oil market strengthened on Friday, with cracks rising to a two-week peak near $19 a barrel, while the July/August contango narrowed to almost parity.
DIESEL FIXTURES TO BRAZIL VESSEL VOL LOAD PORT SKS DONGGANG 90KT 5/7 TAIWAN ETERNITY 80KT 8/7 TAIWAN SKS DOKKA 90KT 25/6 TAIWAN SKS DURO 90KT 15/6 S.KOREA (Additional reporting by Randy Fabi; Editing by Michael Urquhart)
- North Korea says Kim's powerful uncle dismissed for 'criminal acts'
- Thai PM calls snap election, protesters press on |
- Protesters fell Lenin statue, tell Ukraine's president 'you're next'
- Singapore hit by rare outbreak of rioting, 27 arrested |
- Venezuela's Maduro to raise pressure on business after local vote