Taiwan's Formosa Petrochemical Corp will cut its base oil output to 40,000mt in June, because it will put its 500,000-600,000mt/yr base oil unit into weeklong maintenance in end May or early June, a company source revealed. The volume is 33% lower than its May output, he added.
The company previously planned to start the maintenance on May 23, but postponed it, he furthered.
The Taiwanese oil major will send 20,000mt of Group II base oils to Mainland China's long-term contracted buyers in June, he revealed.
In addition, whether the company can have spot cargoes in June remained uncertain yet, the company source said.
If there are any extra cargoes, the company will send them to Southeast Asian countries rather than to Mainland China, where prices have shown downtrend recently, he explained.
Thanks to lower output in Asia, a result of heavy refinery turnarounds, China's Group II base oil imports will decline in June, some domestic market players opined.
Domestic supplies of high-viscosity base oil will become lower in June, which may lend supports to June prices, they reckoned.
As for low-viscosity base oils, overall supplies will remain at high levels thanks to replenishments from CNOOC Huizhou Refinery and Hainan Handi Yangguang Petrochemical Co, they estimated.
Formosa's base oil refinery is located in Central Taiwan’s Mailiao. It last shut its base oil unit for three-day maintenance in early or mid March on unit glitch.
