Petroleum coke availability from Mexican-state owned Pemex's 340,000 b/d Olmeca refinery at Dos Bocas has started to rise in recent weeks, according to market participants, after operational issues contributed to reduced exports from the refinery this year.
Coke production at the Dos Bocas refinery, in Tabasco state, has risen to around 4,000-5,000 t/d, a source said. While this is still lower than normal production of around 5,500-7,000 t/d, it has increased from 3,000-3,500 t/d in recent months. The refinery is expected to load at least four cargoes in July and will likely export five cargoes/month in August onward, a couple of traders said. So far in July, Dos Bocas has loaded one 18,200t cargo, according to data from ship tracking service Kpler, although the data are preliminary and subject to correction. The destination of this vessel is not currently listed.
Exports from the Dos Bocas refinery have totalled 826,300t so far this year, with January posting the lowest volume of loadings at 97,000t, Kpler data show. But many sources have reported lower export volumes. According to Mexico National Institute of Statistics and Geography data compiled by Global Trade Tracker (GTT), Mexico exported no coke in January-March. April-loading US coke exports to Mexico also jumped by 46pc from a month earlier, GTT shows, suggesting limited domestic supply generated higher demand for seaborne purchases.
Several incidents may have contributed to lower exports from Dos Bocas so far this year. Shipments were first cut in January after fog and rainy weather disrupted loadings, and operational issues with a short conveyor belt to move coke onto vessels may have created further issues at this time. Pemex also reported two separate fires at Dos Bocas in March and April, the latter of which sources said might have damaged a coker.
The lack of exports from Dos Bocas likely led Florida utility JEA to take two US Gulf-origin cargoes from Motiva's 640,500 b/d Port Arthur refinery in April and June. JEA was able to take advantage of the extended Jones Act wavier, which allows movement of energy products between US ports on ships that are not US-built, crewed and flagged.
The increase in Mexican coke availability could provide some competition for US-origin high-sulphur supply, and demand has recently increased for the material, a trader said. Mexican coke has been offered to India and China in the past couple of weeks, and another source said some Turkish buyers have shown interest in this material. Mexican coke offers were last heard in the high-$60s/t on a fob basis.
A rise in Mexican high-sulphur coke supply also comes as many US Gulf refiners have shifted to mid-sulphur coke production, tightening 6.5pc sulphur supply. While the recent US-Iran peace agreement was expected to eventually revive heavy sour Middle East crude flows to the US, which would produce more higher-sulphur supply, hostilities in the Middle East have now reignited, again blocking traffic through the strait of Hormuz.
