Declining diesel stocks and increased domestic prices in Germany are supporting import margins, with actual import demand at low levels.
End-consumer diesel tank levels fell to a national average of 57pc in the week to 2 February, according to Argus MDX data. These were around 63pc at the beginning of January, after stockbuilding at the turn of the year, and are now a normal level for this time of year.
Data from Insight Global recently showed a 15pc increase in stocks at the Amsterdam-Rotterdam-Antwerp (ARA) hub following increased diesel imports from the US to Europe in January. Compared with December, imports have risen by around 100,000t to 1.75mn t, according to Vortexa.
This led to a slightly stronger price increase in Germany relative to diesel prices in ARA. A simultaneous drop in freight rates for product transport from ARA to locations on the Rhine and Main rivers theoretically make imports to the Lower Rhine profitable. Margins for diesel imports to northern Germany are increasing for the first in 2024.
But shipowners and importers said import demand to Germany remains low. Traditionally, traders buy less at the beginning of the year because the agriculture and the construction industries have little demand, and January 2024 was no exception. Traded diesel volumes reported to Argus in January were roughly on a par with previous years. German refineries are mostly running without restrictions, meaning domestic production meets current demand.
