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China’s low-sulphur marine fuel exports in Dec rise to a record

China’s exports of clean marine fuels in December rose to a record since shipments began a year ago, taking 2020 exports of the ship fuel to 15.45 million tonnes, customs data showed on Wednesday.

Chinese oil refineries began exporting very low-sulphur fuel oil (VLSFO) in January to comply with emission rules set by the International Maritime Organization (IMO), after Beijing granted tax incentives to boost local production to help create a regional bunkering hub.

In December, exports of VLSFO, with a maximum sulphur content of 0.5%, were 2.47 million tonnes, data from the General Administration of Customs showed, nearly double the volume in November.

Fuel oil imports into bonded storage, which includes both high-sulphur and low-sulphur materials, were 1.03 million tonnes in December, steady to November, and annual imports totalled 11.48 million tonnes.

China has 16 licenced firms supplying bonded marine fuel along its coast, including about a dozen based in the eastern port of Zhoushan, the country’s top bunkering centre.

Despite a surge in domestic production, companies maintained imports of less expensive low-sulphur cargoes from Singapore for re-export.

In late December, China issued 5 million tonnes of clean marine fuel export quotas in the first release for 2021 to five companies including private refiner Zhejiang Petrochemical Corp.

The table below shows China’s fuel oil imports and exports in metric tonnes.

The column of exports largely captures China’s VLSFO bunkering sales along its coast.

Exports   Monthly total      Year to date
 Jan-Feb                   1,560,681         1,560,681
 Mar                       1,068,789         2,629,470
 Apr                       1,433,185         4,062,655
 May                       1,143,929         5,196,914
 June                      1,264,909         6,461,687
 July                      1,179,766         7,641,453
 Aug                       1,621,449         9,262,902
 Sept                      1,266,796        10,529,698
 Oct                       1,223,311        11,753,009
 Nov                       1,261,832        13,014,841
 Dec                       2,473,000        15,449,200
   Imports  Ordinary       Bonded         Monthly     Year to date
            Trade          storage        total       
 Jan-Feb          199,770      2,516,123   2,716,957     2,716,957
 March            208,462        747,236     955,698     3,672,655
 April             67,657      1,029,406   1,097,063     4,769,718
 May               46,892      1,553,326   1,600,218     6,275,290
 June             230,465      1,292,880   1,523,345     7,798,520
 July              99,529        518,917     618,446     8,416,966
                                                      
 Aug              112,997        671,376     784,373     9,201,339
 Sept             110,607        605,215     715,822     9,917,161
 Oct               25,028        572,545     598,025    10,515,187
 Nov                  308      1,037,204   1,037,511    11,552,698
 Dec               26,876      1,026,770   1,053,646    12,606,344

Source: Reuters (Reporting by Chen Aizhu in Singapore and Muyu Xu in Beijing; Editing by Christian Schmollinger)

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