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Monday, 15 December 14
WILL TANKERS BENEFIT FROM REEMERGENCE OF FLOATING STORAGE PLAYS? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The tanker market has been seeing high freight rates for some time now, riding on the back of low oil prices, which are boosting demand from developing nations, looking to replenish their stockpiles. However, another factor could also emerge, with the return of floating storage plays. According to the latest report from shipbroker Charles R. Weber, “following strong crude price losses during late 2008 and early 2009, the $45 emergence of a steep contango in crude futures markets supported a surge in demand for tankers to service floating storage contracts. By 2010, as the $30 wheels of the global economy improved on a return to strong growth in $15 emerging economies, the contango curve became steep enough to support $0 floating storage sufficiently to consume through much of 1H10 upwards of 10% of the global VLCC fleet. This lead to stronger earnings for the class with knock on effects for smaller tanker counterparts as overall availability levels declined”.
According to the shipbroker, “when crude prices started observing losses early during 2H14, the reemergence $60 of a contangoed futures curve reignited consideration of floating storage, but $45 little has materialized as the S/bbl storage costs consistently forward crude spreads. With the global demand/supply imbalance having extended through $30 2H14, the unwillingness by OPEC (or more specifically: a prominent contingent of OPEC’s membership) to react through supply cuts, recent downward $15 revisions by key oil forecasting agencies to demand projections implies that a wider imbalance will materialize during 2015. In its latest report, the IEA notes $0 the imbalance with a corresponding rise in implied steep building up of global crude inventories of relative earnings strength (if below present peak levels). How the crude $80 market develops thereafter will likely dictate the course that tanker earnings take through the remainder of 2015. $60 For its part, support from floating storage remains off the table due to the $40 prohibitively high cost to procure tonnage for such a purpose”.
C.R. Weber noted that “at present assessments, a 6 month floating storage contract off Singapore would equate to $20 a cost ~$5.84/bbl while the spread between Brent’s front month and July contracts stands at $3.72/bbl Further into 2015, however, continued crude price losses which could be inferred by the |EA’s projected widening of the global demand/supply $40 imbalance could lead to crude supply cuts to support prices. Though such a $30 scenario represents a threat to crude tanker demand, a simultaneous correcting of freight markets and steepening of contango curves could create the requisite $20 economics to support floating storage. This would likely place a floor on prospective freight downside while bridging the market to a subsequent $10 rebalancing of crude markets, thus limiting an impact on crude tanker earnings”, the shipbroker concluded.
Meanwhile, in the crude tanker markets this week, in the VLCC segment “rates firmed this week as charterers worked through much of the remainder of the Middle East market’s December program while owners became more bullish in a late reaction to narrower supply/demand fundamentals. Stronger demand in the Middle East market – where the December program has already yielded the most cargoes since the April program and is poised to conclude with the most since the February market – has coincided with a recent demand acceleration in the West Africa market. As both of these areas draw from Middle East positions, the region’s supply/demand positioning is at its narrowest level since 2008 with just 5 surplus positions through end? December dates. With 118 Middle East December cargoes covered to date and the program expected to conclude with 121, the 8 units which remain on position lists to cover the remaining stems appear set to observe premiums to present assessments. How aggressively charterers progress into the January program during the upcoming week will thus likely dictate the direction that rates will take for early January cargoes. Given shortened working weeks during the final two weeks of the year, charterers could reach forward on dates (as the market already is observing) during the upcoming week to cover requirements ahead of the holidays. Against the tight supply/demand profile, this would imply an extending of the present rate rally. Further forward, as the market moves past the first half of the January program and forward fixing windows normalize, the reappearance of units presently on trades to points in the east on Middle East position lists should see rates start to correct”, C.R. Weber concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Friday, 19 December 14
HOW WILL LOWER BUNKER PRICES AFFECT THE SUBSTANTIAL OVERCAPACITY IN DRY BULK MARKET? - BIMCO
As bunker fuel costs have come down from USD 600 per tonnes to USD 330 per tonnes in the past 6 months, much talk about increased ship speed have s ...
Friday, 19 December 14
U.S WEEKLY COAL PRODUCTION REACHED APPROXIMATELY 19.8 MMST; UP 1.0% WOW
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.8 million short tons (mmst) of coal ...
Friday, 19 December 14
HANDY: SOFTER TONE; PANAMAX: QUIET WEEK; CAPESIZE; PAINFUL WEEK
Handy
A softer tone for rates and volumes for the Supras, perhaps less apparent in the Pacific the last week before the season holidays and good ...
Thursday, 18 December 14
INDONESIA TO REVISE UP COAL OUTPUT TARGET TO 460 MILLION TONS IN 2015
COALspot.com: Indonesian government has revised up its next year coal output forecast to 460 million tons from its previous forecast of 421 million ...
Wednesday, 17 December 14
CAPES RATES SLIPPED BELOW $5,600/DAY, FELL 84% YOY
COALspot.com: In the very rare occurrence when the BCI stands below the BDI, words to describe market sentiment are probably poor, said Intermodal ...
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- Parry Sugars Refinery, India
- Electricity Authority, New Zealand
- GAC Shipping (India) Pvt Ltd
- Maheswari Brothers Coal Limited - India
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Bharathi Cement Corporation - India
- Madhucon Powers Ltd - India
- CNBM International Corporation - China
- Kobexindo Tractors - Indoneisa
- Bukit Makmur.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Samtan Co., Ltd - South Korea
- Gujarat Sidhee Cement - India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- VISA Power Limited - India
- Singapore Mercantile Exchange
- Bhushan Steel Limited - India
- Simpson Spence & Young - Indonesia
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- CIMB Investment Bank - Malaysia
- Ministry of Finance - Indonesia
- Australian Commodity Traders Exchange
- London Commodity Brokers - England
- Ind-Barath Power Infra Limited - India
- Meralco Power Generation, Philippines
- Kumho Petrochemical, South Korea
- Kapuas Tunggal Persada - Indonesia
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bukit Baiduri Energy - Indonesia
- Wood Mackenzie - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Bangladesh Power Developement Board
- TeaM Sual Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Thiess Contractors Indonesia
- Barasentosa Lestari - Indonesia
- Billiton Holdings Pty Ltd - Australia
- India Bulls Power Limited - India
- Attock Cement Pakistan Limited
- AsiaOL BioFuels Corp., Philippines
- Straits Asia Resources Limited - Singapore
- Marubeni Corporation - India
- SN Aboitiz Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Medco Energi Mining Internasional
- Cigading International Bulk Terminal - Indonesia
- Borneo Indobara - Indonesia
- International Coal Ventures Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Standard Chartered Bank - UAE
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- MS Steel International - UAE
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- Dalmia Cement Bharat India
- Central Electricity Authority - India
- Riau Bara Harum - Indonesia
- Oldendorff Carriers - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Independent Power Producers Association of India
- The University of Queensland
- Timah Investasi Mineral - Indoneisa
- Anglo American - United Kingdom
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- OPG Power Generation Pvt Ltd - India
- GVK Power & Infra Limited - India
- The Treasury - Australian Government
- Indogreen Group - Indonesia
- ASAPP Information Group - India
- Vedanta Resources Plc - India
- Chettinad Cement Corporation Ltd - India
- Iligan Light & Power Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Edison Trading Spa - Italy
- Eastern Coal Council - USA
- Ministry of Transport, Egypt
- Bukit Asam (Persero) Tbk - Indonesia
- Georgia Ports Authority, United States
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Sinarmas Energy and Mining - Indonesia
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Star Paper Mills Limited - India
- Essar Steel Hazira Ltd - India
- Bhoruka Overseas - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Trasteel International SA, Italy
- Holcim Trading Pte Ltd - Singapore
- Malabar Cements Ltd - India
- Siam City Cement - Thailand
- Cement Manufacturers Association - India
- Semirara Mining and Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- Minerals Council of Australia
- GMR Energy Limited - India
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Mercuria Energy - Indonesia
- Makarim & Taira - Indonesia
- Parliament of New Zealand
- Indian Energy Exchange, India
- Tata Chemicals Ltd - India
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Directorate Of Revenue Intelligence - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Altura Mining Limited, Indonesia
- The State Trading Corporation of India Ltd
- Price Waterhouse Coopers - Russia
- European Bulk Services B.V. - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Green Power PLC Corporation, Philippines
- Sakthi Sugars Limited - India
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- Vizag Seaport Private Limited - India
- Heidelberg Cement - Germany
- Posco Energy - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- Sarangani Energy Corporation, Philippines
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- Videocon Industries ltd - India
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Chamber of Mines of South Africa
- PowerSource Philippines DevCo
- Pipit Mutiara Jaya. PT, Indonesia
- Coal and Oil Company - UAE
- Krishnapatnam Port Company Ltd. - India
- Uttam Galva Steels Limited - India
- Bulk Trading Sa - Switzerland
- Grasim Industreis Ltd - India
- Romanian Commodities Exchange
- LBH Netherlands Bv - Netherlands
- IEA Clean Coal Centre - UK
- Orica Mining Services - Indonesia
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- Jindal Steel & Power Ltd - India
- Goldman Sachs - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Jorong Barutama Greston.PT - Indonesia
- Energy Link Ltd, New Zealand
- Kaltim Prima Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Jaiprakash Power Ventures ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Baramulti Group, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Aditya Birla Group - India
- Alfred C Toepfer International GmbH - Germany
- Global Business Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Indian Oil Corporation Limited
- Planning Commission, India
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Wilmar Investment Holdings
- Ministry of Mines - Canada
- PTC India Limited - India
- Australian Coal Association
- Kartika Selabumi Mining - Indonesia
- SMG Consultants - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kepco SPC Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- White Energy Company Limited
- Electricity Generating Authority of Thailand
- Aboitiz Power Corporation - Philippines
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Indika Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- South Luzon Thermal Energy Corporation
- Kideco Jaya Agung - Indonesia
- ICICI Bank Limited - India
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- TNB Fuel Sdn Bhd - Malaysia
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Energy Development Corp, Philippines
- Coastal Gujarat Power Limited - India
- Renaissance Capital - South Africa
- Asmin Koalindo Tuhup - Indonesia
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Economic Council, Georgia
- Sojitz Corporation - Japan
- Metalloyd Limited - United Kingdom
- Savvy Resources Ltd - HongKong
- Binh Thuan Hamico - Vietnam
- Therma Luzon, Inc, Philippines
- Port Waratah Coal Services - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
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