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Wednesday, 07 January 15
FUEL EFFICIENT SHIPS MAKE LESS SENSE IN LOWER BUNKER PRICE MARKET, BUT FUEL COSTS ARE BOUND TO RISE AGAIN
 The shipping industry entered 2015 on mixed emotions, as a relatively buoyant tanker market is met by a rather lackluster dry bulk market. Still, all ship owners will undoubtedly be happy about the fact that the most important cost driving factor, bunker prices, are way down since the same period of last year. In fact, bunker prices are down by more than 30% since last year, as already, by the end of November of 2014, the cost of Heavy Fuel Oil (HFO) in Fujairah had declined to $460 per metric ton from an average of $609/mt over the first six months of 2014. That’s already a reduction of 24% and more has come since then, on the back of constantly declining crude prices.
Given the fact that bunker prices is the biggest factor in a ship’s operating costs, that kind of reduction is rather significant and one which can offset any loss in terms of freight rates. Thus, ship owners can take advantage of this low cost environment and increase their earnings, through the subsequent fall of OPEX. On the other hand, other factor like the new fuel efficient vessels, or slow steaming are coming into play.
According to a recent report from Poten & Partners, “due to the high oil prices over the last couple of years and the anticipation of continuing high prices in the future, owners have made operational adjustments by utilizing slow steaming on the ballast leg of a voyage, while shipyards and engine manufacturers have worked hard to improve the fuel efficiency of new ships. Using a VLCC as the basis for such analysis as the longer voyages benefit relatively more from fuel efficiency, we use a 2007 built VLCC ordered when HFO prices were around $160/MT and a modern 2013 built VLCC. Vessels can vary significantly in their fuel consumption, both through design and over time, dependent on the condition of the hull paint, etc. The modern vessel in our example saves 7 tons/day in laden condition compared to the older design and 4 tons/day while in ballast. For the comparison we will use the typical VLCC round trip voyage from Ras Tanura to Chiba using the current fuel price ($460/MT) and the average price during the first 6 months of 2014 ($609/MT). On the round trip, the fuel efficient vessel saves $116,200 in fuel with current prices and $151,500 in the higher price environment compared to the 2007 built vessel. This represents savings of $2,179/day in time charter equivalent (TCE) at current bunker prices and $2,839 at 2014H1 bunker prices”.
Poten added that “in order to improve TCE, owners have made operational adjustments by slow steaming during the ballast leg of the voyages, and during the laden leg where it was permitted in the charter party. This helps the owners by improving the economics on individual voyages as the fuel cost savings more than offset the longer steaming time when the market is low. An added benefit is that slow steaming reduces the efficiency or the fleet as more vessels are needed to move the same volume of cargo. Earlier in the year, when the rates were lower, slow steaming made more sense as the additional revenue that could be earned during the additional 3.9 ballasting days was lower than the fuel savings. At current market rates and lower bunker prices, this situation has shifted. At least for the vessel and voyage combination in our example, increasing the ballast speed could prove to be beneficial. The situation could be different for other vessels and voyages, but it makes the case for owners to run the numbers. The benefits of fuel efficient designs might have been reduced for now but the investment is for 20+ years and fuel prices are likely to increase again in the future”, the analyst concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Wednesday, 14 January 15
DRY BULK MARKET NOTED ANOTHER WEEKLY DECLINE - INTERMODAL
COALspot.com: The Dry bulk market noted another weekly decline on Friday, with the performance of the Capesize market still weighing down on the re ...
Wednesday, 14 January 15
MARKET INSIGHT - TIMOS PAPADIMITRIOU
In Oil we trust! The Barrel price has declined by almost a third in comparison to the 2014 January and has being on the downhill since early last s ...
Wednesday, 14 January 15
COMMODITIES AREN'T PRIMED FOR A REBOUND DURING 2015: SHIPPING COULD BENEFIT FROM LOWER PRICES - ROUSSANOGLOU, HELLENIC SHIPPING NEWS
In the recent past, higher commodity prices were driven by an increase in demand from developing countries, which spelled good news for ship owners ...
Wednesday, 14 January 15
SUB-BIT FOB INDONESIA COAL SWAP FOR Q1 DELIVERY CLOSED AT US$ 46.97 PMT
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 declined month on month and week over week.
The Q1 swap has fell US$ 1.53 (-3.15 ...
Wednesday, 14 January 15
Q4' 15 FOB NEWCASTLE COAL SWAP CLOSED 4.51% LOWER COMPARED TO Q1' 15 PRICE
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery lost US$ 1.56 per MT (-3.0%) month over month and US$ 1.03 (-2.0%) week ove ...
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- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Bhoruka Overseas - Indonesia
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Altura Mining Limited, Indonesia
- Siam City Cement - Thailand
- Posco Energy - South Korea
- Eastern Coal Council - USA
- Tata Chemicals Ltd - India
- Sakthi Sugars Limited - India
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- Gujarat Sidhee Cement - India
- Parliament of New Zealand
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- Orica Australia Pty. Ltd.
- Ministry of Mines - Canada
- Metalloyd Limited - United Kingdom
- Ceylon Electricity Board - Sri Lanka
- Indo Tambangraya Megah - Indonesia
- Savvy Resources Ltd - HongKong
- London Commodity Brokers - England
- Marubeni Corporation - India
- Mercator Lines Limited - India
- Baramulti Group, Indonesia
- Georgia Ports Authority, United States
- AsiaOL BioFuels Corp., Philippines
- Intertek Mineral Services - Indonesia
- Bharathi Cement Corporation - India
- GAC Shipping (India) Pvt Ltd
- GMR Energy Limited - India
- Bukit Baiduri Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Riau Bara Harum - Indonesia
- Global Coal Blending Company Limited - Australia
- Semirara Mining and Power Corporation, Philippines
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Krishnapatnam Port Company Ltd. - India
- Minerals Council of Australia
- Vedanta Resources Plc - India
- LBH Netherlands Bv - Netherlands
- Globalindo Alam Lestari - Indonesia
- Bhushan Steel Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Cigading International Bulk Terminal - Indonesia
- IEA Clean Coal Centre - UK
- MS Steel International - UAE
- Rio Tinto Coal - Australia
- Electricity Generating Authority of Thailand
- Jorong Barutama Greston.PT - Indonesia
- Xindia Steels Limited - India
- Carbofer General Trading SA - India
- Cement Manufacturers Association - India
- Merrill Lynch Commodities Europe
- San Jose City I Power Corp, Philippines
- The Treasury - Australian Government
- Mintek Dendrill Indonesia
- Ministry of Transport, Egypt
- Independent Power Producers Association of India
- Banpu Public Company Limited - Thailand
- Bangladesh Power Developement Board
- Kumho Petrochemical, South Korea
- The State Trading Corporation of India Ltd
- Petron Corporation, Philippines
- Bhatia International Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Borneo Indobara - Indonesia
- Ind-Barath Power Infra Limited - India
- Siam City Cement PLC, Thailand
- Holcim Trading Pte Ltd - Singapore
- Chettinad Cement Corporation Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Attock Cement Pakistan Limited
- Sojitz Corporation - Japan
- Vijayanagar Sugar Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Interocean Group of Companies - India
- SMC Global Power, Philippines
- Barasentosa Lestari - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Global Green Power PLC Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Petrochimia International Co. Ltd.- Taiwan
- TNB Fuel Sdn Bhd - Malaysia
- Pendopo Energi Batubara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Directorate General of MIneral and Coal - Indonesia
- Global Business Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Maheswari Brothers Coal Limited - India
- Anglo American - United Kingdom
- Offshore Bulk Terminal Pte Ltd, Singapore
- Chamber of Mines of South Africa
- CNBM International Corporation - China
- Orica Mining Services - Indonesia
- Energy Link Ltd, New Zealand
- Goldman Sachs - Singapore
- Therma Luzon, Inc, Philippines
- Videocon Industries ltd - India
- Manunggal Multi Energi - Indonesia
- Meralco Power Generation, Philippines
- Kepco SPC Power Corporation, Philippines
- Australian Commodity Traders Exchange
- GVK Power & Infra Limited - India
- Price Waterhouse Coopers - Russia
- Pipit Mutiara Jaya. PT, Indonesia
- Meenaskhi Energy Private Limited - India
- Ministry of Finance - Indonesia
- Planning Commission, India
- Mercuria Energy - Indonesia
- Thiess Contractors Indonesia
- Renaissance Capital - South Africa
- Oldendorff Carriers - Singapore
- Bulk Trading Sa - Switzerland
- Binh Thuan Hamico - Vietnam
- Wood Mackenzie - Singapore
- Deloitte Consulting - India
- Antam Resourcindo - Indonesia
- Essar Steel Hazira Ltd - India
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Power Finance Corporation Ltd., India
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Agrawal Coal Company - India
- PowerSource Philippines DevCo
- Kohat Cement Company Ltd. - Pakistan
- SMG Consultants - Indonesia
- TeaM Sual Corporation - Philippines
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- IHS Mccloskey Coal Group - USA
- Coastal Gujarat Power Limited - India
- Indian Energy Exchange, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Romanian Commodities Exchange
- VISA Power Limited - India
- Grasim Industreis Ltd - India
- Iligan Light & Power Inc, Philippines
- Central Java Power - Indonesia
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- The University of Queensland
- Electricity Authority, New Zealand
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- Larsen & Toubro Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kaltim Prima Coal - Indonesia
- Malabar Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Latin American Coal - Colombia
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- Standard Chartered Bank - UAE
- ASAPP Information Group - India
- Neyveli Lignite Corporation Ltd, - India
- Sarangani Energy Corporation, Philippines
- Port Waratah Coal Services - Australia
- Timah Investasi Mineral - Indoneisa
- Eastern Energy - Thailand
- International Coal Ventures Pvt Ltd - India
- Coalindo Energy - Indonesia
- Economic Council, Georgia
- Heidelberg Cement - Germany
- Kapuas Tunggal Persada - Indonesia
- Africa Commodities Group - South Africa
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Edison Trading Spa - Italy
- Semirara Mining Corp, Philippines
- ICICI Bank Limited - India
- Indonesian Coal Mining Association
- Rashtriya Ispat Nigam Limited - India
- Star Paper Mills Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Karaikal Port Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Tamil Nadu electricity Board
- Aboitiz Power Corporation - Philippines
- Wilmar Investment Holdings
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- Jindal Steel & Power Ltd - India
- Kartika Selabumi Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Commonwealth Bank - Australia
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- Simpson Spence & Young - Indonesia
- Salva Resources Pvt Ltd - India
- White Energy Company Limited
- South Luzon Thermal Energy Corporation
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Coal and Oil Company - UAE
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Makarim & Taira - Indonesia
- Vizag Seaport Private Limited - India
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