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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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Monday, 12 January 15
SHIPPING - CHALLENGES AND RESOLUTIONS - EVA TZIMA
Last year has without a doubt been another challenging one both for both our industry and our country. As Greece is currently dominated by election ...
Sunday, 11 January 15
BDI DECLINED 8% ON WEEK; BCI LOST 31%
COALspot.com: The BDI continued its decline in the first week of this year or lost 8 pct week over week. The BDI was closed at 709 points whi ...
Friday, 09 January 15
U.S. EASTERN SPOT STEAM COAL PRICES FELL IN 2014; ROSE IN WEST - EIA
U.S. Eastern spot steam coal prices declined in 2014 compared to 2013 levels because of a decline in steam coal exports.
According to U.S. Ene ...
Friday, 09 January 15
WEEKLY U.S. COAL PRODUCTION UP AN ESTIMATED 2.2% Y-O-Y
COALspot.com – United States the world's one of the largest coal producers, produced approximately 17.6 million short tons (mmst) of coal ...
Thursday, 08 January 15
INDONESIA PRESSES ON WITH HIGHER COAL ROYALTY FEE TO BOOST STATE REVENUE - JG
The Indonesian government is pressing on with its plan to raise the royalty charged to coal miners in order to increase state revenue, but the move ...
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- Jindal Steel & Power Ltd - India
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- Port Waratah Coal Services - Australia
- Global Coal Blending Company Limited - Australia
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Indogreen Group - Indonesia
- Barasentosa Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- OPG Power Generation Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Rashtriya Ispat Nigam Limited - India
- Price Waterhouse Coopers - Russia
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- Planning Commission, India
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- Videocon Industries ltd - India
- Banpu Public Company Limited - Thailand
- Rio Tinto Coal - Australia
- Billiton Holdings Pty Ltd - Australia
- Goldman Sachs - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Wood Mackenzie - Singapore
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Attock Cement Pakistan Limited
- Energy Development Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Medco Energi Mining Internasional
- IHS Mccloskey Coal Group - USA
- Jaiprakash Power Ventures ltd
- PTC India Limited - India
- Malabar Cements Ltd - India
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- Baramulti Group, Indonesia
- Wilmar Investment Holdings
- LBH Netherlands Bv - Netherlands
- Grasim Industreis Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- Salva Resources Pvt Ltd - India
- Edison Trading Spa - Italy
- Georgia Ports Authority, United States
- Formosa Plastics Group - Taiwan
- Vijayanagar Sugar Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Mines - Canada
- Commonwealth Bank - Australia
- Maharashtra Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Binh Thuan Hamico - Vietnam
- Indika Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- Manunggal Multi Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Mintek Dendrill Indonesia
- Ministry of Finance - Indonesia
- Larsen & Toubro Limited - India
- San Jose City I Power Corp, Philippines
- Semirara Mining Corp, Philippines
- Parry Sugars Refinery, India
- The State Trading Corporation of India Ltd
- Gujarat Electricity Regulatory Commission - India
- Bangladesh Power Developement Board
- Indo Tambangraya Megah - Indonesia
- ICICI Bank Limited - India
- Economic Council, Georgia
- CNBM International Corporation - China
- Central Java Power - Indonesia
- Mercator Lines Limited - India
- SN Aboitiz Power Inc, Philippines
- Bhushan Steel Limited - India
- Borneo Indobara - Indonesia
- Trasteel International SA, Italy
- Latin American Coal - Colombia
- Anglo American - United Kingdom
- Bulk Trading Sa - Switzerland
- Star Paper Mills Limited - India
- Independent Power Producers Association of India
- Renaissance Capital - South Africa
- Pendopo Energi Batubara - Indonesia
- Tamil Nadu electricity Board
- Holcim Trading Pte Ltd - Singapore
- Ministry of Transport, Egypt
- Madhucon Powers Ltd - India
- Bharathi Cement Corporation - India
- Aboitiz Power Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Riau Bara Harum - Indonesia
- Central Electricity Authority - India
- Aditya Birla Group - India
- Singapore Mercantile Exchange
- Indonesian Coal Mining Association
- Australian Commodity Traders Exchange
- Orica Mining Services - Indonesia
- Sojitz Corporation - Japan
- SMC Global Power, Philippines
- Miang Besar Coal Terminal - Indonesia
- Minerals Council of Australia
- McConnell Dowell - Australia
- TeaM Sual Corporation - Philippines
- Mjunction Services Limited - India
- Kideco Jaya Agung - Indonesia
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Meralco Power Generation, Philippines
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Electricity Authority, New Zealand
- MS Steel International - UAE
- Australian Coal Association
- Semirara Mining and Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Kaltim Prima Coal - Indonesia
- Coal and Oil Company - UAE
- Agrawal Coal Company - India
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
- Global Green Power PLC Corporation, Philippines
- Mercuria Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Eastern Coal Council - USA
- Makarim & Taira - Indonesia
- Ind-Barath Power Infra Limited - India
- Coastal Gujarat Power Limited - India
- Chamber of Mines of South Africa
- Sindya Power Generating Company Private Ltd
- Timah Investasi Mineral - Indoneisa
- Intertek Mineral Services - Indonesia
- Petron Corporation, Philippines
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Bukit Makmur.PT - Indonesia
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Deloitte Consulting - India
- Gujarat Mineral Development Corp Ltd - India
- Bukit Baiduri Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Kepco SPC Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Ceylon Electricity Board - Sri Lanka
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parliament of New Zealand
- Energy Link Ltd, New Zealand
- Indian Energy Exchange, India
- Thai Mozambique Logistica
- Standard Chartered Bank - UAE
- Toyota Tsusho Corporation, Japan
- Tata Chemicals Ltd - India
- Globalindo Alam Lestari - Indonesia
- The Treasury - Australian Government
- Straits Asia Resources Limited - Singapore
- Africa Commodities Group - South Africa
- Essar Steel Hazira Ltd - India
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Eastern Energy - Thailand
- PowerSource Philippines DevCo
- Lanco Infratech Ltd - India
- Kobexindo Tractors - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Directorate General of MIneral and Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Merrill Lynch Commodities Europe
- Sree Jayajothi Cements Limited - India
- Directorate Of Revenue Intelligence - India
- Karbindo Abesyapradhi - Indoneisa
- The University of Queensland
- Carbofer General Trading SA - India
- Meenaskhi Energy Private Limited - India
- Bayan Resources Tbk. - Indonesia
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Global Business Power Corporation, Philippines
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Cement Manufacturers Association - India
- Dalmia Cement Bharat India
- CIMB Investment Bank - Malaysia
- Posco Energy - South Korea
- Power Finance Corporation Ltd., India
- Marubeni Corporation - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- GVK Power & Infra Limited - India
- Samtan Co., Ltd - South Korea
- Sical Logistics Limited - India
- Indian Oil Corporation Limited
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