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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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Tuesday, 30 December 14
U.S WEEKLY COAL PRODUCTION ALMOST FLAT AT -0.2%
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.8 million short tons (mmst) of coal ...
Monday, 29 December 14
CHINESE COAL IMPORTS: REGULATORY RISKS? - CLARKSONS
In recent years, Chinese seaborne coal imports have surged, registering average growth of 67% p.a. between 2009 and 2013 to total 265mt. However, t ...
Monday, 29 December 14
BULK MARKET ENDS YEAR ON SOUR NOTE, SHIPBROKER SEES 'BUMPY ROAD AHEAD' - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
2014 was supposed to be the year that the dry bulk market would stage a comeback and a sustainable one for that matter. However, while for the most ...
Monday, 29 December 14
Q1'15 CFR SOUTH CHINA COAL SWAP CLOSED AT $59.42
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2015 delivery has decreased by US$ 3.51 (-5.58%) month over month and US$ 0.08 (-0.13%) ...
Monday, 29 December 14
SGX'S FOB NEWCASTLE COAL SWAPS IMPROVED W-O-W, LOST M-O-M
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery lost US$ 1.44 per MT (-2.73%) month over month and gained US$ 0.36 (+0.71%) ...
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- Lanco Infratech Ltd - India
- Marubeni Corporation - India
- Pendopo Energi Batubara - Indonesia
- Bulk Trading Sa - Switzerland
- Toyota Tsusho Corporation, Japan
- Petron Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Rashtriya Ispat Nigam Limited - India
- London Commodity Brokers - England
- Independent Power Producers Association of India
- Bhoruka Overseas - Indonesia
- VISA Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Parliament of New Zealand
- Indogreen Group - Indonesia
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- The University of Queensland
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- Tata Chemicals Ltd - India
- Sindya Power Generating Company Private Ltd
- GN Power Mariveles Coal Plant, Philippines
- Mercuria Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bhushan Steel Limited - India
- PTC India Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Australian Commodity Traders Exchange
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- The Treasury - Australian Government
- PetroVietnam Power Coal Import and Supply Company
- Bahari Cakrawala Sebuku - Indonesia
- Larsen & Toubro Limited - India
- ICICI Bank Limited - India
- Posco Energy - South Korea
- Attock Cement Pakistan Limited
- Uttam Galva Steels Limited - India
- Sakthi Sugars Limited - India
- Savvy Resources Ltd - HongKong
- The State Trading Corporation of India Ltd
- Dalmia Cement Bharat India
- Bangladesh Power Developement Board
- Jorong Barutama Greston.PT - Indonesia
- Georgia Ports Authority, United States
- Bank of Tokyo Mitsubishi UFJ Ltd
- Orica Australia Pty. Ltd.
- Miang Besar Coal Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Romanian Commodities Exchange
- Minerals Council of Australia
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- SN Aboitiz Power Inc, Philippines
- Semirara Mining Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Vizag Seaport Private Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bharathi Cement Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Central Java Power - Indonesia
- Merrill Lynch Commodities Europe
- Ministry of Transport, Egypt
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Samtan Co., Ltd - South Korea
- White Energy Company Limited
- SMG Consultants - Indonesia
- Carbofer General Trading SA - India
- Commonwealth Bank - Australia
- Tamil Nadu electricity Board
- Altura Mining Limited, Indonesia
- Orica Mining Services - Indonesia
- Economic Council, Georgia
- Ministry of Mines - Canada
- Global Green Power PLC Corporation, Philippines
- Australian Coal Association
- European Bulk Services B.V. - Netherlands
- Heidelberg Cement - Germany
- CIMB Investment Bank - Malaysia
- McConnell Dowell - Australia
- Deloitte Consulting - India
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Coalindo Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Mercator Lines Limited - India
- OPG Power Generation Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- CNBM International Corporation - China
- Chettinad Cement Corporation Ltd - India
- Kumho Petrochemical, South Korea
- GAC Shipping (India) Pvt Ltd
- Wilmar Investment Holdings
- Thai Mozambique Logistica
- Directorate General of MIneral and Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Salva Resources Pvt Ltd - India
- Vedanta Resources Plc - India
- SMC Global Power, Philippines
- Power Finance Corporation Ltd., India
- Bukit Asam (Persero) Tbk - Indonesia
- ASAPP Information Group - India
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Barasentosa Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Malabar Cements Ltd - India
- Siam City Cement PLC, Thailand
- Mintek Dendrill Indonesia
- Indo Tambangraya Megah - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- GMR Energy Limited - India
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- Billiton Holdings Pty Ltd - Australia
- Kaltim Prima Coal - Indonesia
- Makarim & Taira - Indonesia
- Ambuja Cements Ltd - India
- Sojitz Corporation - Japan
- Globalindo Alam Lestari - Indonesia
- Latin American Coal - Colombia
- Timah Investasi Mineral - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Coal Blending Company Limited - Australia
- Ministry of Finance - Indonesia
- Xindia Steels Limited - India
- Oldendorff Carriers - Singapore
- Manunggal Multi Energi - Indonesia
- Thiess Contractors Indonesia
- Therma Luzon, Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Goldman Sachs - Singapore
- Electricity Generating Authority of Thailand
- Medco Energi Mining Internasional
- Planning Commission, India
- Aditya Birla Group - India
- Intertek Mineral Services - Indonesia
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- Price Waterhouse Coopers - Russia
- Electricity Authority, New Zealand
- Sree Jayajothi Cements Limited - India
- Ceylon Electricity Board - Sri Lanka
- Renaissance Capital - South Africa
- Simpson Spence & Young - Indonesia
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Aboitiz Power Corporation - Philippines
- Indonesian Coal Mining Association
- Coastal Gujarat Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Sical Logistics Limited - India
- Sarangani Energy Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Africa Commodities Group - South Africa
- Interocean Group of Companies - India
- Agrawal Coal Company - India
- Port Waratah Coal Services - Australia
- Gujarat Electricity Regulatory Commission - India
- Maheswari Brothers Coal Limited - India
- PowerSource Philippines DevCo
- LBH Netherlands Bv - Netherlands
- Singapore Mercantile Exchange
- Eastern Coal Council - USA
- Antam Resourcindo - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- Karaikal Port Pvt Ltd - India
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Energy Development Corp, Philippines
- Trasteel International SA, Italy
- MS Steel International - UAE
- Borneo Indobara - Indonesia
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- Star Paper Mills Limited - India
- Global Business Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- San Jose City I Power Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- IHS Mccloskey Coal Group - USA
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Standard Chartered Bank - UAE
- Formosa Plastics Group - Taiwan
- Meenaskhi Energy Private Limited - India
- Baramulti Group, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- International Coal Ventures Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Cement Manufacturers Association - India
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- Jaiprakash Power Ventures ltd
- Anglo American - United Kingdom
- Kideco Jaya Agung - Indonesia
- Coal and Oil Company - UAE
- IEA Clean Coal Centre - UK
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