We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Sunday, 11 October 15
TANKER SHIPPING: MORE OPTIMISM IN SIGHT FOR TANKERS IN THE WINTER SEASON - BIMCO
 Demand:
2015 has been the year of the tanker. The fundamental improvements with slow supply-side growth for some years coupled with low oil prices from mid-2014 created strength on both sides. Freight rates started to take off in October 2014 for all types and sizes. The combination of an early start to the fourth-quarter seasonal strength heading into winter and the fact that the oil prices continued to slide became a catalyst.
Throughout 2015, the global refinery throughput has been on a rise. The normal seasonal lower throughput in the first half of the year with widespread maintenance did not occur. Owing to rising and already elevated refinery margins from East to West, refineries simply wanted all the crude oil they could get. This development still provides strong demand and solid freight rates for the tanker industry. In India, we saw a record of 4.74 million barrels per day (mb/d) of crude throughput in June, marking a truly global trend, whereas Middle Eastern refineries also hit a record throughput because of increased runs in Saudi Arabia.
October is traditionally another month of lower throughput as refineries get ready for the winter season when crude runs normally peak. Moreover, the American “Labor Day” on 7 September marks the end of the US driving season which started on Memorial Day, 25 May. This means that the recent 10mb/d production of gasoline will come down.
Some of that weakness may already have caused freight rates to come down sharply, in combination with the global financial uncertainties originating from China. Very large crude Carriers (VLCCs), Suezmax and Aframax have seen freight rates cut in two since mid-June, while Handysize has been the one to drop the most among oil product tankers.
In a rush of excitement, it’s easily forgotten that such high refinery crude runs can only go on for so long, if end consumption supports it. End consumption has supported it some of the way but not all the way. Swollen stocks of crude oil and oil products are now seen everywhere. Preliminary OECD total industry stock change in second-quarter was 1.1mb/d. All stocks but gasoline increased, US crude oil stocks too. In comparison global oil demand dropped by 0.1mb/d over the same period of time and is expected to see an increase of 1.6mb/d to be consumed for the full year over 2014.
Supply:
Contrary to what happens too often, the strong freight markets for oil product tankers have not resulted in a knee-jerk run to the shipyard to order a massive amount of new ships. This stands in opposition to the crude oil tanker orders seen in 2015, as if the lid has come off finally after several years of resisting the temptation.
By end-August 2015, 56 product tankers with a total capacity of 4.8 million DWT, predominantly LR2 (20) and LR1 (21), have been ordered and will be delivered in 2016-17. They are aiming to get a share of the market for longer-haul trades out of Middle East refineries, predominantly into the Western markets. This ordering trend has been on for two years now.
Among the crude oil tanker segments, we have already seen more orders for both Aframax and VLCCs than we did in the whole of 2014. Aframax in particular has been popular with investors this year; after six years with one order a month on average, 2015 has seen 29 new contracts in the first eight months. For the VLCCs, the orders with delivery in particular 2017 (21) and in 2018 (14) have been favoured by investors. In 2015, 50 new VLCC contracts in total have been signed.
One of the launchers which has lifted the freight rates into orbit is two years of very slow fleet growth. Today the fleet holds 648 VLCCs, whereas 628 VLCCs were active by mid-2013. That’s a growth of just 3% in 26 months. Looking forward into the future inflow of crude oil tankers, we can see the delivery pace is picking up and the demolition potential is vanishing with just 14 VLCCs being more than 20 years old and another 16 getting inside the window of the fourth special survey in 2016.
On order for a scheduled delivery during the next 16 months are 71 VLCCs. This means a double-paced inflow as it has taken 34 months for the latest 71 VLCCs to be put into active service.
The change in supply-side conditions will slowly tighten the freight market, and as we look into 2016, the tide could turn fundamentally as a fleet growth of 4.4% is likely to outstrip demand growth. As the coming two years are now “full” in terms of remaining in control of supply-side growth, any additional crude oil tanker orders should be placed for 2018 delivery.
BIMCO forecasts the present and next year supply growth for oil product tankers to be at 5.4% and 5.7% respectively, meaning two “full” years too for that segment.
Outlook:
Looking forward, the winter markets are expected to soften, as the eventual lower refinery crude oil throughput when no more stocks can be filled and margins begin to crumble as demand slips. Until then BIMCO expects earnings for both crude oil and oil product tankers to remain strong. Our expectations are primarily supported by low fleet growth for crude oil tankers and long-haul trades for oil product tankers.
High volatility in freight rates can be expected in the coming half year half a year, when it may also be prudent to look at the time charter market, where one- and three-year time charter rates are both at their highest level since 2009. At USD 48,000 per day and USD 43,500 per day, time charters will make positive returns after all costs inclusive of capital cost and depreciations are deducted.
In the longer run, an eventual repeal of the US crude oil export ban will likely have some impact on the tanker trading lanes. The US congress is set to vote on the issues during this autumn. For the supporters the case is clear: US refineries are saturated with light sweet crude which is produced abundantly. For those in favour of keeping the crude oil export ban still in place there is “national interest”, which currently seems to hold the upper hand. Currently, the only crude oil exports today go to Canada (0.5mb/d).
Moreover, the eventual lifting of international sanctions on Iran is likely to see a steady increase in crude oil, both sweet and sour, into the market over the coming one to three years, depending on much-needed investments to boost production and time to regain market shares. BIMCO expects the re-entry of Iranian crude oil into the market will change trade patterns as other suppliers will be squeezed on their market share. The key will be West African produced sweet crude now going to Europe and East Asia. The latter is the vital one and a stronghold behind the current upturn. The overall impact on the tanker earnings from these changes holds the potential to become both negative and positive.
Source: BIMCO | Hellenic Shipping News
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Monday, 05 October 15
Q1' 16 CFR SOUTH CHINA COAL SWAP CLOSED US$ 48.05 PER TON
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery down US$ 0.47 (0.96 %) per ton month over month.
A commodity swap is ...
Monday, 05 October 15
SMALL DECLINE IN 2014 SHIP OPERATING COSTS - MOORE STEPHENS
Total annual operating costs in the shipping industry fell by an average of 0.8% in 2014. This compares with the 0.3% average fall in costs recorde ...
Sunday, 04 October 15
THE INDO-INDIA FREIGHT MARKET REMAINS UNDER PRESSURE
COALspot.com: The BDI closed on Friday (2 Oct 2015) at 889 points, down by 54 points compared to previous Friday's closing ( 24 Sept 2015) of 9 ...
Friday, 02 October 15
COAL PRODUCTION IN THE UNITED STATES DECREASED THIS WEEK - EIA
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 17.5 million shor ...
Thursday, 01 October 15
SOUTH KOREA'S KOMIPO SEEKS SPOT BITUMINOUS COAL SUPPLIES
COALspot.com: South Korean state-owned utility Korea Midland Power (KOMIPO) issued an new tender for 265,000 Metric Tons (MT) of minimum 4,600 kcal ...
|
|
|
Showing 2786 to 2790 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- Savvy Resources Ltd - HongKong
- Makarim & Taira - Indonesia
- Cement Manufacturers Association - India
- Kapuas Tunggal Persada - Indonesia
- Thai Mozambique Logistica
- Xindia Steels Limited - India
- Kideco Jaya Agung - Indonesia
- McConnell Dowell - Australia
- Australian Coal Association
- Therma Luzon, Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Bharathi Cement Corporation - India
- Baramulti Group, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- IHS Mccloskey Coal Group - USA
- Straits Asia Resources Limited - Singapore
- Antam Resourcindo - Indonesia
- GVK Power & Infra Limited - India
- Wood Mackenzie - Singapore
- Orica Australia Pty. Ltd.
- Cigading International Bulk Terminal - Indonesia
- Ministry of Finance - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- Billiton Holdings Pty Ltd - Australia
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Holcim Trading Pte Ltd - Singapore
- Mercator Lines Limited - India
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- Thiess Contractors Indonesia
- Coastal Gujarat Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Star Paper Mills Limited - India
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Electricity Generating Authority of Thailand
- Central Electricity Authority - India
- Jindal Steel & Power Ltd - India
- Eastern Energy - Thailand
- Kumho Petrochemical, South Korea
- Uttam Galva Steels Limited - India
- Minerals Council of Australia
- Edison Trading Spa - Italy
- Trasteel International SA, Italy
- Central Java Power - Indonesia
- Energy Development Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Toyota Tsusho Corporation, Japan
- Binh Thuan Hamico - Vietnam
- Merrill Lynch Commodities Europe
- The Treasury - Australian Government
- Sarangani Energy Corporation, Philippines
- Eastern Coal Council - USA
- Bayan Resources Tbk. - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Videocon Industries ltd - India
- Marubeni Corporation - India
- IEA Clean Coal Centre - UK
- Chettinad Cement Corporation Ltd - India
- Ministry of Mines - Canada
- Ambuja Cements Ltd - India
- Africa Commodities Group - South Africa
- Indogreen Group - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Planning Commission, India
- Carbofer General Trading SA - India
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- GAC Shipping (India) Pvt Ltd
- ICICI Bank Limited - India
- Kartika Selabumi Mining - Indonesia
- Petron Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Intertek Mineral Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Coalindo Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Attock Cement Pakistan Limited
- Samtan Co., Ltd - South Korea
- Altura Mining Limited, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- VISA Power Limited - India
- Semirara Mining Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Banpu Public Company Limited - Thailand
- Power Finance Corporation Ltd., India
- Riau Bara Harum - Indonesia
- Anglo American - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Georgia Ports Authority, United States
- Australian Commodity Traders Exchange
- Oldendorff Carriers - Singapore
- Krishnapatnam Port Company Ltd. - India
- AsiaOL BioFuels Corp., Philippines
- Indika Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Directorate General of MIneral and Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement - Thailand
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Indian Energy Exchange, India
- Global Coal Blending Company Limited - Australia
- Aditya Birla Group - India
- Romanian Commodities Exchange
- Global Green Power PLC Corporation, Philippines
- Ministry of Transport, Egypt
- PNOC Exploration Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Madhucon Powers Ltd - India
- Orica Mining Services - Indonesia
- PTC India Limited - India
- Parliament of New Zealand
- Mintek Dendrill Indonesia
- India Bulls Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Interocean Group of Companies - India
- Indonesian Coal Mining Association
- Grasim Industreis Ltd - India
- White Energy Company Limited
- Rio Tinto Coal - Australia
- The University of Queensland
- Borneo Indobara - Indonesia
- Posco Energy - South Korea
- PetroVietnam Power Coal Import and Supply Company
- CIMB Investment Bank - Malaysia
- Parry Sugars Refinery, India
- Maheswari Brothers Coal Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Heidelberg Cement - Germany
- Bhatia International Limited - India
- Tata Chemicals Ltd - India
- MS Steel International - UAE
- Sical Logistics Limited - India
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- Gujarat Electricity Regulatory Commission - India
- Kalimantan Lumbung Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Sidhee Cement - India
- Manunggal Multi Energi - Indonesia
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- LBH Netherlands Bv - Netherlands
- Energy Link Ltd, New Zealand
- SMG Consultants - Indonesia
- Meralco Power Generation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Jaiprakash Power Ventures ltd
- South Luzon Thermal Energy Corporation
- The State Trading Corporation of India Ltd
- Essar Steel Hazira Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- Coal and Oil Company - UAE
- Chamber of Mines of South Africa
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Directorate Of Revenue Intelligence - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Baiduri Energy - Indonesia
- Sojitz Corporation - Japan
- Agrawal Coal Company - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asmin Koalindo Tuhup - Indonesia
- Singapore Mercantile Exchange
- Karbindo Abesyapradhi - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Price Waterhouse Coopers - Russia
- Wilmar Investment Holdings
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Pendopo Energi Batubara - Indonesia
- Indian Oil Corporation Limited
- Renaissance Capital - South Africa
- Rashtriya Ispat Nigam Limited - India
- TeaM Sual Corporation - Philippines
- Bukit Makmur.PT - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Port Waratah Coal Services - Australia
- Dalmia Cement Bharat India
- Standard Chartered Bank - UAE
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- CNBM International Corporation - China
- Formosa Plastics Group - Taiwan
- New Zealand Coal & Carbon
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Vedanta Resources Plc - India
- Karaikal Port Pvt Ltd - India
- Deloitte Consulting - India
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
|
| |
| |
|
