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Monday, 05 November 18
TIGHTER FUEL RULES COULD RAISE SHIPOWNERS' COSTS AND CAPEX - FITCH RATINGS
 More stringent fuel regulations regarding sulphur content could significantly increase global shipping companies’ operating costs and capex needs, Fitch Ratings says. This may negatively affect their credit quality unless they manage to pass these costs to customers. Many shipping companies have started implementing fuel surcharges to recover costs associated with the new sulphur cap regulation, but their ability to sustain these will depend on market fundamentals, which remain challenging.
Competitive dynamics may change in the longer term with companies that are less financially able to absorb additional costs, especially given higher oil prices, withdrawing from the market. Reduced competitive pressures could then support a better supply-demand balance and allow the remaining shipping companies to raise freight rates in a bid to recoup some of the extra costs. The change in shipping fuel consumption could also affect refineries.
International Maritime Organization rules requiring ships to use fuel with sulphur content no higher than 0.5% (compared with 3.5% currently) come into effect on 1 January 2020. This means that shipping companies need to switch to higher-quality and more expensive marine fuel, use special equipment (“scrubbers”) to reduce sulphur emissions or switch to alternative fuels, such as liquefied natural gas (LNG). The new regulation will apply globally. Sulphur Emission Control Areas were established in a limited number of sea areas in 2005 and the sulphur content limit for fuel in those areas was tightened to 0.1% in 2015.
The global shipping industry fuel cost bill could increase by up to USD60 billion a year as a result of the new rules from 2020 for a total merchant fleet of 60,000 vessels, according to Wood Mackenzie. According to Maersk Line, its additional fuel costs would be over USD2 billion with a cost for the container shipping industry as a whole of up to USD15 billion, based on the difference in price of fuel with 3.5% and 0.5% sulphur content.
Scrubbers could be a viable alternative for some companies, but require several million dollars in upfront investments for each ship. Furthermore, scrubbers’ manufacturing and installing capacity is limited to fitting only about 2,000 scrubbers by 2020, according to Norwegian bank SEB. The LNG option will also require investments to retrofit ship engines and capacity to carry high-volume LNG tanks. In addition, LNG refuelling infrastructure may not be readily available globally.
The impact of the new regulation is unlikely to be uniform across segments. Ship owners that lease out ships with fuel costs borne by the charterer will be significantly less affected than operators that cover the fuel bill themselves if fuel surcharges related to the sulphur cap are not sustained.
If a significant proportion of shipping companies opt for higher-quality, low-sulphur fuel to comply with the regulations, the balance in the oil products market, and therefore refineries, may be affected. The 4 million barrel a day marine fuel market has been absorbing residue from the refining process, so there may be a need for refineries to adjust processes if demand for heavy fuel drops.
Demand for higher-quality fuel could lead to higher prices and widen pricing differentials between low- and high-sulphur products. Refineries with a higher share of middle distillates in their output, which are required to produce low-sulphur marine fuel, will benefit from the change. Low-complexity refineries will be hit and may need to invest in upgrades to shift their output towards middle distillates.
Source: Fitch Ratings
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Tuesday, 11 December 18
SHIPPING MARKET ANALYSIS - ALLIED
A lot of discussions have been made as to the effects of the IMO 2020 regulation on OPEX levels, investment feasibility of& ...
Tuesday, 11 December 18
PORT OF NEWCASTLE SHIPPED 10.849 MMT OF COAL IN NOVEMBER DOWN 23.44 PERCENT MOM
COALspot.com: The Port of Newcastle, Australia’s major trading port and the world’s largest coal export port has shipped A$ 1,574.8 mil ...
Thursday, 06 December 18
IN THE EAST, BIGGER SUPRA WAS FIXED CA US$ 10K FOR INDO-CHINA COAL ROUND - FEARNLEYS
Capesize
There is cautious optimism for the Capes, with healthier volumes and improving rates in the Pacific. West Australia round is gradually ...
Thursday, 06 December 18
U.S. COAL CONSUMPTION IN 2018 EXPECTED TO BE THE LOWEST IN 39 YEARS - EIA
EIA expects total U.S. coal consumption in 2018 to fall to 691 million short tons (MMst), a 4% decline from 2017 and the lowest level since 1979. U ...
Thursday, 06 December 18
DEMAND RISKS WEIGH ON GLOBAL SHIPPING SECTOR OUTLOOK - FITCH RATINGS
The global shipping sector outlook remains negative reflecting the demand-side risks of protectionism and slower economic growth, Fitch Ratings say ...
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Showing 1536 to 1540 news of total 6871 |
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- Deloitte Consulting - India
- Economic Council, Georgia
- Savvy Resources Ltd - HongKong
- Thiess Contractors Indonesia
- The Treasury - Australian Government
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- Indonesian Coal Mining Association
- Port Waratah Coal Services - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Agrawal Coal Company - India
- Alfred C Toepfer International GmbH - Germany
- Bukit Baiduri Energy - Indonesia
- PTC India Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- Indika Energy - Indonesia
- Kumho Petrochemical, South Korea
- Jaiprakash Power Ventures ltd
- Bulk Trading Sa - Switzerland
- The University of Queensland
- Bhatia International Limited - India
- India Bulls Power Limited - India
- Indian Energy Exchange, India
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- Star Paper Mills Limited - India
- Jindal Steel & Power Ltd - India
- Karaikal Port Pvt Ltd - India
- Energy Development Corp, Philippines
- Salva Resources Pvt Ltd - India
- Renaissance Capital - South Africa
- Simpson Spence & Young - Indonesia
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Kobexindo Tractors - Indoneisa
- Ministry of Mines - Canada
- IEA Clean Coal Centre - UK
- GVK Power & Infra Limited - India
- Central Java Power - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Tata Chemicals Ltd - India
- Thai Mozambique Logistica
- Malabar Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Singapore Mercantile Exchange
- Meenaskhi Energy Private Limited - India
- Merrill Lynch Commodities Europe
- Indo Tambangraya Megah - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Gujarat Mineral Development Corp Ltd - India
- Bangladesh Power Developement Board
- White Energy Company Limited
- Central Electricity Authority - India
- TeaM Sual Corporation - Philippines
- Minerals Council of Australia
- Vizag Seaport Private Limited - India
- Binh Thuan Hamico - Vietnam
- Bank of Tokyo Mitsubishi UFJ Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- VISA Power Limited - India
- Aditya Birla Group - India
- Trasteel International SA, Italy
- Pendopo Energi Batubara - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Therma Luzon, Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Coal and Oil Company - UAE
- Parry Sugars Refinery, India
- Parliament of New Zealand
- The State Trading Corporation of India Ltd
- Wood Mackenzie - Singapore
- Kartika Selabumi Mining - Indonesia
- Larsen & Toubro Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Commonwealth Bank - Australia
- Ceylon Electricity Board - Sri Lanka
- IHS Mccloskey Coal Group - USA
- South Luzon Thermal Energy Corporation
- ICICI Bank Limited - India
- LBH Netherlands Bv - Netherlands
- Iligan Light & Power Inc, Philippines
- Makarim & Taira - Indonesia
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- GAC Shipping (India) Pvt Ltd
- Globalindo Alam Lestari - Indonesia
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- Dalmia Cement Bharat India
- Sical Logistics Limited - India
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Australian Coal Association
- Coalindo Energy - Indonesia
- Siam City Cement PLC, Thailand
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- Carbofer General Trading SA - India
- San Jose City I Power Corp, Philippines
- Baramulti Group, Indonesia
- Planning Commission, India
- Vedanta Resources Plc - India
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Krishnapatnam Port Company Ltd. - India
- Mercuria Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Riau Bara Harum - Indonesia
- Kepco SPC Power Corporation, Philippines
- Cement Manufacturers Association - India
- Attock Cement Pakistan Limited
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Directorate Of Revenue Intelligence - India
- Latin American Coal - Colombia
- Ministry of Finance - Indonesia
- Energy Link Ltd, New Zealand
- Orica Australia Pty. Ltd.
- Bhushan Steel Limited - India
- Mjunction Services Limited - India
- Borneo Indobara - Indonesia
- Ministry of Transport, Egypt
- Chamber of Mines of South Africa
- Aboitiz Power Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- Medco Energi Mining Internasional
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Price Waterhouse Coopers - Russia
- TNB Fuel Sdn Bhd - Malaysia
- SMG Consultants - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Standard Chartered Bank - UAE
- Marubeni Corporation - India
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Global Business Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Posco Energy - South Korea
- Independent Power Producers Association of India
- Electricity Generating Authority of Thailand
- Meralco Power Generation, Philippines
- Electricity Authority, New Zealand
- Metalloyd Limited - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Holcim Trading Pte Ltd - Singapore
- Toyota Tsusho Corporation, Japan
- Sojitz Corporation - Japan
- ASAPP Information Group - India
- Global Coal Blending Company Limited - Australia
- Miang Besar Coal Terminal - Indonesia
- Tamil Nadu electricity Board
- Rashtriya Ispat Nigam Limited - India
- Formosa Plastics Group - Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Sindya Power Generating Company Private Ltd
- Videocon Industries ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Grasim Industreis Ltd - India
- Sakthi Sugars Limited - India
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Africa Commodities Group - South Africa
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Kideco Jaya Agung - Indonesia
- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- McConnell Dowell - Australia
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- Ind-Barath Power Infra Limited - India
- Semirara Mining Corp, Philippines
- PNOC Exploration Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Goldman Sachs - Singapore
- Straits Asia Resources Limited - Singapore
- Ambuja Cements Ltd - India
- Orica Mining Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Edison Trading Spa - Italy
- Coastal Gujarat Power Limited - India
- Altura Mining Limited, Indonesia
- Essar Steel Hazira Ltd - India
- SN Aboitiz Power Inc, Philippines
- Eastern Coal Council - USA
- Romanian Commodities Exchange
- Timah Investasi Mineral - Indoneisa
- Eastern Energy - Thailand
- Oldendorff Carriers - Singapore
- Leighton Contractors Pty Ltd - Australia
- Maheswari Brothers Coal Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Uttam Galva Steels Limited - India
- Heidelberg Cement - Germany
- GMR Energy Limited - India
- Power Finance Corporation Ltd., India
- MS Steel International - UAE
- Barasentosa Lestari - Indonesia
- Samtan Co., Ltd - South Korea
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