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Friday, 10 July 20
SLOW RECOVERY IN TANKER RATES TO WEIGH ON BUANA LINTAS LAUTAN - FITCH RATINGS
 Fitch Ratings believes that international tanker rates are likely improve after their sharp fall since May 2020, albeit at a slow pace. The weakness in rates may weigh on the financial profile of PT Buana Lintas Lautan Tbk (BULL, B+/Negative), which has around 15% of its fleet capacity earning revenue based on international spot rates.
The Baltic Dirty Tanker Index, which is made up from 12 Baltic international routes and mainly for crude oil shipping, has declined to below 500 points, from an average of 1,200 in March-April 2020, and is at its lowest since 2009. The index averaged 855 points in 2019 and around 770 points since 2009. Similarly, the Baltic Clean Tanker Index for refined fuel shipping has fallen to below 400 points from an average of around 1,305 points in April 2020.
The sharp fall in rates follows lower demand for global oil transportation with the OPEC+ alliance announcing in April 2020 an agreement to cut output by 9.7 million barrels per day (mbpd), or 10% of global output, from May 1. The group agreed in June to extend the production cut by one month through the end of July. The cut in output also resulted in a sharp rally in crude oil prices, with Brent price increasing to over USD40 per barrel (bbl) from around USD20/bbl near mid-April. Higher oil prices reduced the demand for floating storage and such tankers were freed, increasing spare capacity and pressuring rates.
Tanker demand has declined sharply since March-April, when Saudi Arabia increased its oil output ahead of the OPEC+ deal to cut production. The effect of increased oil output on tanker rates was compounded by the sharp fall in oil prices, which caused the futures curve to be in contango and incentivised oil storage on land and in tankers.
Demand for tankers is likely to improve from August with a reduction in the OPEC+ cuts to 7.7mbpd until the end of the 2020 and further to 5.8mbpd from January 2021. However, the output cut will continue weighing on tanker rates and improvement in rates is likely to be a gradual process.
Indonesian tanker operators PT Soechi Lines Tbk (B/Stable) and BULL benefit from largely stable rates in the domestic market, which is protected from foreign competition by cabotage laws and dominated by state-owned oil major PT Pertamina (Persero) (BBB/Stable) which is the main revenue driver.
However, BULL’s exposure to international rate volatility has increased this year. BULL had 24 of its 25 ships, or 93% of its fleet capacity, under standard time-charter contracts as of end-2019 while one tanker was part of a pool of ships managed by a pool operator and earned revenue based on international spot rates. The share of BULL’s fleet capacity managed by the pool operator has increased to 14% by end-2Q20 with three out of 33 ships being part of the pool. Additionally, BULL has two ships constituting 10% of its capacity under time-charter contracts with a base rate and upside if international spot rates are higher.
The company said it is seeking to switch the fleet under the pool operator to short-term time charter contracts of three to six months from September 2020 to limit the impact of the fall in tanker rates. Nonetheless, the Negative Outlook on BULL’s rating reflects risks to its financial profile from weak international rates, apart from sustained spending on fleet expansion. We estimate FFO gross leverage to increase to 3.8x in 2021, from 2.9x in 2020 (2019: 4.3x), due to lower international rates and EBITDA. We also assume BULL acquires five more ships for USD100 million in 2021.
Source: Fitch Ratings
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Friday, 05 January 24
BANGLADESH’S 2023 COAL-FIRED POWER OUTPUT TRIPLED, EASING SHORTAGES - REUTERS
Bangladesh nearly tripled its coal-fired power output in 2023, a Reuters analysis of government data showed, helping it tide over the worst power s ...
Tuesday, 02 January 24
COAL TRADE CONTINUES TO HEAD EAST - BALTIC EXCHANGE
The global coal trade, once concentrated in the Pacific and Atlantic basins, is undergoing a significant transformation, as highlighted in the Inte ...
Tuesday, 02 January 24
COAL CARGOES: AVOIDING EXPLOSION AND SELF-HEATING - GARD
KNOWLEDGE TO ELEVATE
Despite its contribution to greenhouse gas emissions, global coal consumption climbed to an all-time high in 2022 and is ...
Tuesday, 02 January 24
SINOPEC FORECASTS CHINA’S COAL CONSUMPTION TO PEAK AROUND 2025 - REUTERS
China Petrochemical Corp, or Sinopec, expects coal consumption to peak around 2025 at 4.37 billion metric tons, the state energy group said in an o ...
Thursday, 07 December 23
CHINA TO SET UP COAL PRODUCTION RESERVE TO STABILISE PRICES - REUTERS
China will establish a back-up coal production system by 2027 to stabilise prices and secure coal supply, the state planner said on Wednesday, even ...
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- Orica Australia Pty. Ltd.
- Chamber of Mines of South Africa
- Riau Bara Harum - Indonesia
- Bangladesh Power Developement Board
- Banpu Public Company Limited - Thailand
- Indo Tambangraya Megah - Indonesia
- Vizag Seaport Private Limited - India
- Trasteel International SA, Italy
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- Interocean Group of Companies - India
- The Treasury - Australian Government
- The University of Queensland
- Indika Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Parliament of New Zealand
- Planning Commission, India
- Petron Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Antam Resourcindo - Indonesia
- Metalloyd Limited - United Kingdom
- Salva Resources Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Eastern Coal Council - USA
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- ICICI Bank Limited - India
- Madhucon Powers Ltd - India
- Karaikal Port Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Iligan Light & Power Inc, Philippines
- Mercator Lines Limited - India
- Central Electricity Authority - India
- Renaissance Capital - South Africa
- ASAPP Information Group - India
- Medco Energi Mining Internasional
- Makarim & Taira - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Leighton Contractors Pty Ltd - Australia
- Power Finance Corporation Ltd., India
- Siam City Cement PLC, Thailand
- Neyveli Lignite Corporation Ltd, - India
- Tamil Nadu electricity Board
- Karbindo Abesyapradhi - Indoneisa
- Oldendorff Carriers - Singapore
- Meralco Power Generation, Philippines
- Energy Link Ltd, New Zealand
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- TNB Fuel Sdn Bhd - Malaysia
- Electricity Authority, New Zealand
- Bhushan Steel Limited - India
- Mercuria Energy - Indonesia
- Independent Power Producers Association of India
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Mjunction Services Limited - India
- Kepco SPC Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Heidelberg Cement - Germany
- Sree Jayajothi Cements Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Coastal Gujarat Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- SMC Global Power, Philippines
- Sojitz Corporation - Japan
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- Chettinad Cement Corporation Ltd - India
- Ministry of Transport, Egypt
- Ind-Barath Power Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Timah Investasi Mineral - Indoneisa
- GAC Shipping (India) Pvt Ltd
- Directorate General of MIneral and Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Anglo American - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- India Bulls Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Commonwealth Bank - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Orica Mining Services - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Marubeni Corporation - India
- Economic Council, Georgia
- Kalimantan Lumbung Energi - Indonesia
- Singapore Mercantile Exchange
- Kobexindo Tractors - Indoneisa
- Dalmia Cement Bharat India
- Vedanta Resources Plc - India
- Africa Commodities Group - South Africa
- Billiton Holdings Pty Ltd - Australia
- Energy Development Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- Lanco Infratech Ltd - India
- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Sakthi Sugars Limited - India
- Bulk Trading Sa - Switzerland
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- Asmin Koalindo Tuhup - Indonesia
- Aboitiz Power Corporation - Philippines
- Global Business Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Bukit Baiduri Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Coal and Oil Company - UAE
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Global Green Power PLC Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Eastern Energy - Thailand
- Wilmar Investment Holdings
- London Commodity Brokers - England
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Kumho Petrochemical, South Korea
- Rio Tinto Coal - Australia
- MS Steel International - UAE
- Maheswari Brothers Coal Limited - India
- Goldman Sachs - Singapore
- Xindia Steels Limited - India
- Australian Commodity Traders Exchange
- Cigading International Bulk Terminal - Indonesia
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- Straits Asia Resources Limited - Singapore
- TeaM Sual Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Larsen & Toubro Limited - India
- Bukit Makmur.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Price Waterhouse Coopers - Russia
- Minerals Council of Australia
- Gujarat Sidhee Cement - India
- OPG Power Generation Pvt Ltd - India
- Bhatia International Limited - India
- Rashtriya Ispat Nigam Limited - India
- Essar Steel Hazira Ltd - India
- Mintek Dendrill Indonesia
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Central Java Power - Indonesia
- Kaltim Prima Coal - Indonesia
- IHS Mccloskey Coal Group - USA
- Ministry of Finance - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Meenaskhi Energy Private Limited - India
- Star Paper Mills Limited - India
- Semirara Mining Corp, Philippines
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Malabar Cements Ltd - India
- Edison Trading Spa - Italy
- IEA Clean Coal Centre - UK
- Merrill Lynch Commodities Europe
- Videocon Industries ltd - India
- McConnell Dowell - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GVK Power & Infra Limited - India
- Thiess Contractors Indonesia
- SN Aboitiz Power Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Australian Coal Association
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Ministry of Mines - Canada
- Holcim Trading Pte Ltd - Singapore
- Posco Energy - South Korea
- VISA Power Limited - India
- Global Coal Blending Company Limited - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Tata Chemicals Ltd - India
- Barasentosa Lestari - Indonesia
- Agrawal Coal Company - India
- Sindya Power Generating Company Private Ltd
- European Bulk Services B.V. - Netherlands
- Carbofer General Trading SA - India
- Gujarat Mineral Development Corp Ltd - India
- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- Indian Energy Exchange, India
- Savvy Resources Ltd - HongKong
- Grasim Industreis Ltd - India
- The State Trading Corporation of India Ltd
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