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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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Wednesday, 07 October 20
U.S. COAL PRODUCTION TO DECREASE BY 26 PERCENT IN 2020 COMPARED TO 2019 - EIA
EIA expects total U.S. coal production in 2020 to be 525 million short tons (MMst), compared with 705 MMst in 2019, a 26% decrease.
COVID-19 a ...
Wednesday, 07 October 20
MARKET INSIGHT - INTERMODAL
The challenges brought forward in 2020 proved to be very different from what we could have ever imagined. Together with placing a significant strai ...
Tuesday, 06 October 20
KOSPO TO IMPORT 80,000 MT OF 3,800 NCV COAL FOR 2H NOV
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 80,000 MT Min.3800 kcal/kg NCV coal 2H November, 2020 l ...
Friday, 02 October 20
THE INDONESIA COAL PRICE REFERENCE RISE AFTER HISTORIC CRASH TO US$ 49.42
COALspot.com: The Indonesia Coal Price Reference for the month of October Rise to US$ 51.00 after historic crash to US$ 49.42 in September 2020.
...
Friday, 02 October 20
SRI LANKA MUST LEARN LESSONS FROM AROUND ASIA TO AVOID FURTHER ELECTRICITY CRISES - IEEFA
Overcommitment to fossil-fuelled power generation is leading to excess capacity and rising capacity payments, subsidies, and tariffs around the con ...
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- Semirara Mining and Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Trasteel International SA, Italy
- Carbofer General Trading SA - India
- Central Electricity Authority - India
- Energy Link Ltd, New Zealand
- Jindal Steel & Power Ltd - India
- OPG Power Generation Pvt Ltd - India
- Central Java Power - Indonesia
- SMG Consultants - Indonesia
- Indogreen Group - Indonesia
- Salva Resources Pvt Ltd - India
- India Bulls Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Orica Mining Services - Indonesia
- Karaikal Port Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Directorate Of Revenue Intelligence - India
- Agrawal Coal Company - India
- Indian Energy Exchange, India
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Pendopo Energi Batubara - Indonesia
- McConnell Dowell - Australia
- Larsen & Toubro Limited - India
- Africa Commodities Group - South Africa
- Ambuja Cements Ltd - India
- Intertek Mineral Services - Indonesia
- Gujarat Sidhee Cement - India
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- Coastal Gujarat Power Limited - India
- Formosa Plastics Group - Taiwan
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Mercator Lines Limited - India
- Ind-Barath Power Infra Limited - India
- Energy Development Corp, Philippines
- GVK Power & Infra Limited - India
- Aditya Birla Group - India
- Edison Trading Spa - Italy
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- London Commodity Brokers - England
- Globalindo Alam Lestari - Indonesia
- European Bulk Services B.V. - Netherlands
- Vedanta Resources Plc - India
- Global Green Power PLC Corporation, Philippines
- Singapore Mercantile Exchange
- Xindia Steels Limited - India
- Videocon Industries ltd - India
- Tata Chemicals Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- White Energy Company Limited
- IHS Mccloskey Coal Group - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Grasim Industreis Ltd - India
- Makarim & Taira - Indonesia
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Power Finance Corporation Ltd., India
- CIMB Investment Bank - Malaysia
- Price Waterhouse Coopers - Russia
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- Jorong Barutama Greston.PT - Indonesia
- New Zealand Coal & Carbon
- Goldman Sachs - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Aboitiz Power Corporation - Philippines
- Parry Sugars Refinery, India
- Bharathi Cement Corporation - India
- Marubeni Corporation - India
- Timah Investasi Mineral - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Attock Cement Pakistan Limited
- South Luzon Thermal Energy Corporation
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Merrill Lynch Commodities Europe
- Deloitte Consulting - India
- Rio Tinto Coal - Australia
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Jaiprakash Power Ventures ltd
- Manunggal Multi Energi - Indonesia
- Economic Council, Georgia
- Therma Luzon, Inc, Philippines
- Interocean Group of Companies - India
- Parliament of New Zealand
- Savvy Resources Ltd - HongKong
- Electricity Authority, New Zealand
- Sical Logistics Limited - India
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Siam City Cement PLC, Thailand
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- The Treasury - Australian Government
- Eastern Energy - Thailand
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- Barasentosa Lestari - Indonesia
- Star Paper Mills Limited - India
- Metalloyd Limited - United Kingdom
- CNBM International Corporation - China
- Renaissance Capital - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- ICICI Bank Limited - India
- Posco Energy - South Korea
- PNOC Exploration Corporation - Philippines
- Australian Coal Association
- Altura Mining Limited, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- San Jose City I Power Corp, Philippines
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Port Waratah Coal Services - Australia
- SMC Global Power, Philippines
- Bhushan Steel Limited - India
- Rashtriya Ispat Nigam Limited - India
- Uttam Galva Steels Limited - India
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Thiess Contractors Indonesia
- Romanian Commodities Exchange
- Kartika Selabumi Mining - Indonesia
- Indika Energy - Indonesia
- Chamber of Mines of South Africa
- IEA Clean Coal Centre - UK
- TeaM Sual Corporation - Philippines
- Heidelberg Cement - Germany
- Commonwealth Bank - Australia
- Georgia Ports Authority, United States
- Medco Energi Mining Internasional
- Bhoruka Overseas - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Indo Tambangraya Megah - Indonesia
- Cigading International Bulk Terminal - Indonesia
- PTC India Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- GMR Energy Limited - India
- Coal and Oil Company - UAE
- Sinarmas Energy and Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kaltim Prima Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Alfred C Toepfer International GmbH - Germany
- Minerals Council of Australia
- Sindya Power Generating Company Private Ltd
- Wood Mackenzie - Singapore
- Siam City Cement - Thailand
- Orica Australia Pty. Ltd.
- Antam Resourcindo - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Mercuria Energy - Indonesia
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- Oldendorff Carriers - Singapore
- Borneo Indobara - Indonesia
- Petron Corporation, Philippines
- The University of Queensland
- Iligan Light & Power Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Ministry of Transport, Egypt
- PetroVietnam Power Coal Import and Supply Company
- Meenaskhi Energy Private Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Finance - Indonesia
- Standard Chartered Bank - UAE
- Banpu Public Company Limited - Thailand
- Kapuas Tunggal Persada - Indonesia
- Simpson Spence & Young - Indonesia
- Sarangani Energy Corporation, Philippines
- Planning Commission, India
- Cement Manufacturers Association - India
- TNB Fuel Sdn Bhd - Malaysia
- Sree Jayajothi Cements Limited - India
- Tamil Nadu electricity Board
- The State Trading Corporation of India Ltd
- Maharashtra Electricity Regulatory Commission - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Lanco Infratech Ltd - India
- Bukit Baiduri Energy - Indonesia
- Indonesian Coal Mining Association
- Electricity Generating Authority of Thailand
- Bayan Resources Tbk. - Indonesia
- Global Coal Blending Company Limited - Australia
- Kalimantan Lumbung Energi - Indonesia
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Straits Asia Resources Limited - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sakthi Sugars Limited - India
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