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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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Tuesday, 23 May 23
INDIA: COAL OUTPUT UP 8.9%, SUPPLY RISES 11.7% IN APRIL - FINANCIAL EXPRESS
India’s coal production jumped 8.85% to 73.14 million tonne (MT) in April 2023 and the total coal despatch during the month went up 11.66% to ...
Tuesday, 23 May 23
CHINA COAL OUTPUT UP 4.5 PCT IN APRIL - XINHUA
China’s raw coal output posted stable expansion in April, official data showed.
The country produced 380 million tonnes of raw ...
Saturday, 20 May 23
NON-OPEC OIL SUPPLY DEVELOPMENT - OPEC
In 2022, non-OPEC supply is estimated to have increased by 1.9 mb/d y-o-y. Out of this, US liquids production increased by 1.2 mb/d, mainly on the ...
Saturday, 20 May 23
GLOBAL COAL TRADE HAS REALLY PICKED UP PACE IN RECENT MONTHS, NOW FULLY BACK TO PRE-COVID LEVELS - BANCHERO COSTA
Global coal trade has really picked up pace in recent months, and is now fully back to pre-Covid levels. In Jan-Apr 2023, total global seaborne coa ...
Saturday, 20 May 23
MARKET INSIGHT - INTERMODAL
India is one of the world's largest coal producers and one of the world's largest importers of coal. The country uses coal mainly for power ...
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- Port Waratah Coal Services - Australia
- Singapore Mercantile Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sarangani Energy Corporation, Philippines
- Rio Tinto Coal - Australia
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Wilmar Investment Holdings
- Posco Energy - South Korea
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- Borneo Indobara - Indonesia
- South Luzon Thermal Energy Corporation
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- Electricity Generating Authority of Thailand
- Bhatia International Limited - India
- Simpson Spence & Young - Indonesia
- Australian Coal Association
- Vedanta Resources Plc - India
- Holcim Trading Pte Ltd - Singapore
- Kapuas Tunggal Persada - Indonesia
- Indian Energy Exchange, India
- Asmin Koalindo Tuhup - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Edison Trading Spa - Italy
- Petron Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
- Ministry of Mines - Canada
- Tamil Nadu electricity Board
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Manunggal Multi Energi - Indonesia
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kartika Selabumi Mining - Indonesia
- Baramulti Group, Indonesia
- Coalindo Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Lanco Infratech Ltd - India
- Billiton Holdings Pty Ltd - Australia
- ICICI Bank Limited - India
- Therma Luzon, Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Green Power PLC Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Miang Besar Coal Terminal - Indonesia
- Larsen & Toubro Limited - India
- Sakthi Sugars Limited - India
- Parliament of New Zealand
- SMC Global Power, Philippines
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- IEA Clean Coal Centre - UK
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Barasentosa Lestari - Indonesia
- Carbofer General Trading SA - India
- Global Coal Blending Company Limited - Australia
- Siam City Cement PLC, Thailand
- Electricity Authority, New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- Australian Commodity Traders Exchange
- Salva Resources Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Malabar Cements Ltd - India
- Mintek Dendrill Indonesia
- Kumho Petrochemical, South Korea
- Sindya Power Generating Company Private Ltd
- Indian Oil Corporation Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Georgia Ports Authority, United States
- Attock Cement Pakistan Limited
- Parry Sugars Refinery, India
- London Commodity Brokers - England
- Bukit Asam (Persero) Tbk - Indonesia
- Commonwealth Bank - Australia
- Pendopo Energi Batubara - Indonesia
- SN Aboitiz Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Mercuria Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- PTC India Limited - India
- Maharashtra Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Independent Power Producers Association of India
- Indonesian Coal Mining Association
- Globalindo Alam Lestari - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Oldendorff Carriers - Singapore
- Trasteel International SA, Italy
- European Bulk Services B.V. - Netherlands
- Chettinad Cement Corporation Ltd - India
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- Kobexindo Tractors - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Merrill Lynch Commodities Europe
- Gujarat Sidhee Cement - India
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Goldman Sachs - Singapore
- The Treasury - Australian Government
- Kalimantan Lumbung Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- Bukit Baiduri Energy - Indonesia
- Latin American Coal - Colombia
- Jindal Steel & Power Ltd - India
- Dalmia Cement Bharat India
- Banpu Public Company Limited - Thailand
- Kepco SPC Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Sical Logistics Limited - India
- Uttam Galva Steels Limited - India
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- Neyveli Lignite Corporation Ltd, - India
- Bulk Trading Sa - Switzerland
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- Bhushan Steel Limited - India
- Krishnapatnam Port Company Ltd. - India
- GVK Power & Infra Limited - India
- VISA Power Limited - India
- Ministry of Finance - Indonesia
- Coastal Gujarat Power Limited - India
- GMR Energy Limited - India
- LBH Netherlands Bv - Netherlands
- CNBM International Corporation - China
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Agrawal Coal Company - India
- Energy Development Corp, Philippines
- Tata Chemicals Ltd - India
- Kideco Jaya Agung - Indonesia
- SMG Consultants - Indonesia
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Intertek Mineral Services - Indonesia
- Ambuja Cements Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Metalloyd Limited - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Karaikal Port Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- The State Trading Corporation of India Ltd
- Economic Council, Georgia
- OPG Power Generation Pvt Ltd - India
- Videocon Industries ltd - India
- Eastern Coal Council - USA
- White Energy Company Limited
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- Semirara Mining Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Planning Commission, India
- Formosa Plastics Group - Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Kohat Cement Company Ltd. - Pakistan
- International Coal Ventures Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- India Bulls Power Limited - India
- Vizag Seaport Private Limited - India
- Wood Mackenzie - Singapore
- Toyota Tsusho Corporation, Japan
- Heidelberg Cement - Germany
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- Indo Tambangraya Megah - Indonesia
- Maheswari Brothers Coal Limited - India
- Grasim Industreis Ltd - India
- Aditya Birla Group - India
- Energy Link Ltd, New Zealand
- The University of Queensland
- Ceylon Electricity Board - Sri Lanka
- Eastern Energy - Thailand
- Meralco Power Generation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bangladesh Power Developement Board
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Cement Manufacturers Association - India
- Indogreen Group - Indonesia
- ASAPP Information Group - India
- Kaltim Prima Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Altura Mining Limited, Indonesia
- Madhucon Powers Ltd - India
- Central Java Power - Indonesia
- Deloitte Consulting - India
- Vijayanagar Sugar Pvt Ltd - India
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