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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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Saturday, 25 March 23
COAL INDIA HAS STRONG CASE TO INCREASE PRICES, TALKS ON: CMD AGRAWAL - BUSINESS STANDARD
Coal India (CIL) Chairman and Managing Director Pramod Agrawal said on Monday there is a “strong case” for increasing coal prices, and ...
Saturday, 25 March 23
ASIAN CRUDE PALM OIL WATCH 1Q23 - FITCH RATINGS
Malaysian benchmark crude palm oil (CPO) spot prices have averaged around USD915 per tonne (t) so far in 1Q23, sharply lower than the average of ar ...
Saturday, 25 March 23
INDONESIA’S COAL EXPORT INCREASED BY 21.0% YOY TO 388.4 MLN T IN 2022 - BANCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels. In the f ...
Saturday, 25 March 23
GLOBAL LNG-ASIA SPOT PRICES SLIP AS WEAK NORTHERN DEMAND REMAINS - REUTERS
Asian spot prices of liquefied natural gas (LNG) declined this week, falling to a 21-month low, as weak demand in the northeast Asia region continu ...
Wednesday, 22 March 23
OIL PRICE FALL SPECULATIVE, TO HIT $140 BY YEAR-END -ANDURAND: REUTERS
The recent fall in oil prices due to banking jitters is speculative and oil will hit $140 a barrel by the end of the year, hedge fund manager Pierr ...
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- Minerals Council of Australia
- The State Trading Corporation of India Ltd
- Sojitz Corporation - Japan
- Orica Mining Services - Indonesia
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- Trasteel International SA, Italy
- European Bulk Services B.V. - Netherlands
- The University of Queensland
- SMC Global Power, Philippines
- Krishnapatnam Port Company Ltd. - India
- Price Waterhouse Coopers - Russia
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Globalindo Alam Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Merrill Lynch Commodities Europe
- Goldman Sachs - Singapore
- McConnell Dowell - Australia
- Deloitte Consulting - India
- Indian Energy Exchange, India
- LBH Netherlands Bv - Netherlands
- Vizag Seaport Private Limited - India
- GVK Power & Infra Limited - India
- Economic Council, Georgia
- Wilmar Investment Holdings
- Electricity Authority, New Zealand
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Sakthi Sugars Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Global Business Power Corporation, Philippines
- ASAPP Information Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Mintek Dendrill Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Asam (Persero) Tbk - Indonesia
- Parliament of New Zealand
- Samtan Co., Ltd - South Korea
- Wood Mackenzie - Singapore
- Australian Coal Association
- Indika Energy - Indonesia
- Mjunction Services Limited - India
- ICICI Bank Limited - India
- OPG Power Generation Pvt Ltd - India
- Medco Energi Mining Internasional
- Electricity Generating Authority of Thailand
- Central Electricity Authority - India
- London Commodity Brokers - England
- Kapuas Tunggal Persada - Indonesia
- Pendopo Energi Batubara - Indonesia
- TeaM Sual Corporation - Philippines
- Anglo American - United Kingdom
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- Bhoruka Overseas - Indonesia
- Manunggal Multi Energi - Indonesia
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- PowerSource Philippines DevCo
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Global Coal Blending Company Limited - Australia
- GN Power Mariveles Coal Plant, Philippines
- Uttam Galva Steels Limited - India
- Latin American Coal - Colombia
- PTC India Limited - India
- Cement Manufacturers Association - India
- Central Java Power - Indonesia
- Meenaskhi Energy Private Limited - India
- Chamber of Mines of South Africa
- Aditya Birla Group - India
- Australian Commodity Traders Exchange
- Essar Steel Hazira Ltd - India
- Timah Investasi Mineral - Indoneisa
- Oldendorff Carriers - Singapore
- Dalmia Cement Bharat India
- Sree Jayajothi Cements Limited - India
- Interocean Group of Companies - India
- Jindal Steel & Power Ltd - India
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- Bhushan Steel Limited - India
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Mercator Lines Limited - India
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- Videocon Industries ltd - India
- Straits Asia Resources Limited - Singapore
- Bukit Baiduri Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Independent Power Producers Association of India
- Altura Mining Limited, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Mercuria Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- VISA Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Metalloyd Limited - United Kingdom
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Posco Energy - South Korea
- Directorate Of Revenue Intelligence - India
- White Energy Company Limited
- Commonwealth Bank - Australia
- Global Green Power PLC Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Asmin Koalindo Tuhup - Indonesia
- Xindia Steels Limited - India
- SMG Consultants - Indonesia
- Bharathi Cement Corporation - India
- Sindya Power Generating Company Private Ltd
- Bhatia International Limited - India
- Madhucon Powers Ltd - India
- Simpson Spence & Young - Indonesia
- Tata Chemicals Ltd - India
- SN Aboitiz Power Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Singapore Mercantile Exchange
- Energy Development Corp, Philippines
- Ambuja Cements Ltd - India
- Meralco Power Generation, Philippines
- Bulk Trading Sa - Switzerland
- Rio Tinto Coal - Australia
- Bahari Cakrawala Sebuku - Indonesia
- New Zealand Coal & Carbon
- Ind-Barath Power Infra Limited - India
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- San Jose City I Power Corp, Philippines
- CNBM International Corporation - China
- Heidelberg Cement - Germany
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Kideco Jaya Agung - Indonesia
- Maheswari Brothers Coal Limited - India
- Iligan Light & Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Agrawal Coal Company - India
- Kohat Cement Company Ltd. - Pakistan
- Kaltim Prima Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Binh Thuan Hamico - Vietnam
- Ministry of Transport, Egypt
- Bangladesh Power Developement Board
- Ministry of Finance - Indonesia
- Power Finance Corporation Ltd., India
- Indogreen Group - Indonesia
- Barasentosa Lestari - Indonesia
- Indonesian Coal Mining Association
- International Coal Ventures Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Parry Sugars Refinery, India
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Riau Bara Harum - Indonesia
- Thai Mozambique Logistica
- Semirara Mining and Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Billiton Holdings Pty Ltd - Australia
- Indo Tambangraya Megah - Indonesia
- Semirara Mining Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karaikal Port Pvt Ltd - India
- Indian Oil Corporation Limited
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- Coastal Gujarat Power Limited - India
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Baramulti Group, Indonesia
- Borneo Indobara - Indonesia
- South Luzon Thermal Energy Corporation
- Ceylon Electricity Board - Sri Lanka
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement PLC, Thailand
- Miang Besar Coal Terminal - Indonesia
- Edison Trading Spa - Italy
- Vijayanagar Sugar Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Star Paper Mills Limited - India
- Intertek Mineral Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Gujarat Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cigading International Bulk Terminal - Indonesia
- Marubeni Corporation - India
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- Port Waratah Coal Services - Australia
- Savvy Resources Ltd - HongKong
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- Eastern Coal Council - USA
- Jorong Barutama Greston.PT - Indonesia
- Attock Cement Pakistan Limited
- Makarim & Taira - Indonesia
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