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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, 17 January 23
CHINA'S SHANXI TARGETS 2023 COAL PRODUCTION OF NEARLY 1.37B TONS - XINHUA
China’s coal-rich province of Shanxi has set a coal production target of nearly 1.37 billion metric tons for 2023, according to a government ...
Tuesday, 17 January 23
MARKET INSIGHT - INTERMODAL
Rumor has it that the New Year has come, to set the pace in, for Russia to continue hostilities against Ukraine. Ten months on the go, into Russia& ...
Tuesday, 17 January 23
INDONESIA IS ACCOUNTING FOR 32.3% OF THE GLOBAL SEABORNE COAL MARKET IN 2022 - BENCHERO 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, Benchero ...
Tuesday, 10 January 23
INDONESIAN HBA IS SEEING A SPIKE IN JANUARY 2023 INSTEAD OF A SIGNIFICANT FALL IN DECEMBER 2022
COALspot.com: Indonesian Coal Price Reference up 8.43% in January 2023.
HBA is seeing a dramatic spike in January 2023 i ...
Sunday, 08 January 23
INDIAN COAL POWER PLANTS SHOULD BE COMPENSATED FOR 2022 FORCED GENERATION – REGULATOR : REUTERS
Indian power plants that rely on imported coal should be fully compensated when forced to supply electricity, the country’s power regulator s ...
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- Energy Development Corp, Philippines
- Eastern Coal Council - USA
- Altura Mining Limited, Indonesia
- Bangladesh Power Developement Board
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Central Electricity Authority - India
- Maharashtra Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- The University of Queensland
- Bharathi Cement Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Commonwealth Bank - Australia
- Deloitte Consulting - India
- LBH Netherlands Bv - Netherlands
- Indika Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Ministry of Transport, Egypt
- Global Coal Blending Company Limited - Australia
- Attock Cement Pakistan Limited
- TeaM Sual Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Kepco SPC Power Corporation, Philippines
- VISA Power Limited - India
- Australian Commodity Traders Exchange
- Bukit Makmur.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- Medco Energi Mining Internasional
- Malabar Cements Ltd - India
- Dalmia Cement Bharat India
- Gujarat Mineral Development Corp Ltd - India
- Bhatia International Limited - India
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- Wood Mackenzie - Singapore
- Directorate Of Revenue Intelligence - India
- New Zealand Coal & Carbon
- International Coal Ventures Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Chettinad Cement Corporation Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Trasteel International SA, Italy
- Anglo American - United Kingdom
- Posco Energy - South Korea
- Rashtriya Ispat Nigam Limited - India
- Videocon Industries ltd - India
- Iligan Light & Power Inc, Philippines
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Toyota Tsusho Corporation, Japan
- Meralco Power Generation, Philippines
- Lanco Infratech Ltd - India
- Grasim Industreis Ltd - India
- Samtan Co., Ltd - South Korea
- Antam Resourcindo - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Karaikal Port Pvt Ltd - India
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- Independent Power Producers Association of India
- Pendopo Energi Batubara - Indonesia
- Singapore Mercantile Exchange
- SMG Consultants - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Global Business Power Corporation, Philippines
- Romanian Commodities Exchange
- Vedanta Resources Plc - India
- Holcim Trading Pte Ltd - Singapore
- Sical Logistics Limited - India
- The State Trading Corporation of India Ltd
- CIMB Investment Bank - Malaysia
- Billiton Holdings Pty Ltd - Australia
- Africa Commodities Group - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Global Green Power PLC Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- SMC Global Power, Philippines
- Renaissance Capital - South Africa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indian Oil Corporation Limited
- Latin American Coal - Colombia
- GMR Energy Limited - India
- Cigading International Bulk Terminal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Indonesian Coal Mining Association
- Offshore Bulk Terminal Pte Ltd, Singapore
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Heidelberg Cement - Germany
- Leighton Contractors Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- McConnell Dowell - Australia
- Timah Investasi Mineral - Indoneisa
- Mjunction Services Limited - India
- European Bulk Services B.V. - Netherlands
- Jaiprakash Power Ventures ltd
- Tamil Nadu electricity Board
- Mintek Dendrill Indonesia
- Star Paper Mills Limited - India
- Sree Jayajothi Cements Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- GVK Power & Infra Limited - India
- The Treasury - Australian Government
- Thiess Contractors Indonesia
- Siam City Cement PLC, Thailand
- Electricity Generating Authority of Thailand
- Coalindo Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Wilmar Investment Holdings
- Barasentosa Lestari - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sojitz Corporation - Japan
- Intertek Mineral Services - Indonesia
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Kumho Petrochemical, South Korea
- ASAPP Information Group - India
- Riau Bara Harum - Indonesia
- Mercator Lines Limited - India
- Marubeni Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- White Energy Company Limited
- Aditya Birla Group - India
- Ambuja Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- Parry Sugars Refinery, India
- Edison Trading Spa - Italy
- Minerals Council of Australia
- Australian Coal Association
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- Globalindo Alam Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- Borneo Indobara - Indonesia
- Cement Manufacturers Association - India
- Siam City Cement - Thailand
- Ind-Barath Power Infra Limited - India
- Kartika Selabumi Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
- Savvy Resources Ltd - HongKong
- Petron Corporation, Philippines
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Straits Asia Resources Limited - Singapore
- Indogreen Group - Indonesia
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Energy Link Ltd, New Zealand
- Orica Mining Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sakthi Sugars Limited - India
- PTC India Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- ICICI Bank Limited - India
- Oldendorff Carriers - Singapore
- Sindya Power Generating Company Private Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tata Chemicals Ltd - India
- Formosa Plastics Group - Taiwan
- Ceylon Electricity Board - Sri Lanka
- PowerSource Philippines DevCo
- Standard Chartered Bank - UAE
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- IHS Mccloskey Coal Group - USA
- San Jose City I Power Corp, Philippines
- Rio Tinto Coal - Australia
- OPG Power Generation Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- London Commodity Brokers - England
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- Gujarat Sidhee Cement - India
- Jindal Steel & Power Ltd - India
- Essar Steel Hazira Ltd - India
- Metalloyd Limited - United Kingdom
- Meenaskhi Energy Private Limited - India
- Xindia Steels Limited - India
- Bulk Trading Sa - Switzerland
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Agrawal Coal Company - India
- Maheswari Brothers Coal Limited - India
- CNBM International Corporation - China
- Port Waratah Coal Services - Australia
- Larsen & Toubro Limited - India
- Kapuas Tunggal Persada - Indonesia
- Manunggal Multi Energi - Indonesia
- Chamber of Mines of South Africa
- Interocean Group of Companies - India
- Coal and Oil Company - UAE
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