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Thursday, 12 August 21
ONLY 3 VLCCS SOLD FOR DEMOLITION IN 2021 AS SECONDHAND PRICES TEMPT - BIMCO
 During the first seven months of 2021, only three actively trading Very Large Crude Carriers (VLCCs) have been sold for demolition. The current market for seaborne transportation of crude oil is weak and has caused freight rates to drop to multi-year lows. Despite this, crude oil tanker shipowners are not seizing the opportunity to reduce capacity and send less efficient units to the demolition yards.
The subdued demolition activity is seen at a time when steel prices offered in Bangladesh, India, and Pakistan – the world’s top ship demolition locations – are at an all-time high. The price of steel from ship demolition is supported by high steel prices in general as well as the limited number of ships heading for demolition.
In addition to the three actively trading VLCCs demolished in the first seven months of the year, five retired VLCCs working as Floating Storage and Offloading units (FSOs) in recent years have been demolished.
However, as they are not actively trading, the demolition of these five VLCC (FSO)s does not affect the demand-supply imbalance, i.e., the freight rates. The average age of the scrapped VLCCs used as FSOs is 24 years while the average age for the three actively trading VLCCs is 22 years.
Owners take advantage of an attractive secondhand market
The lethargic pace of VLCC demolition is also explained by attractive prices for older ships in the secondhand market. According to VesselsValue, 69 VLCCs have changed hands in the Jan-July 2021 period, compared with 91 for the full year of 2020.
To some extent, what we see now is like what we saw in the period that followed the six quarters of high oil tanker earnings from Q4 2014 through Q1 2016. Following this it was not until Q3 2017 that we began to see a pick-up in demolition for VLCCs.
Time has proven that it takes time for shipowners’ demolition decision to mature, and that a weak market right in the wake of a strong one is not enough to take the final step and go for demolition.
“The low demolition level seen in the first seven months of the year for crude oil tankers surely takes some by surprise. Some are wondering why shipowners are not demolishing the excess fleet when freight rates have been sluggish for the past year,” says Peter Sand, BIMCO’s Chief Shipping Analyst.
“The reason behind this is two-fold. Firstly, the strong earnings enjoyed by everyone in the crude oil tanker shipping sector last year leaves no owner short of cash. Secondly, as secondhand prices exceed even the record-high prices offered for demolition steel, shipowners are more inclined to keep their tankers afloat and changing hands, rather than sending them to the demolition yards,” says Sand, adding:
“Yet, nothing is straightforward as oil product tankers, on the other hand are heading for a record-high level of fleet demolition in 2021.”
Source: BIMCO, By Peter Sand, Chief Shipping Analyst
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Wednesday, 13 October 21
MARKET INSIGHT - INTERMODAL
Following up on our insight on May 2021, where we discussed about the Capesize market outlook for the second half of the year, we are pleased to se ...
Wednesday, 13 October 21
FBX INDEX: THE IMPOSSIBILITY OF SHORT-TERM FORECASTING - LARS JENSEN
Will freight rates on Asia-Europe or the Transpacific reach 40.000 USD/FFE in the run-up prior to Chinese New Year 2022? Or will they start droppin ...
Wednesday, 13 October 21
CHINA FLOODS: COAL PRICE HITS FRESH HIGH AS MINES SHUT - BBC
The price of coal used in China’s power plants has surged to a new record high as another of the country’s key mining regions is hit by ...
Tuesday, 12 October 21
BUMA SIGNS CONDITIONAL AGREEMENT FOR AUSTRALIAN ASSET ACQUISITION
PT Tbk. announced that its subsidiary, PT Bukit Makmur Mandiri Utama, through its newly incorporated Australian subsidiary, BUMA International Pty ...
Tuesday, 12 October 21
INDONESIA'S COAL-BASED POWER PLANTS ARE SUBJECT TO CARBON TAX NEXT YEAR, ELECTRICITY COSTS COULD RISE! - CNBC
The Indonesian government is planning plans to implement a carbon tax of IDR 30 per kilogram (kg) of carbon dioxide equivalent (CO2e) or equivalent ...
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- IHS Mccloskey Coal Group - USA
- IEA Clean Coal Centre - UK
- Chamber of Mines of South Africa
- Global Coal Blending Company Limited - Australia
- Star Paper Mills Limited - India
- Global Green Power PLC Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
- Sojitz Corporation - Japan
- GMR Energy Limited - India
- Antam Resourcindo - Indonesia
- Intertek Mineral Services - Indonesia
- Kideco Jaya Agung - Indonesia
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- Carbofer General Trading SA - India
- TeaM Sual Corporation - Philippines
- Cement Manufacturers Association - India
- Iligan Light & Power Inc, Philippines
- GVK Power & Infra Limited - India
- Madhucon Powers Ltd - India
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Asmin Koalindo Tuhup - Indonesia
- VISA Power Limited - India
- Bharathi Cement Corporation - India
- Miang Besar Coal Terminal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Eastern Energy - Thailand
- Therma Luzon, Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Vizag Seaport Private Limited - India
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Billiton Holdings Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- Jaiprakash Power Ventures ltd
- Thiess Contractors Indonesia
- Parry Sugars Refinery, India
- Grasim Industreis Ltd - India
- Goldman Sachs - Singapore
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Essar Steel Hazira Ltd - India
- Bulk Trading Sa - Switzerland
- Salva Resources Pvt Ltd - India
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- Baramulti Group, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Makarim & Taira - Indonesia
- Eastern Coal Council - USA
- Bhushan Steel Limited - India
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- Heidelberg Cement - Germany
- South Luzon Thermal Energy Corporation
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- Merrill Lynch Commodities Europe
- Ministry of Transport, Egypt
- Mintek Dendrill Indonesia
- Holcim Trading Pte Ltd - Singapore
- Pendopo Energi Batubara - Indonesia
- Malabar Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Orica Mining Services - Indonesia
- India Bulls Power Limited - India
- Thai Mozambique Logistica
- Posco Energy - South Korea
- Gujarat Mineral Development Corp Ltd - India
- Renaissance Capital - South Africa
- Samtan Co., Ltd - South Korea
- Aditya Birla Group - India
- Maharashtra Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- Parliament of New Zealand
- Georgia Ports Authority, United States
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- OPG Power Generation Pvt Ltd - India
- PTC India Limited - India
- Barasentosa Lestari - Indonesia
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- McConnell Dowell - Australia
- Sindya Power Generating Company Private Ltd
- Bangladesh Power Developement Board
- Interocean Group of Companies - India
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Energy Link Ltd, New Zealand
- Binh Thuan Hamico - Vietnam
- Semirara Mining Corp, Philippines
- Marubeni Corporation - India
- Mercuria Energy - Indonesia
- Minerals Council of Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Rio Tinto Coal - Australia
- Videocon Industries ltd - India
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Kobexindo Tractors - Indoneisa
- Borneo Indobara - Indonesia
- Port Waratah Coal Services - Australia
- Central Electricity Authority - India
- Jindal Steel & Power Ltd - India
- Riau Bara Harum - Indonesia
- Africa Commodities Group - South Africa
- Simpson Spence & Young - Indonesia
- Metalloyd Limited - United Kingdom
- Lanco Infratech Ltd - India
- Xindia Steels Limited - India
- Deloitte Consulting - India
- Coastal Gujarat Power Limited - India
- Tata Chemicals Ltd - India
- Sical Logistics Limited - India
- CNBM International Corporation - China
- Ceylon Electricity Board - Sri Lanka
- Semirara Mining and Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Indonesian Coal Mining Association
- Gujarat Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Economic Council, Georgia
- Manunggal Multi Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Baiduri Energy - Indonesia
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- White Energy Company Limited
- London Commodity Brokers - England
- Petron Corporation, Philippines
- New Zealand Coal & Carbon
- Altura Mining Limited, Indonesia
- Ambuja Cements Ltd - India
- Trasteel International SA, Italy
- Romanian Commodities Exchange
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Coal and Oil Company - UAE
- Medco Energi Mining Internasional
- The Treasury - Australian Government
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- Straits Asia Resources Limited - Singapore
- Indo Tambangraya Megah - Indonesia
- CIMB Investment Bank - Malaysia
- Toyota Tsusho Corporation, Japan
- Krishnapatnam Port Company Ltd. - India
- Oldendorff Carriers - Singapore
- Directorate Of Revenue Intelligence - India
- Indian Oil Corporation Limited
- Kohat Cement Company Ltd. - Pakistan
- Dalmia Cement Bharat India
- Banpu Public Company Limited - Thailand
- Power Finance Corporation Ltd., India
- Wilmar Investment Holdings
- ICICI Bank Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Wood Mackenzie - Singapore
- Mjunction Services Limited - India
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- PowerSource Philippines DevCo
- Singapore Mercantile Exchange
- The University of Queensland
- Australian Coal Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate General of MIneral and Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Kartika Selabumi Mining - Indonesia
- Edison Trading Spa - Italy
- Latin American Coal - Colombia
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- GAC Shipping (India) Pvt Ltd
- Central Java Power - Indonesia
- SMC Global Power, Philippines
- Aboitiz Power Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coalindo Energy - Indonesia
- Formosa Plastics Group - Taiwan
- Sinarmas Energy and Mining - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Price Waterhouse Coopers - Russia
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