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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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- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
- Bangladesh Power Developement Board
- Merrill Lynch Commodities Europe
- Alfred C Toepfer International GmbH - Germany
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- London Commodity Brokers - England
- Trasteel International SA, Italy
- Simpson Spence & Young - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bharathi Cement Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Indika Energy - Indonesia
- Bhushan Steel Limited - India
- Bukit Makmur.PT - Indonesia
- Deloitte Consulting - India
- Vedanta Resources Plc - India
- PNOC Exploration Corporation - Philippines
- Riau Bara Harum - Indonesia
- Sojitz Corporation - Japan
- Binh Thuan Hamico - Vietnam
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Baiduri Energy - Indonesia
- Ministry of Transport, Egypt
- Sakthi Sugars Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Malabar Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- VISA Power Limited - India
- Heidelberg Cement - Germany
- Sinarmas Energy and Mining - Indonesia
- Parliament of New Zealand
- Karaikal Port Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Semirara Mining Corp, Philippines
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Directorate Of Revenue Intelligence - India
- Mintek Dendrill Indonesia
- Gujarat Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Makarim & Taira - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- McConnell Dowell - Australia
- Indo Tambangraya Megah - Indonesia
- Commonwealth Bank - Australia
- Economic Council, Georgia
- Kideco Jaya Agung - Indonesia
- Orica Australia Pty. Ltd.
- Karbindo Abesyapradhi - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- GVK Power & Infra Limited - India
- Eastern Coal Council - USA
- Australian Coal Association
- Independent Power Producers Association of India
- Uttam Galva Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Anglo American - United Kingdom
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Leighton Contractors Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Posco Energy - South Korea
- Australian Commodity Traders Exchange
- Aboitiz Power Corporation - Philippines
- Energy Link Ltd, New Zealand
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Indonesian Coal Mining Association
- Madhucon Powers Ltd - India
- Global Business Power Corporation, Philippines
- Carbofer General Trading SA - India
- Coal and Oil Company - UAE
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Kobexindo Tractors - Indoneisa
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Semirara Mining and Power Corporation, Philippines
- Latin American Coal - Colombia
- Ministry of Mines - Canada
- Chettinad Cement Corporation Ltd - India
- Barasentosa Lestari - Indonesia
- Oldendorff Carriers - Singapore
- Bayan Resources Tbk. - Indonesia
- Central Electricity Authority - India
- Toyota Tsusho Corporation, Japan
- Directorate General of MIneral and Coal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Sical Logistics Limited - India
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Asmin Koalindo Tuhup - Indonesia
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ASAPP Information Group - India
- Videocon Industries ltd - India
- Timah Investasi Mineral - Indoneisa
- Marubeni Corporation - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- CIMB Investment Bank - Malaysia
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- Renaissance Capital - South Africa
- Wood Mackenzie - Singapore
- Eastern Energy - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Mercuria Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Thiess Contractors Indonesia
- Tata Chemicals Ltd - India
- European Bulk Services B.V. - Netherlands
- Price Waterhouse Coopers - Russia
- Attock Cement Pakistan Limited
- Rashtriya Ispat Nigam Limited - India
- Ministry of Finance - Indonesia
- Romanian Commodities Exchange
- San Jose City I Power Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coastal Gujarat Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Meralco Power Generation, Philippines
- Kaltim Prima Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Orica Mining Services - Indonesia
- PTC India Limited - India
- Ind-Barath Power Infra Limited - India
- Bhatia International Limited - India
- Aditya Birla Group - India
- Samtan Co., Ltd - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- South Luzon Thermal Energy Corporation
- Baramulti Group, Indonesia
- Jindal Steel & Power Ltd - India
- Grasim Industreis Ltd - India
- Xindia Steels Limited - India
- White Energy Company Limited
- Pendopo Energi Batubara - Indonesia
- TeaM Sual Corporation - Philippines
- Edison Trading Spa - Italy
- Globalindo Alam Lestari - Indonesia
- Siam City Cement - Thailand
- The State Trading Corporation of India Ltd
- Interocean Group of Companies - India
- Maharashtra Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Kumho Petrochemical, South Korea
- Minerals Council of Australia
- Planning Commission, India
- Indogreen Group - Indonesia
- Parry Sugars Refinery, India
- Central Java Power - Indonesia
- Agrawal Coal Company - India
- Petron Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- Energy Development Corp, Philippines
- Thai Mozambique Logistica
- TNB Fuel Sdn Bhd - Malaysia
- Singapore Mercantile Exchange
- Manunggal Multi Energi - Indonesia
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Intertek Mineral Services - Indonesia
- SMG Consultants - Indonesia
- SMC Global Power, Philippines
- Larsen & Toubro Limited - India
- The University of Queensland
- Goldman Sachs - Singapore
- New Zealand Coal & Carbon
- Banpu Public Company Limited - Thailand
- CNBM International Corporation - China
- Indian Oil Corporation Limited
- ICICI Bank Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- Gujarat Sidhee Cement - India
- Kalimantan Lumbung Energi - Indonesia
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- Rio Tinto Coal - Australia
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Electricity Authority, New Zealand
- Straits Asia Resources Limited - Singapore
- Wilmar Investment Holdings
- Bahari Cakrawala Sebuku - Indonesia
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Maheswari Brothers Coal Limited - India
- Jaiprakash Power Ventures ltd
- Bhoruka Overseas - Indonesia
- Indian Energy Exchange, India
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
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