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Tuesday, 04 September 12
SHIP OWNERS' COMPETITION LEADS TO TANKER FIXTURES BELOW OPERATING COSTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 Ship owners operating in the VLCC tanker markets are increasingly finding it difficult to obtain even breakeven rates for their vessels, as competition has intensified. In its latest weekly report, Braemar Seascope noted that the willingness of owners to continue the trend of fixing their vessels at below operating costs, means that they are in essence paying for the pleasure of transportation for their clients. "By offering this service they are also increasing their maintenance costs, and it seems that for one reason or another, the "layup" option seems to have been taken off the table. There are a few owners who have said they are unwilling to fix at these levels. However, unfortunately for the three or four who refuse to trade, there are five or six who are willing to accept the prevailing levels. Owners have been adjusting ballast speeds to super-slow and other money saving methods, but this seems to be perpetuating the trend" said the report.
It added that "this week has seen charterers fixing steadily, drip feeding the market. Most cargoes have attracted offers until a full complement of 8-10 has been received and rates of previously done or lower have been concluded. Even in the face of rising bunker prices, PG/West has remained at 280kt x ws23.0 via Cape and in some cases, ws22.0 via Suez. This highlights the fact that fixing via the Suez Canal is a huge saving on bunker costs.
West Africa has been mirroring the PG. Rates are very low and flat at 260kt x ws36.0-37.0 for W Africa/East. W Africa/West has not really been traded as a very depressed Suezmax market has been able to fulfil requirements. From Indian charterers ex-W Africa this week, IOC entered the market for W Africa/EC India off 27-28 September. Charterers took advantage of the continuing pressure being put on rates in this region by the eastern ballasters, and fixed the business at just a whisker under the US$3.0m mark. With the September programme ex-W Africa completed, the Indian charterers are now awaiting the laycans for their early October stems, which we expect to see firm by mid next week. We are assessing W Africa/WC India at US$2.75m and W Africa/WC India at US$3.0m.
The 30 day availability index shows 53 VLCCs arriving at Fujairah, of which five are over 15 years old, compared to last week’s total of 55. So far for September we have seen 59 VLCC fixtures reported from PG, compared with a total of 116 for August. Despite resistance from those owners unwilling to trade, those willing to continue to conclude business at present freight levels are more than sufficient to satisfy charterers’ requirements. It remains to be seen how sustainable present freight levels and daily earnings can be" Braemar concluded on the VLCC markets.
SUEZMAX
Meanwhile, in the Suezmax front this week, the report noted that "the West Africa market maintained reasonable levels of activity without inspiring a noticeable improvement in rates. Cargoes have been taken on by owners rapidly, and the lack of resistance has led to rates mirroring those from last week. West Africa / US Gulf still sits at ws55.0 with the standard 2.5pt mark-up to US Atlantic Coast & UKCont-Med. Whilst most of the early vessels have been accounted for, the 2nd decade of September is overloaded and will soak up any imminent demand. With cargoes entering 3rd decade dates, this does not provide much promise for those owners who have been sitting tight. Unfortunately, with the Mediterranean not offering much respite, it looks like many of those owners across the Atlantic who can make these dates will opt to ballast into the West Africa region and perpetuate or even undercut current rates.
In the Mediterranean, despite a few eastbound cargoes fixing, activity has been low. Voyages to the Far East have been achieving US$2.9m to US$3.0m, with a trip to India fetching US$2.2m. Cross-Med fixtures have been scarce with a short Arzew / Lavera 130kt x ws65.0, offering little perspective on the actual market. Worryingly a Mediterranean –US Gulf run was fixed at just ws47.5. In the Black Sea, a couple of charterers have been active, with a market rate of 140kt x ws55.0 meeting little resistance from either party, and toward the end of the week ws52.5 was fixed to the US Gulf. Whilst the odd fixture east should have lightened the load, the position list is so bloated that realistic owners will want to fix and get out of the market as soon as they can, so eastern runs should be attractive.
Towards the end of last week several cargoes were open in the PG, but these have been whittled down. After last week's enthusiastic climb to ws75.0 PG/West, the crippling effect of a fixture at ws55.0 has continued, with ws52.5 and ws50.0 fixed. There has been flat activity going east, but enough to back up last week's estimation that this market has some legs. 118kt x ws79.0 to East Coast India might not be a great indication of the market, but 130kt x ws77.0 to Vadinar was backed up by 126kt x ws87.0 to West Coast India and hopefully the reasonable levels of activity will relieve the position list and support the market for PG-West fixtures" said Braemar.
AFRAMAX
Finally, in the Aframax market, the company's report said that "with a short fixing week following the UK Bank holiday, general activity has been marginally better than the previous two weeks. However, rates in the Baltic remain unchanged with the market still over tonnaged and demand quieter as expected in the month of August. TD17 remains flat at 100kt x ws60.0 and we expect no change looking in to next week. Cargoes from the ports of Primorsk and Ust-Luga are currently fixing in the 10-15 September window. North Sea demand has been more or less non-existent with TD7 rates also flat at 80kt x ws85.0. In the Mediterranean and Black Sea, it has been a very quiet week again. Compared to the available tonnage, enquiry has been minimal. Owners are accepting in the region of 80kt x ws77.5 for cross Med voyages, and from the Black Sea 80kt x ws79.0, which we estimate is close to breaking even in terms of earnings.
Currently, there is a Black Sea market quote, and with plenty of prompt ships spot in the Black Sea meaning ballast is minimised, we expect a few more points to be shaved off. At present, there are no signs of any improvements in the eyes of the owners. Further west in the Caribbean, with both the Amuay Bay refinery fire and hurricane "Isaac" causing some uncertainty and delays, one would have expected freight rates to move upwards on the back of it. Rates did firm slightly since this time last week to currently 70kt x ws95.0, however the Amuay Bay failed to have much impact and hurricane "Isaac" is not expected to have a lengthy impact. This of course, does not help the market or owners, but many will be pleased that hurricane "Isaac" is not expected to cause the same devastation as hurricane "Katrina" did seven years ago. Looking in to next week, we would expect the market to remain at current levels. It has been an exciting week in the PG with lots of action seen compared to previous weeks. PG/East rates are moving upwards to ws115.0 due to an influx of cargoes in the market, causing the availability of tonnage to thin down. Consequently, owner sentiment has remained bullish.
Indonesia/North Asia rates have softened to ws87.5 due to the current typhoon situation, where charterers are carefully withholding their requirements to avoid vessels missing their dates. Not much change to TD14 this week, with rates firming at ws90.0, providing a TCE of around US$5,700/day. Fixing volume out of NW Shelf to North Asia has been fairly light. Sustainability in rates is highly unlikely as activity slows and the tonnage list lengthens" Braemar concluded.
Source: Nikos Roussanoglou, Hellenic Shipping
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Thursday, 04 October 12
CAPESIZE : IN SPITE OF THE HOLIDAYS IN CHINA, RATES ARE CLIMBING UP - FEARNLEYS AS
Handy
Atlantic market remains quiet due to lack of cargoes and more supply of ships. Rates from Continent to east Med were around USD 13k and Black ...
Wednesday, 03 October 12
BARCLAYS'S PRICE FORECAST FOR NEWCASTLE COAL HAS BEEN WRITTEN DOWN
“ The main story in the global coal markets has been the growth in supply, with all of the major exporters adding volumes into a market which ...
Sunday, 30 September 12
SUB-BIT INDONESIA COAL SWAPS: MIXED TREND
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for November 2012 delivery lost 0.73 percent w-o-w but gained 0.41 percent d-o-d on Friday, 28 Se ...
Sunday, 30 September 12
INDONESIA HAS NO PLAN TO CAP COAL PRODUCTION
COALspot.com - “The current low coal prices were mainly due to a global oversupply condition, spurred by numerous mining exploitations in the ...
Sunday, 30 September 12
FREIGHT MARKET UNDER PRESSURE; OVERALL SENTIMENTS ARE STILL BEARISH
COALspot.com - The freight market seemed to have lost steam and all indices were down except for cape index.
The BDI was slightly down by 6 point ...
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- Sinarmas Energy and Mining - Indonesia
- Standard Chartered Bank - UAE
- Intertek Mineral Services - Indonesia
- Independent Power Producers Association of India
- Malabar Cements Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Central Java Power - Indonesia
- Power Finance Corporation Ltd., India
- Therma Luzon, Inc, Philippines
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- TeaM Sual Corporation - Philippines
- PowerSource Philippines DevCo
- CIMB Investment Bank - Malaysia
- Wilmar Investment Holdings
- Lanco Infratech Ltd - India
- AsiaOL BioFuels Corp., Philippines
- European Bulk Services B.V. - Netherlands
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Alfred C Toepfer International GmbH - Germany
- Toyota Tsusho Corporation, Japan
- Sojitz Corporation - Japan
- Samtan Co., Ltd - South Korea
- White Energy Company Limited
- Sical Logistics Limited - India
- VISA Power Limited - India
- London Commodity Brokers - England
- PNOC Exploration Corporation - Philippines
- Dalmia Cement Bharat India
- Cement Manufacturers Association - India
- Australian Coal Association
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Medco Energi Mining Internasional
- SMG Consultants - Indonesia
- Timah Investasi Mineral - Indoneisa
- Videocon Industries ltd - India
- CNBM International Corporation - China
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Asmin Koalindo Tuhup - Indonesia
- Bangladesh Power Developement Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kobexindo Tractors - Indoneisa
- Madhucon Powers Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- SMC Global Power, Philippines
- Global Business Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement PLC, Thailand
- Agrawal Coal Company - India
- Carbofer General Trading SA - India
- Pipit Mutiara Jaya. PT, Indonesia
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Tamil Nadu electricity Board
- Larsen & Toubro Limited - India
- LBH Netherlands Bv - Netherlands
- Riau Bara Harum - Indonesia
- Meenaskhi Energy Private Limited - India
- Eastern Energy - Thailand
- Latin American Coal - Colombia
- Mintek Dendrill Indonesia
- Kumho Petrochemical, South Korea
- Bulk Trading Sa - Switzerland
- Pendopo Energi Batubara - Indonesia
- Heidelberg Cement - Germany
- Ind-Barath Power Infra Limited - India
- GMR Energy Limited - India
- Interocean Group of Companies - India
- Georgia Ports Authority, United States
- Meralco Power Generation, Philippines
- Indika Energy - Indonesia
- Anglo American - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- Central Electricity Authority - India
- IHS Mccloskey Coal Group - USA
- Wood Mackenzie - Singapore
- Indian Energy Exchange, India
- Sindya Power Generating Company Private Ltd
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Altura Mining Limited, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Posco Energy - South Korea
- Banpu Public Company Limited - Thailand
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- India Bulls Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Grasim Industreis Ltd - India
- Kideco Jaya Agung - Indonesia
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Attock Cement Pakistan Limited
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- IEA Clean Coal Centre - UK
- Chettinad Cement Corporation Ltd - India
- Aditya Birla Group - India
- Energy Link Ltd, New Zealand
- Siam City Cement - Thailand
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Thai Mozambique Logistica
- Ministry of Mines - Canada
- Karaikal Port Pvt Ltd - India
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- South Luzon Thermal Energy Corporation
- New Zealand Coal & Carbon
- Leighton Contractors Pty Ltd - Australia
- Borneo Indobara - Indonesia
- San Jose City I Power Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Trasteel International SA, Italy
- Orica Australia Pty. Ltd.
- Port Waratah Coal Services - Australia
- Maheswari Brothers Coal Limited - India
- Bukit Makmur.PT - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Krishnapatnam Port Company Ltd. - India
- Commonwealth Bank - Australia
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- Bhushan Steel Limited - India
- SN Aboitiz Power Inc, Philippines
- Mercator Lines Limited - India
- Minerals Council of Australia
- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Holcim Trading Pte Ltd - Singapore
- Global Green Power PLC Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The University of Queensland
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Billiton Holdings Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Price Waterhouse Coopers - Russia
- Bayan Resources Tbk. - Indonesia
- Baramulti Group, Indonesia
- ICICI Bank Limited - India
- Parry Sugars Refinery, India
- Deloitte Consulting - India
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- Electricity Authority, New Zealand
- Chamber of Mines of South Africa
- Ministry of Finance - Indonesia
- PTC India Limited - India
- Kaltim Prima Coal - Indonesia
- Ministry of Transport, Egypt
- Kapuas Tunggal Persada - Indonesia
- Orica Mining Services - Indonesia
- Jindal Steel & Power Ltd - India
- Africa Commodities Group - South Africa
- Singapore Mercantile Exchange
- GAC Shipping (India) Pvt Ltd
- Makarim & Taira - Indonesia
- ASAPP Information Group - India
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Baiduri Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Renaissance Capital - South Africa
- Indo Tambangraya Megah - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Jaiprakash Power Ventures ltd
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- The State Trading Corporation of India Ltd
- Bharathi Cement Corporation - India
- OPG Power Generation Pvt Ltd - India
- Australian Commodity Traders Exchange
- Formosa Plastics Group - Taiwan
- Tata Chemicals Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Coal and Oil Company - UAE
- Eastern Coal Council - USA
- Marubeni Corporation - India
- Semirara Mining Corp, Philippines
- Economic Council, Georgia
- Binh Thuan Hamico - Vietnam
- Mercuria Energy - Indonesia
- The Treasury - Australian Government
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Simpson Spence & Young - Indonesia
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- Directorate Of Revenue Intelligence - India
- Romanian Commodities Exchange
- Gujarat Sidhee Cement - India
- Sakthi Sugars Limited - India
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Indian Oil Corporation Limited
- Vijayanagar Sugar Pvt Ltd - India
- Ambuja Cements Ltd - India
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Rio Tinto Coal - Australia
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