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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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Tuesday, 04 September 12
ORPHEUS SECURES ADDITIONAL SIGNIFICANT KINTAP COAL PROJECT IN SOUTH KALIMANTAN
COALspot.com - Indonesian coal producer, Orpheus Energy (ASX:OEG) has announced that it has secured a 50% equity ownership in an additional tenement ...
Monday, 03 September 12
SHIPOWNERS TO WAIT FOR FURTHER PRICE REDUCTIONS IN THE SECOND HAND VESSEL MARKETS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With September now upon us, shipbrokers are looking towards an interesting winter season, as ship owners are looking to capitalize on more second ha ...
Sunday, 02 September 12
ADAROS COAL ROYALTIES TO THE GOVERNMENT INCREASED BY 10.5 PERCENT Y-O-Y TO US$196.8 MILLION
COALspot.com - PT Adaro Energy Tbk (IDX: ADRO), the second largest power plant coal producer in Indonesia, announced its consolidated auditor-review ...
Saturday, 01 September 12
FALLING PRICES; BLEEDING MINERS
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for October 2012 delivery lost 4.070 percent and 0.422 percent respectively on W-o-W and D- ...
Saturday, 01 September 12
PANAMAX FREIGHT RATES UNDER PRESSURE FROM LOW DEMAND - VISTAAR
COALspot.com - This week the freight market was weak with mixed results.
The BDI was down by 1.95 pct closing at 703 points, however there was so ...
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- Chamber of Mines of South Africa
- Meralco Power Generation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- White Energy Company Limited
- Mintek Dendrill Indonesia
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- Kumho Petrochemical, South Korea
- Indika Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Malabar Cements Ltd - India
- LBH Netherlands Bv - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Trasteel International SA, Italy
- Gujarat Mineral Development Corp Ltd - India
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Eastern Energy - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Xindia Steels Limited - India
- Agrawal Coal Company - India
- Kalimantan Lumbung Energi - Indonesia
- Latin American Coal - Colombia
- European Bulk Services B.V. - Netherlands
- Indogreen Group - Indonesia
- Thiess Contractors Indonesia
- Sindya Power Generating Company Private Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sojitz Corporation - Japan
- Wood Mackenzie - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Salva Resources Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Toyota Tsusho Corporation, Japan
- Karbindo Abesyapradhi - Indoneisa
- CIMB Investment Bank - Malaysia
- Singapore Mercantile Exchange
- TeaM Sual Corporation - Philippines
- Siam City Cement - Thailand
- Semirara Mining and Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Karaikal Port Pvt Ltd - India
- Petron Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Orica Australia Pty. Ltd.
- Bhatia International Limited - India
- Jindal Steel & Power Ltd - India
- Coalindo Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kartika Selabumi Mining - Indonesia
- Vizag Seaport Private Limited - India
- Eastern Coal Council - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- Leighton Contractors Pty Ltd - Australia
- Orica Mining Services - Indonesia
- Ambuja Cements Ltd - India
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Posco Energy - South Korea
- Deloitte Consulting - India
- Grasim Industreis Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Pendopo Energi Batubara - Indonesia
- London Commodity Brokers - England
- Larsen & Toubro Limited - India
- ICICI Bank Limited - India
- Holcim Trading Pte Ltd - Singapore
- Bangladesh Power Developement Board
- The State Trading Corporation of India Ltd
- Savvy Resources Ltd - HongKong
- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- Global Business Power Corporation, Philippines
- Mjunction Services Limited - India
- PTC India Limited - India
- Kepco SPC Power Corporation, Philippines
- Economic Council, Georgia
- Wilmar Investment Holdings
- Metalloyd Limited - United Kingdom
- Gujarat Sidhee Cement - India
- Australian Coal Association
- Energy Link Ltd, New Zealand
- Dalmia Cement Bharat India
- Gujarat Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Africa Commodities Group - South Africa
- Ind-Barath Power Infra Limited - India
- Intertek Mineral Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Uttam Galva Steels Limited - India
- Cement Manufacturers Association - India
- GAC Shipping (India) Pvt Ltd
- Carbofer General Trading SA - India
- OPG Power Generation Pvt Ltd - India
- Bhushan Steel Limited - India
- Essar Steel Hazira Ltd - India
- Vedanta Resources Plc - India
- PowerSource Philippines DevCo
- India Bulls Power Limited - India
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- Lanco Infratech Ltd - India
- Price Waterhouse Coopers - Russia
- Edison Trading Spa - Italy
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- International Coal Ventures Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- The University of Queensland
- Neyveli Lignite Corporation Ltd, - India
- Rio Tinto Coal - Australia
- SMC Global Power, Philippines
- Madhucon Powers Ltd - India
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parliament of New Zealand
- SMG Consultants - Indonesia
- McConnell Dowell - Australia
- MS Steel International - UAE
- Bhoruka Overseas - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Electricity Authority, New Zealand
- Tamil Nadu electricity Board
- Parry Sugars Refinery, India
- Sree Jayajothi Cements Limited - India
- Timah Investasi Mineral - Indoneisa
- Romanian Commodities Exchange
- Globalindo Alam Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Borneo Indobara - Indonesia
- Bukit Baiduri Energy - Indonesia
- Anglo American - United Kingdom
- Coastal Gujarat Power Limited - India
- Banpu Public Company Limited - Thailand
- Sical Logistics Limited - India
- Baramulti Group, Indonesia
- Jaiprakash Power Ventures ltd
- Manunggal Multi Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- PNOC Exploration Corporation - Philippines
- Marubeni Corporation - India
- Sinarmas Energy and Mining - Indonesia
- SN Aboitiz Power Inc, Philippines
- Port Waratah Coal Services - Australia
- Makarim & Taira - Indonesia
- Independent Power Producers Association of India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- San Jose City I Power Corp, Philippines
- Kobexindo Tractors - Indoneisa
- CNBM International Corporation - China
- South Luzon Thermal Energy Corporation
- Central Java Power - Indonesia
- Tata Chemicals Ltd - India
- Central Electricity Authority - India
- Medco Energi Mining Internasional
- Semirara Mining Corp, Philippines
- Altura Mining Limited, Indonesia
- Therma Luzon, Inc, Philippines
- Goldman Sachs - Singapore
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Bukit Asam (Persero) Tbk - Indonesia
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- IHS Mccloskey Coal Group - USA
- Rashtriya Ispat Nigam Limited - India
- Kaltim Prima Coal - Indonesia
- Minerals Council of Australia
- Directorate Of Revenue Intelligence - India
- Formosa Plastics Group - Taiwan
- Samtan Co., Ltd - South Korea
- VISA Power Limited - India
- Mercator Lines Limited - India
- Ministry of Mines - Canada
- TNB Fuel Sdn Bhd - Malaysia
- New Zealand Coal & Carbon
- Kideco Jaya Agung - Indonesia
- Bulk Trading Sa - Switzerland
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Antam Resourcindo - Indonesia
- ASAPP Information Group - India
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Georgia Ports Authority, United States
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Riau Bara Harum - Indonesia
- Energy Development Corp, Philippines
- Indian Energy Exchange, India
- Siam City Cement PLC, Thailand
- Simpson Spence & Young - Indonesia
- Bukit Makmur.PT - Indonesia
- Interocean Group of Companies - India
- Power Finance Corporation Ltd., India
- Kapuas Tunggal Persada - Indonesia
- Standard Chartered Bank - UAE
- Chettinad Cement Corporation Ltd - India
- IEA Clean Coal Centre - UK
- Petrochimia International Co. Ltd.- Taiwan
- Indian Oil Corporation Limited
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- Binh Thuan Hamico - Vietnam
- Electricity Generating Authority of Thailand
- Alfred C Toepfer International GmbH - Germany
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