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Saturday, 22 February 14
POTEN RAISES THE QUESTION OF ACCURACY IN CALCULATING TANKER FREIGHT RATES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
As the tanker market has grown in complexity over the course of the past few years, the question of whether the traditional methods of assessing rates is still valid. In a recent report, Poten & Partners noted that "the market landscape for crude oil and refined product trades has an inherent element of shifting sand, presenting an organization like the Baltic Exchange with certain challenges. The Baltic Exchange is a centuries-old institution that, among other services, oversees a collective of member shipbrokers who contribute daily freight rate assessments for the wet and dry bulk shipping markets. The freight rates that are collected by the Baltic Exchange are in turn used by both charterers and shipowners, as well as other market participants, as a reliable metric of freight pricing for internal and external financial calculations. Although the birth and death of trade lanes is a natural market evolution, such developments pose questions of relevancy to the Baltic Exchange’s data collection efforts. While the decision to discontinue a certain set of assessments due to perceived obsolescence is objectively simple, it could have broader implications for commercial market participants that have freight contracts dependent on these rates", Poten said.
According to the analyst, the Baltic Dirty Tanker Index. This index is currently comprised of 12 benchmark tanker routes, covering all trade routes and vessel sizes. The BDTI serves as an often cited reference of general health of the tanker market freight rate environment. The Baltic Exchange International Tanker Routes (BITR) are quoted on individual trades for specific cargo sizes for clean and dirty cargoes. For example, the tanker trade with the largest volume worldwide is often referred to as “TD3” or “Tanker Dirty” route number “3” – the voyage basis is from Ras Tanura, Saudi Arabia to Chiba, Japan for 265,000 metric tons of cargo".
In the report, Poten cited an announcement issued on February 5, 2014, which indicated that the Baltic Exchange was suspending their assessments of the routes “TC3_38” and “TD10D”, Aruba – New York for 38,000 metric tons of clean products and Aruba – New York for 50,000 metric tons of fuel oil, respectively. The removal of TD10D would leave the market without a Baltic Exchange instrument for quoting Panamax freight rates.
Poten noted that "in early 2012, Valero shut down their 235,000 bpd Aruba refinery, effectively rendering the voyage basis irrelevant. Historically, the Aruba refinery yielded significant volumes of fuel oil that were exported and often utilized as feedstock in Valero’s Paulsboro, N.J. refinery or for power generation on the US East Coast. The Aruba refinery eventually became structurally disadvantaged compared to US Gulf Coast refineries due to a higher operational cost base; it, like other Caribbean refineries, did not have access to cheap natural gas for power supply. Using reported spot market activity for Panamaxes loading in the Caribbean as a proxy for total market activity, trade volumes from the Caribbean to the US Atlantic Coast have become insignificant. Although still a relatively small market, fixture activity has increased for the Caribbean to US Gulf trade".
It added that "it stands to reason that the Baltic Exchange should continue to assess at least one dirty Panamax trade route. Contracts of Affreightment, or COAs, whereby shipowners and oil companies pre-arrange transportation volumes over a specified period of time, often incorporate some kind of discount to prevailing spot market rates. In exchange for a guaranteed volume of business from an oil company, a shipowner or pool will typically offer a discount to market rates. The Baltic Exchange rate assessments are often referenced in contract language accordingly. The same logic applies for time charters that involve profit sharing elements; shipowners and charterers agree how the profit share will be determined based on independent freight rate assessments.
In the case of TD10D, the Baltic Exchange might consider changing the voyage basis in order to prevent commerical disruption. Load ports for crude export in countries such as Venezuela, Colombia or Trinidad are viable options and the destination should, undoubtedly, be in the US Gulf. The question of what to do with the Aruba to New York (TC3) benchmark for clean products is more black and white. The sizeable increase in refined products exports from the US Gulf to the Caribbean and Latin American countries has displaced imports from the Caribbean. With strong refining economics in the US Gulf, it is difficult to see any reversal in this trend anytime soon", Poten concluded.
source: Nikos Roussanoglou, Hellenic Shipping News
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Monday, 14 April 14
CHINA'S MEASURES TO STIMULATE ECONOMY'S GROWTH COULD OFFER ROOM FOR STABILITY IN SHIPPING MARKETS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Since the outbreak of the 2008-crisis, the shipping industry, in most of its aspects, i.e. dry bulk and tanker markets alike, has been dealing w ...
Sunday, 13 April 14
INDONESIA TO INDIA FREIGHT MARKET DECLINE CONTINUES
COALspot.com: The freight market continued to drop this week and BDI almost touched 1000 points. BDI closed at 1002 points fell 16.85 pct week o ...
Saturday, 12 April 14
HOW DO YOU CALCULATE LOSS OF EARNINGS FOLLOWING A COLLISION? - INCE & CO
KNOWLEDGE TO ELEVATE
The recent case of Astipalaia vs Hanjin Shenzhen [2014] EWHC 120 (Admlty) has revisited the existing case law on asses ...
Friday, 11 April 14
US COAL PRODUCTION IN MARCH INCREASED 9.69% TO 82.6 MMST MONTH ON MONTH
COALspot.com – United States the world's second largest coal producer, produced approximately 19.10 million short tons (mmst) of coal ...
Thursday, 10 April 14
DRY BULK MARKET IS RISING CLAIMS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite the recent fall of the Baltic Dry Index (BDI), when one compares the first quarter of 2014, to similar quarters of the recent past, it i ...
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- Kaltim Prima Coal - Indonesia
- Marubeni Corporation - India
- Ministry of Mines - Canada
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Bulk Trading Sa - Switzerland
- Grasim Industreis Ltd - India
- Electricity Authority, New Zealand
- South Luzon Thermal Energy Corporation
- Oldendorff Carriers - Singapore
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Bharathi Cement Corporation - India
- Bhoruka Overseas - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Intertek Mineral Services - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Riau Bara Harum - Indonesia
- The State Trading Corporation of India Ltd
- European Bulk Services B.V. - Netherlands
- Globalindo Alam Lestari - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thai Mozambique Logistica
- Holcim Trading Pte Ltd - Singapore
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Siam City Cement - Thailand
- Jindal Steel & Power Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Karaikal Port Pvt Ltd - India
- Indogreen Group - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Global Business Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Bukit Asam (Persero) Tbk - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Wood Mackenzie - Singapore
- Parliament of New Zealand
- Latin American Coal - Colombia
- Directorate Of Revenue Intelligence - India
- Billiton Holdings Pty Ltd - Australia
- Heidelberg Cement - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ICICI Bank Limited - India
- GVK Power & Infra Limited - India
- Uttam Galva Steels Limited - India
- Videocon Industries ltd - India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Georgia Ports Authority, United States
- Romanian Commodities Exchange
- Maharashtra Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Barasentosa Lestari - Indonesia
- Minerals Council of Australia
- Maheswari Brothers Coal Limited - India
- Meralco Power Generation, Philippines
- Bhushan Steel Limited - India
- Economic Council, Georgia
- Tata Chemicals Ltd - India
- Mjunction Services Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kumho Petrochemical, South Korea
- Neyveli Lignite Corporation Ltd, - India
- Manunggal Multi Energi - Indonesia
- Anglo American - United Kingdom
- Savvy Resources Ltd - HongKong
- Simpson Spence & Young - Indonesia
- Coastal Gujarat Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Kartika Selabumi Mining - Indonesia
- Chamber of Mines of South Africa
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Chettinad Cement Corporation Ltd - India
- Energy Development Corp, Philippines
- London Commodity Brokers - England
- Metalloyd Limited - United Kingdom
- Power Finance Corporation Ltd., India
- Renaissance Capital - South Africa
- Sinarmas Energy and Mining - Indonesia
- Commonwealth Bank - Australia
- Jorong Barutama Greston.PT - Indonesia
- Sojitz Corporation - Japan
- Kobexindo Tractors - Indoneisa
- Coalindo Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Posco Energy - South Korea
- Sindya Power Generating Company Private Ltd
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- SMG Consultants - Indonesia
- GMR Energy Limited - India
- Vizag Seaport Private Limited - India
- PTC India Limited - India
- Price Waterhouse Coopers - Russia
- Asmin Koalindo Tuhup - Indonesia
- MS Steel International - UAE
- Eastern Coal Council - USA
- Ind-Barath Power Infra Limited - India
- McConnell Dowell - Australia
- International Coal Ventures Pvt Ltd - India
- Cement Manufacturers Association - India
- Africa Commodities Group - South Africa
- Mintek Dendrill Indonesia
- Jaiprakash Power Ventures ltd
- AsiaOL BioFuels Corp., Philippines
- Samtan Co., Ltd - South Korea
- Global Green Power PLC Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- PowerSource Philippines DevCo
- Salva Resources Pvt Ltd - India
- The Treasury - Australian Government
- Petron Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- White Energy Company Limited
- India Bulls Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Mercuria Energy - Indonesia
- New Zealand Coal & Carbon
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhatia International Limited - India
- Attock Cement Pakistan Limited
- Kapuas Tunggal Persada - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- Coal and Oil Company - UAE
- Antam Resourcindo - Indonesia
- Standard Chartered Bank - UAE
- Sree Jayajothi Cements Limited - India
- Dalmia Cement Bharat India
- Australian Commodity Traders Exchange
- Sarangani Energy Corporation, Philippines
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Bukit Baiduri Energy - Indonesia
- Larsen & Toubro Limited - India
- Australian Coal Association
- The University of Queensland
- Sical Logistics Limited - India
- Aboitiz Power Corporation - Philippines
- Edison Trading Spa - Italy
- Bayan Resources Tbk. - Indonesia
- Mercator Lines Limited - India
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Transport, Egypt
- Goldman Sachs - Singapore
- Deloitte Consulting - India
- San Jose City I Power Corp, Philippines
- Central Java Power - Indonesia
- Ambuja Cements Ltd - India
- Baramulti Group, Indonesia
- Orica Australia Pty. Ltd.
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vedanta Resources Plc - India
- Planning Commission, India
- Vijayanagar Sugar Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- TeaM Sual Corporation - Philippines
- Gujarat Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- Malabar Cements Ltd - India
- VISA Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Therma Luzon, Inc, Philippines
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Straits Asia Resources Limited - Singapore
- Formosa Plastics Group - Taiwan
- Bangladesh Power Developement Board
- ASAPP Information Group - India
- Banpu Public Company Limited - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Borneo Indobara - Indonesia
- Central Electricity Authority - India
- Merrill Lynch Commodities Europe
- Global Coal Blending Company Limited - Australia
- Indika Energy - Indonesia
- Agrawal Coal Company - India
- Interocean Group of Companies - India
- Indian Energy Exchange, India
- GN Power Mariveles Coal Plant, Philippines
- CIMB Investment Bank - Malaysia
- PNOC Exploration Corporation - Philippines
- Makarim & Taira - Indonesia
- Meenaskhi Energy Private Limited - India
- Singapore Mercantile Exchange
- Ministry of Finance - Indonesia
- Xindia Steels Limited - India
- Semirara Mining Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Star Paper Mills Limited - India
- Aditya Birla Group - India
- Trasteel International SA, Italy
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- GAC Shipping (India) Pvt Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Electricity Generating Authority of Thailand
- Carbofer General Trading SA - India
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