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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, 07 April 14
WEEKLY SUB-BIT FOB INDONESIA COAL SWAP CLAIMS EDGE FALL; TREND NEGATIVE
COALspot.com: Indonesian coal swaps for average Q4’ 2014 lost on month, day and on week according to AsiaClear OTC coal swap's reports ...
Monday, 07 April 14
API 8 CFR SOUTH CHINA COAL SWAPS GAINED 2.09% M-O-M
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries gained 2.09 percent month on month and closed at US$ 75.68 per ...
Sunday, 06 April 14
THE FREIGHT MARKET KEEPS SLIDING
COALspot.com: The freight market continued to drop this week. The BDI (Baltic Dry Index) is a widely followed metric that reflects the overall r ...
Friday, 04 April 14
UNITED STATES COAL OUTPUT UP 5.4% IN PAST WEEK
COALspot.com – United States the world's second largest coal producer, produced approximately 19.9 million short tons (mmst) of coal i ...
Thursday, 03 April 14
PANAMAX SECTOR IS WATCHING A SEVERE DROP IN RATES - FEARNLEYS
Handy
A further weaker sentiment for the Supras as well in both hemispheres this week with oversupply of tonnage being the major headline. Tra ...
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- PTC India Limited - India
- ICICI Bank Limited - India
- Australian Coal Association
- India Bulls Power Limited - India
- Mjunction Services Limited - India
- Economic Council, Georgia
- Essar Steel Hazira Ltd - India
- Sical Logistics Limited - India
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Business Power Corporation, Philippines
- SMC Global Power, Philippines
- Heidelberg Cement - Germany
- International Coal Ventures Pvt Ltd - India
- MS Steel International - UAE
- Eastern Coal Council - USA
- Kobexindo Tractors - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Australian Commodity Traders Exchange
- Anglo American - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Romanian Commodities Exchange
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
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- Commonwealth Bank - Australia
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- Holcim Trading Pte Ltd - Singapore
- Port Waratah Coal Services - Australia
- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- GMR Energy Limited - India
- Vedanta Resources Plc - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
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- Formosa Plastics Group - Taiwan
- Kumho Petrochemical, South Korea
- Tamil Nadu electricity Board
- Merrill Lynch Commodities Europe
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- Electricity Authority, New Zealand
- Mercuria Energy - Indonesia
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- Attock Cement Pakistan Limited
- VISA Power Limited - India
- Star Paper Mills Limited - India
- IHS Mccloskey Coal Group - USA
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- Central Electricity Authority - India
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- Trasteel International SA, Italy
- Toyota Tsusho Corporation, Japan
- Price Waterhouse Coopers - Russia
- Bulk Trading Sa - Switzerland
- Iligan Light & Power Inc, Philippines
- Uttam Galva Steels Limited - India
- SMG Consultants - Indonesia
- Parliament of New Zealand
- Parry Sugars Refinery, India
- Marubeni Corporation - India
- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- Barasentosa Lestari - Indonesia
- Indonesian Coal Mining Association
- Manunggal Multi Energi - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Miang Besar Coal Terminal - Indonesia
- Bayan Resources Tbk. - Indonesia
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SN Aboitiz Power Inc, Philippines
- Wood Mackenzie - Singapore
- Intertek Mineral Services - Indonesia
- Kartika Selabumi Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- White Energy Company Limited
- Globalindo Alam Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Jorong Barutama Greston.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Vizag Seaport Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- McConnell Dowell - Australia
- Ministry of Transport, Egypt
- Bhatia International Limited - India
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Siam City Cement - Thailand
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Java Power - Indonesia
- Mintek Dendrill Indonesia
- Bangladesh Power Developement Board
- Standard Chartered Bank - UAE
- Electricity Generating Authority of Thailand
- Karaikal Port Pvt Ltd - India
- Indika Energy - Indonesia
- The University of Queensland
- Rio Tinto Coal - Australia
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Planning Commission, India
- Thai Mozambique Logistica
- PetroVietnam Power Coal Import and Supply Company
- AsiaOL BioFuels Corp., Philippines
- Cigading International Bulk Terminal - Indonesia
- Larsen & Toubro Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Lanco Infratech Ltd - India
- Therma Luzon, Inc, Philippines
- Goldman Sachs - Singapore
- Makarim & Taira - Indonesia
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Neyveli Lignite Corporation Ltd, - India
- Thiess Contractors Indonesia
- Meenaskhi Energy Private Limited - India
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- Mercator Lines Limited - India
- Petron Corporation, Philippines
- CNBM International Corporation - China
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- Simpson Spence & Young - Indonesia
- Edison Trading Spa - Italy
- Metalloyd Limited - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Minerals Council of Australia
- Xindia Steels Limited - India
- Georgia Ports Authority, United States
- Medco Energi Mining Internasional
- San Jose City I Power Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GVK Power & Infra Limited - India
- Altura Mining Limited, Indonesia
- Borneo Indobara - Indonesia
- Kepco SPC Power Corporation, Philippines
- Agrawal Coal Company - India
- Coal and Oil Company - UAE
- Kapuas Tunggal Persada - Indonesia
- Bhushan Steel Limited - India
- Meralco Power Generation, Philippines
- Siam City Cement PLC, Thailand
- London Commodity Brokers - England
- TNB Fuel Sdn Bhd - Malaysia
- Krishnapatnam Port Company Ltd. - India
- Vijayanagar Sugar Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Maharashtra Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Coalindo Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- CIMB Investment Bank - Malaysia
- The Treasury - Australian Government
- Alfred C Toepfer International GmbH - Germany
- Bahari Cakrawala Sebuku - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- South Luzon Thermal Energy Corporation
- Salva Resources Pvt Ltd - India
- Singapore Mercantile Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- OPG Power Generation Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Orica Mining Services - Indonesia
- Malabar Cements Ltd - India
- Indogreen Group - Indonesia
- Riau Bara Harum - Indonesia
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Energy Development Corp, Philippines
- Deloitte Consulting - India
- Carbofer General Trading SA - India
- GAC Shipping (India) Pvt Ltd
- Sakthi Sugars Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- Videocon Industries ltd - India
- Energy Link Ltd, New Zealand
- Bukit Makmur.PT - Indonesia
- Power Finance Corporation Ltd., India
- Bharathi Cement Corporation - India
- Cement Manufacturers Association - India
- Indian Oil Corporation Limited
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- Eastern Energy - Thailand
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