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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, 31 March 14
CFR SOUTH CHINA COAL SWAP FOR Q2 14 DELIVERY LOST 1.17% M-O-M
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 1.17 percent month on month and closed at US$ 75.38 per m ...
Sunday, 30 March 14
FREIGHTS FROM INDONESIA TO INDIA IS EXPECTED TO BE SOFT NEXT WEEK - REDDY
COALspot.com: The freight market dropped drastically and all sectors were affected severely.
The BDI was down by 14.13 pct and closed at 1, ...
Friday, 28 March 14
US PRODUCED APPROXIMATELY 18.9 MMST IN A WEEK - EIA
COALspot.com – United States the world's second largest coal producer, produced approximately 18.9 million short tons (mmst) of coal i ...
Friday, 28 March 14
CHINA'S ENVIRONMENTAL MEASURES WILL NOT CURB GROWTH IN DOMESTIC STEEL PRODUCTION AND SEABORNE IRON ORE - WOOD MACKENZIE SAYS
Steel plants in China have been targeted as a major source of the toxic smog enveloping Beijing and Shanghai. Emergency measures have been impos ...
Thursday, 27 March 14
PANAMAX : SEEMS TO HEAD FURTHER DOWN; CAPESIZE : ANOTHER CHOPPY AND UNPREDICTABLE WEEK - FEARNLEYS AS
Handy
A weaker sentiment for the smaller size as well, with reduced activity in the Atlantic where Owners have to face significantly lower ret ...
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- AsiaOL BioFuels Corp., Philippines
- Price Waterhouse Coopers - Russia
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Sojitz Corporation - Japan
- Ministry of Mines - Canada
- Indian Energy Exchange, India
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Coal Association
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Coal and Oil Company - UAE
- VISA Power Limited - India
- Binh Thuan Hamico - Vietnam
- Makarim & Taira - Indonesia
- MS Steel International - UAE
- Intertek Mineral Services - Indonesia
- Bhatia International Limited - India
- Therma Luzon, Inc, Philippines
- Antam Resourcindo - Indonesia
- Parliament of New Zealand
- LBH Netherlands Bv - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- Ministry of Transport, Egypt
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Iligan Light & Power Inc, Philippines
- Trasteel International SA, Italy
- Karaikal Port Pvt Ltd - India
- GVK Power & Infra Limited - India
- Central Electricity Authority - India
- Global Green Power PLC Corporation, Philippines
- Standard Chartered Bank - UAE
- Bhushan Steel Limited - India
- Mintek Dendrill Indonesia
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Agrawal Coal Company - India
- Eastern Energy - Thailand
- Aboitiz Power Corporation - Philippines
- Borneo Indobara - Indonesia
- Directorate Of Revenue Intelligence - India
- Mercuria Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Mercator Lines Limited - India
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Riau Bara Harum - Indonesia
- Kepco SPC Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Renaissance Capital - South Africa
- Malabar Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- CNBM International Corporation - China
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- McConnell Dowell - Australia
- Mjunction Services Limited - India
- Holcim Trading Pte Ltd - Singapore
- TeaM Sual Corporation - Philippines
- Deloitte Consulting - India
- Attock Cement Pakistan Limited
- Tata Chemicals Ltd - India
- Planning Commission, India
- Kaltim Prima Coal - Indonesia
- European Bulk Services B.V. - Netherlands
- Pendopo Energi Batubara - Indonesia
- GMR Energy Limited - India
- White Energy Company Limited
- Tamil Nadu electricity Board
- Kideco Jaya Agung - Indonesia
- Sree Jayajothi Cements Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- SN Aboitiz Power Inc, Philippines
- Bangladesh Power Developement Board
- Energy Link Ltd, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Rashtriya Ispat Nigam Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- New Zealand Coal & Carbon
- Heidelberg Cement - Germany
- Merrill Lynch Commodities Europe
- Miang Besar Coal Terminal - Indonesia
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Commonwealth Bank - Australia
- ICICI Bank Limited - India
- Globalindo Alam Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Cement Manufacturers Association - India
- Bayan Resources Tbk. - Indonesia
- Rio Tinto Coal - Australia
- Wilmar Investment Holdings
- Krishnapatnam Port Company Ltd. - India
- Orica Australia Pty. Ltd.
- IEA Clean Coal Centre - UK
- Port Waratah Coal Services - Australia
- India Bulls Power Limited - India
- Indonesian Coal Mining Association
- Dalmia Cement Bharat India
- Ind-Barath Power Infra Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Maharashtra Electricity Regulatory Commission - India
- Uttam Galva Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- CIMB Investment Bank - Malaysia
- Gujarat Sidhee Cement - India
- Bharathi Cement Corporation - India
- Grasim Industreis Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- Sarangani Energy Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Finance - Indonesia
- Minerals Council of Australia
- The University of Queensland
- Kartika Selabumi Mining - Indonesia
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- Indian Oil Corporation Limited
- Karbindo Abesyapradhi - Indoneisa
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Baramulti Group, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IHS Mccloskey Coal Group - USA
- The Treasury - Australian Government
- Petron Corporation, Philippines
- Africa Commodities Group - South Africa
- Marubeni Corporation - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Banpu Public Company Limited - Thailand
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- Vizag Seaport Private Limited - India
- Jindal Steel & Power Ltd - India
- Australian Commodity Traders Exchange
- Aditya Birla Group - India
- Manunggal Multi Energi - Indonesia
- Eastern Coal Council - USA
- Essar Steel Hazira Ltd - India
- SMC Global Power, Philippines
- Meralco Power Generation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Star Paper Mills Limited - India
- Wood Mackenzie - Singapore
- The State Trading Corporation of India Ltd
- Ceylon Electricity Board - Sri Lanka
- Gujarat Electricity Regulatory Commission - India
- Indika Energy - Indonesia
- Larsen & Toubro Limited - India
- Economic Council, Georgia
- PNOC Exploration Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Sindya Power Generating Company Private Ltd
- Metalloyd Limited - United Kingdom
- Coalindo Energy - Indonesia
- Edison Trading Spa - Italy
- Energy Development Corp, Philippines
- South Luzon Thermal Energy Corporation
- Independent Power Producers Association of India
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Thai Mozambique Logistica
- Xindia Steels Limited - India
- Timah Investasi Mineral - Indoneisa
- Anglo American - United Kingdom
- Electricity Generating Authority of Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
- Coastal Gujarat Power Limited - India
- Interocean Group of Companies - India
- GN Power Mariveles Coal Plant, Philippines
- Bhoruka Overseas - Indonesia
- Madhucon Powers Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Carbofer General Trading SA - India
- Romanian Commodities Exchange
- Samtan Co., Ltd - South Korea
- Orica Mining Services - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Lanco Infratech Ltd - India
- Sical Logistics Limited - India
- Oldendorff Carriers - Singapore
- Meenaskhi Energy Private Limited - India
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- Goldman Sachs - Singapore
- Ambuja Cements Ltd - India
- Indogreen Group - Indonesia
- ASAPP Information Group - India
- SMG Consultants - Indonesia
- Jaiprakash Power Ventures ltd
- London Commodity Brokers - England
- Medco Energi Mining Internasional
- Alfred C Toepfer International GmbH - Germany
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