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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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- Iligan Light & Power Inc, Philippines
- Port Waratah Coal Services - Australia
- Anglo American - United Kingdom
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Goldman Sachs - Singapore
- Rio Tinto Coal - Australia
- OPG Power Generation Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- Timah Investasi Mineral - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- South Luzon Thermal Energy Corporation
- Miang Besar Coal Terminal - Indonesia
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sical Logistics Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bhushan Steel Limited - India
- Ind-Barath Power Infra Limited - India
- Wood Mackenzie - Singapore
- Gujarat Electricity Regulatory Commission - India
- Chamber of Mines of South Africa
- Karaikal Port Pvt Ltd - India
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- IHS Mccloskey Coal Group - USA
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- Orica Australia Pty. Ltd.
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- PetroVietnam Power Coal Import and Supply Company
- Gujarat Mineral Development Corp Ltd - India
- Mintek Dendrill Indonesia
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- Kideco Jaya Agung - Indonesia
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- Bangladesh Power Developement Board
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- The State Trading Corporation of India Ltd
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- Sarangani Energy Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- PTC India Limited - India
- The Treasury - Australian Government
- Kalimantan Lumbung Energi - Indonesia
- Carbofer General Trading SA - India
- Tata Chemicals Ltd - India
- ASAPP Information Group - India
- Electricity Generating Authority of Thailand
- Xindia Steels Limited - India
- Samtan Co., Ltd - South Korea
- The University of Queensland
- Videocon Industries ltd - India
- Bhatia International Limited - India
- Baramulti Group, Indonesia
- SMC Global Power, Philippines
- Salva Resources Pvt Ltd - India
- Australian Commodity Traders Exchange
- European Bulk Services B.V. - Netherlands
- Therma Luzon, Inc, Philippines
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- Makarim & Taira - Indonesia
- Mjunction Services Limited - India
- Bayan Resources Tbk. - Indonesia
- GAC Shipping (India) Pvt Ltd
- GN Power Mariveles Coal Plant, Philippines
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Sakthi Sugars Limited - India
- Krishnapatnam Port Company Ltd. - India
- GMR Energy Limited - India
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- Riau Bara Harum - Indonesia
- Thai Mozambique Logistica
- Uttam Galva Steels Limited - India
- Edison Trading Spa - Italy
- Gujarat Sidhee Cement - India
- Cigading International Bulk Terminal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- Eastern Coal Council - USA
- Central Java Power - Indonesia
- Interocean Group of Companies - India
- Leighton Contractors Pty Ltd - Australia
- Electricity Authority, New Zealand
- ICICI Bank Limited - India
- PNOC Exploration Corporation - Philippines
- Indika Energy - Indonesia
- Wilmar Investment Holdings
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- Neyveli Lignite Corporation Ltd, - India
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- Deloitte Consulting - India
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- Ministry of Finance - Indonesia
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Semirara Mining and Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- Commonwealth Bank - Australia
- Formosa Plastics Group - Taiwan
- Agrawal Coal Company - India
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Simpson Spence & Young - Indonesia
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- Minerals Council of Australia
- Directorate Of Revenue Intelligence - India
- Oldendorff Carriers - Singapore
- Energy Link Ltd, New Zealand
- Altura Mining Limited, Indonesia
- Independent Power Producers Association of India
- CNBM International Corporation - China
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- Parliament of New Zealand
- SN Aboitiz Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Standard Chartered Bank - UAE
- Cement Manufacturers Association - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Siam City Cement PLC, Thailand
- Economic Council, Georgia
- Orica Mining Services - Indonesia
- Aditya Birla Group - India
- Ambuja Cements Ltd - India
- MS Steel International - UAE
- Energy Development Corp, Philippines
- London Commodity Brokers - England
- Kepco SPC Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- Renaissance Capital - South Africa
- Posco Energy - South Korea
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- Eastern Energy - Thailand
- Manunggal Multi Energi - Indonesia
- Georgia Ports Authority, United States
- Trasteel International SA, Italy
- Toyota Tsusho Corporation, Japan
- Savvy Resources Ltd - HongKong
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Larsen & Toubro Limited - India
- VISA Power Limited - India
- Grasim Industreis Ltd - India
- McConnell Dowell - Australia
- Heidelberg Cement - Germany
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- IEA Clean Coal Centre - UK
- Lanco Infratech Ltd - India
- Romanian Commodities Exchange
- Billiton Holdings Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Singapore Mercantile Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Transport, Egypt
- Bulk Trading Sa - Switzerland
- Banpu Public Company Limited - Thailand
- Mercator Lines Limited - India
- Parry Sugars Refinery, India
- Coalindo Energy - Indonesia
- Kaltim Prima Coal - Indonesia
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- Bank of Tokyo Mitsubishi UFJ Ltd
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- Rashtriya Ispat Nigam Limited - India
- PowerSource Philippines DevCo
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- Attock Cement Pakistan Limited
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