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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, 24 March 14
SGX'S Q2'14 CFR SOUTH CHINA COAL SWAP CLOSES SLIGHTLY HIGHER W-O-W
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 1.81 percent month on month and closed at US$ 74.82 per mt as o ...
Sunday, 23 March 14
THE COAL FREIGHT RATES SEEN SLIGHTLY FIRMING UP THIS WEEK - REDDY
COALspot.com: The freight market firmed up this week. BDI was up 8.26 pct week on week and index was closed at 1599 points. The Cape index was u ...
Saturday, 22 March 14
SHIP OWNERS INVEST $15 BILLION FOR NEWBUILDINGS AND SECONDHAND VESSELS DURING FEBRUARY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Ship owners have kept on their aggressive stance in the investment scene both for newbuildings, as well as for secondhand vessels globally durin ...
Friday, 21 March 14
DRY BULK MARKET STAYS ON RECOVERY MODE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has reached new year heighs, as a result of renewed Capesize demand. The Baltic Dry Index (BDI) ended yesterday's sessio ...
Friday, 21 March 14
US COAL PRODUCTION UP 1.5%; WEST MISSISSIPPI COAL PRODUCTION DOWN 1.85% WEEK ON WEEK
COALspot.com – United States the world's second largest coal producer, produced approximately 19.0 million short tons (mmst) of coal i ...
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- Madhucon Powers Ltd - India
- Minerals Council of Australia
- Miang Besar Coal Terminal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Agrawal Coal Company - India
- Pendopo Energi Batubara - Indonesia
- Videocon Industries ltd - India
- Cement Manufacturers Association - India
- Electricity Authority, New Zealand
- Meenaskhi Energy Private Limited - India
- Straits Asia Resources Limited - Singapore
- LBH Netherlands Bv - Netherlands
- Bhoruka Overseas - Indonesia
- Ministry of Transport, Egypt
- Orica Australia Pty. Ltd.
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- McConnell Dowell - Australia
- Petron Corporation, Philippines
- Samtan Co., Ltd - South Korea
- AsiaOL BioFuels Corp., Philippines
- Simpson Spence & Young - Indonesia
- Indonesian Coal Mining Association
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- Kumho Petrochemical, South Korea
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- Port Waratah Coal Services - Australia
- Ambuja Cements Ltd - India
- Star Paper Mills Limited - India
- Rio Tinto Coal - Australia
- Medco Energi Mining Internasional
- Vedanta Resources Plc - India
- Indogreen Group - Indonesia
- Directorate Of Revenue Intelligence - India
- MS Steel International - UAE
- Coastal Gujarat Power Limited - India
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- Tamil Nadu electricity Board
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Makarim & Taira - Indonesia
- Larsen & Toubro Limited - India
- Dalmia Cement Bharat India
- Wilmar Investment Holdings
- Toyota Tsusho Corporation, Japan
- Borneo Indobara - Indonesia
- Mercuria Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Salva Resources Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The University of Queensland
- New Zealand Coal & Carbon
- South Luzon Thermal Energy Corporation
- Thai Mozambique Logistica
- Eastern Energy - Thailand
- Kartika Selabumi Mining - Indonesia
- Therma Luzon, Inc, Philippines
- Baramulti Group, Indonesia
- Jaiprakash Power Ventures ltd
- Bharathi Cement Corporation - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Essar Steel Hazira Ltd - India
- Coalindo Energy - Indonesia
- PowerSource Philippines DevCo
- Indian Oil Corporation Limited
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- CIMB Investment Bank - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Ministry of Mines - Canada
- Siam City Cement - Thailand
- Chettinad Cement Corporation Ltd - India
- Goldman Sachs - Singapore
- PNOC Exploration Corporation - Philippines
- Indian Energy Exchange, India
- Riau Bara Harum - Indonesia
- Aditya Birla Group - India
- Bhatia International Limited - India
- San Jose City I Power Corp, Philippines
- Romanian Commodities Exchange
- Gujarat Sidhee Cement - India
- Global Business Power Corporation, Philippines
- Planning Commission, India
- Parliament of New Zealand
- Economic Council, Georgia
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Deloitte Consulting - India
- Wood Mackenzie - Singapore
- Sakthi Sugars Limited - India
- Maheswari Brothers Coal Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- The State Trading Corporation of India Ltd
- Manunggal Multi Energi - Indonesia
- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Krishnapatnam Port Company Ltd. - India
- Chamber of Mines of South Africa
- Sarangani Energy Corporation, Philippines
- Merrill Lynch Commodities Europe
- Mercator Lines Limited - India
- Siam City Cement PLC, Thailand
- Alfred C Toepfer International GmbH - Germany
- Bukit Makmur.PT - Indonesia
- SN Aboitiz Power Inc, Philippines
- Standard Chartered Bank - UAE
- GMR Energy Limited - India
- Australian Coal Association
- Rashtriya Ispat Nigam Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Energy Development Corp, Philippines
- Renaissance Capital - South Africa
- Leighton Contractors Pty Ltd - Australia
- Bulk Trading Sa - Switzerland
- Uttam Galva Steels Limited - India
- Georgia Ports Authority, United States
- Asia Pacific Energy Resources Ventures Inc, Philippines
- VISA Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Edison Trading Spa - Italy
- Electricity Generating Authority of Thailand
- TeaM Sual Corporation - Philippines
- Commonwealth Bank - Australia
- Malabar Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- Directorate General of MIneral and Coal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Sical Logistics Limited - India
- Thiess Contractors Indonesia
- Iligan Light & Power Inc, Philippines
- SMG Consultants - Indonesia
- Karaikal Port Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Carbofer General Trading SA - India
- Lanco Infratech Ltd - India
- PTC India Limited - India
- SMC Global Power, Philippines
- The Treasury - Australian Government
- Kobexindo Tractors - Indoneisa
- Sree Jayajothi Cements Limited - India
- Central Electricity Authority - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Power Finance Corporation Ltd., India
- Timah Investasi Mineral - Indoneisa
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- Oldendorff Carriers - Singapore
- GVK Power & Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Marubeni Corporation - India
- Globalindo Alam Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Semirara Mining and Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Xindia Steels Limited - India
- Banpu Public Company Limited - Thailand
- International Coal Ventures Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jorong Barutama Greston.PT - Indonesia
- Anglo American - United Kingdom
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- European Bulk Services B.V. - Netherlands
- Latin American Coal - Colombia
- Indika Energy - Indonesia
- Singapore Mercantile Exchange
- Antam Resourcindo - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Tata Chemicals Ltd - India
- Kideco Jaya Agung - Indonesia
- Australian Commodity Traders Exchange
- Gujarat Mineral Development Corp Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Parry Sugars Refinery, India
- Sinarmas Energy and Mining - Indonesia
- Sojitz Corporation - Japan
- Bangladesh Power Developement Board
- Petrochimia International Co. Ltd.- Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- GAC Shipping (India) Pvt Ltd
- Maharashtra Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- Posco Energy - South Korea
- Eastern Coal Council - USA
- CNBM International Corporation - China
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- Central Java Power - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Orica Mining Services - Indonesia
- Attock Cement Pakistan Limited
- ICICI Bank Limited - India
- Formosa Plastics Group - Taiwan
- Vizag Seaport Private Limited - India
- Ceylon Electricity Board - Sri Lanka
- Grasim Industreis Ltd - India
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