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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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Friday, 21 March 14
MERCURIA ANNOUNCES ACQUISITION OF J.P. MORGAN PHYSICAL COMMODITIES BUSINESS
COALspot.com: Mercuria Energy Group announced that it has reached a definitive agreement with J.P. Morgan Chase & Co. to acquire its physica ...
Thursday, 20 March 14
CAPESIZE: WEST AUSTRALIA TO CHINA RATES HAVE CLIMBED BACK TOWARD USD 11 PMT - FEARNRESEARCH
Handy
From a slight improvement in the Atlantic to a more mixed picture this mid week. North Atlantic rounds showing softening signs whereas S ...
Wednesday, 19 March 14
INSTEAD OF DECIDING WHETHER THE GLASS IS HALF FULL OR HALF EMPTY, I AM CURRENTLY GLAD THERE IS WATER IN THE GLASS - EVA TZIMA
By Eva Tzima
Research Analyst
Intermodal Research & Valuations
Right when you think that you have all your facts straight, right wh ...
Wednesday, 19 March 14
EUROCOKE SUMMIT 2014
Press Release: ThyssenKrupp, Steel Institute VDEh, SSI and more headline Smithers Apex’s Eurocoke Summit
The leading coke, coal and s ...
Wednesday, 19 March 14
DRY BULK MARKET REBOUND LEADS TO MORE NEWBUILDING ORDERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The steady rise of the dry bulk market, as evidenced by the return, yesterday, of the Baltic Dry Index above the 1,500-point mark (1,518), is fu ...
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- Semirara Mining Corp, Philippines
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- LBH Netherlands Bv - Netherlands
- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
- Indonesian Coal Mining Association
- Jindal Steel & Power Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Pendopo Energi Batubara - Indonesia
- Thiess Contractors Indonesia
- Formosa Plastics Group - Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Agrawal Coal Company - India
- Jaiprakash Power Ventures ltd
- TNB Fuel Sdn Bhd - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- ASAPP Information Group - India
- Gujarat Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Siam City Cement PLC, Thailand
- Ministry of Finance - Indonesia
- Indogreen Group - Indonesia
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Parliament of New Zealand
- Meralco Power Generation, Philippines
- Orica Mining Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- SMC Global Power, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- India Bulls Power Limited - India
- Uttam Galva Steels Limited - India
- Star Paper Mills Limited - India
- The Treasury - Australian Government
- White Energy Company Limited
- Mintek Dendrill Indonesia
- Directorate Of Revenue Intelligence - India
- Bahari Cakrawala Sebuku - Indonesia
- Romanian Commodities Exchange
- Power Finance Corporation Ltd., India
- Timah Investasi Mineral - Indoneisa
- Energy Development Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Transport, Egypt
- Indian Energy Exchange, India
- Sree Jayajothi Cements Limited - India
- Grasim Industreis Ltd - India
- Vedanta Resources Plc - India
- Bayan Resources Tbk. - Indonesia
- Wood Mackenzie - Singapore
- Directorate General of MIneral and Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Bhushan Steel Limited - India
- Miang Besar Coal Terminal - Indonesia
- Malabar Cements Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Bukit Baiduri Energy - Indonesia
- Marubeni Corporation - India
- GMR Energy Limited - India
- Ceylon Electricity Board - Sri Lanka
- Barasentosa Lestari - Indonesia
- Indika Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Meenaskhi Energy Private Limited - India
- PowerSource Philippines DevCo
- Holcim Trading Pte Ltd - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Tata Chemicals Ltd - India
- Edison Trading Spa - Italy
- Price Waterhouse Coopers - Russia
- Sojitz Corporation - Japan
- Dalmia Cement Bharat India
- AsiaOL BioFuels Corp., Philippines
- Maharashtra Electricity Regulatory Commission - India
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- Eastern Coal Council - USA
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- Interocean Group of Companies - India
- TeaM Sual Corporation - Philippines
- Siam City Cement - Thailand
- Bharathi Cement Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- Planning Commission, India
- Merrill Lynch Commodities Europe
- Bangladesh Power Developement Board
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- IHS Mccloskey Coal Group - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Australian Coal Association
- Cigading International Bulk Terminal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Electricity Authority, New Zealand
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- MS Steel International - UAE
- Minerals Council of Australia
- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Chamber of Mines of South Africa
- GN Power Mariveles Coal Plant, Philippines
- Vizag Seaport Private Limited - India
- Eastern Energy - Thailand
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Kepco SPC Power Corporation, Philippines
- Tamil Nadu electricity Board
- Mjunction Services Limited - India
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kumho Petrochemical, South Korea
- Sical Logistics Limited - India
- Bukit Makmur.PT - Indonesia
- Essar Steel Hazira Ltd - India
- Mercator Lines Limited - India
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- Asmin Koalindo Tuhup - Indonesia
- Orica Australia Pty. Ltd.
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Posco Energy - South Korea
- Renaissance Capital - South Africa
- Latin American Coal - Colombia
- Heidelberg Cement - Germany
- Goldman Sachs - Singapore
- Mercuria Energy - Indonesia
- Economic Council, Georgia
- Sakthi Sugars Limited - India
- The State Trading Corporation of India Ltd
- Carbofer General Trading SA - India
- Kartika Selabumi Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Antam Resourcindo - Indonesia
- Parry Sugars Refinery, India
- Larsen & Toubro Limited - India
- Central Java Power - Indonesia
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- PTC India Limited - India
- Makarim & Taira - Indonesia
- Krishnapatnam Port Company Ltd. - India
- IEA Clean Coal Centre - UK
- Port Waratah Coal Services - Australia
- Maheswari Brothers Coal Limited - India
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- Salva Resources Pvt Ltd - India
- Trasteel International SA, Italy
- The University of Queensland
- London Commodity Brokers - England
- New Zealand Coal & Carbon
- Globalindo Alam Lestari - Indonesia
- PNOC Exploration Corporation - Philippines
- Global Business Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Borneo Indobara - Indonesia
- Banpu Public Company Limited - Thailand
- Kaltim Prima Coal - Indonesia
- Videocon Industries ltd - India
- Bhatia International Limited - India
- Ambuja Cements Ltd - India
- Coastal Gujarat Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Lanco Infratech Ltd - India
- McConnell Dowell - Australia
- Aboitiz Power Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Madhucon Powers Ltd - India
- Central Electricity Authority - India
- OPG Power Generation Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
- Commonwealth Bank - Australia
- Petron Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Wilmar Investment Holdings
- Kideco Jaya Agung - Indonesia
- Thai Mozambique Logistica
- Indo Tambangraya Megah - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Ministry of Mines - Canada
- GAC Shipping (India) Pvt Ltd
- Leighton Contractors Pty Ltd - Australia
- Rio Tinto Coal - Australia
- Coalindo Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Metalloyd Limited - United Kingdom
- Alfred C Toepfer International GmbH - Germany
- San Jose City I Power Corp, Philippines
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