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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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Tuesday, 18 March 14
SECOND QUARTER SUB-BIT FOB INDONESIA COAL SWAP LOST 3.27% IN A MONTH
COALspot.com – Indonesia, the world’s largest exporter of the thermal coal's swaps for delivery April - June 2014 gained this pa ...
Tuesday, 18 March 14
NEWCASTLE COAL EXPORT VOLUME FALLS 26.23% WEEK ON WEEK
COALspot.com: In the week ended 17 March 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 2 ...
Monday, 17 March 14
API 8 CFR SOUTH CHINA COAL SWAPS FOR AVERAGE Q2 14 DELIVERIES LOST 2.59% M-O-M
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 2.59 percent month on month and closed at US$ 74.15 per mt as o ...
Sunday, 16 March 14
BDI DOWN ON LOW CAPESIZE ACTIVITY
COALspot.com: The freight market was slightly soft this week with BDI down by 4.28 pct week on week. The BDI closed at 1,477 points and the cape ...
Friday, 14 March 14
DRY BULK MARKET ENTERS RECOVERY MODE, ON INCREASED CAPESIZE DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has entered and sustained higher ground as of this week, on the back on increased Capesize demand. Although the situation in ...
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- IEA Clean Coal Centre - UK
- Kepco SPC Power Corporation, Philippines
- Parry Sugars Refinery, India
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Jindal Steel & Power Ltd - India
- Mercuria Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Videocon Industries ltd - India
- OPG Power Generation Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- Ambuja Cements Ltd - India
- Baramulti Group, Indonesia
- Coastal Gujarat Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Finance - Indonesia
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Bhushan Steel Limited - India
- Indika Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- VISA Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Orica Australia Pty. Ltd.
- Kohat Cement Company Ltd. - Pakistan
- Deloitte Consulting - India
- Indian Energy Exchange, India
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Iligan Light & Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Malabar Cements Ltd - India
- Petron Corporation, Philippines
- Sical Logistics Limited - India
- Makarim & Taira - Indonesia
- Thai Mozambique Logistica
- McConnell Dowell - Australia
- Indonesian Coal Mining Association
- Bukit Baiduri Energy - Indonesia
- Sakthi Sugars Limited - India
- Bhoruka Overseas - Indonesia
- Dalmia Cement Bharat India
- Global Business Power Corporation, Philippines
- Commonwealth Bank - Australia
- Larsen & Toubro Limited - India
- Lanco Infratech Ltd - India
- Grasim Industreis Ltd - India
- Therma Luzon, Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- Antam Resourcindo - Indonesia
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- Thiess Contractors Indonesia
- TeaM Sual Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- Standard Chartered Bank - UAE
- Sojitz Corporation - Japan
- Jorong Barutama Greston.PT - Indonesia
- Tata Chemicals Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Bhatia International Limited - India
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Indo Tambangraya Megah - Indonesia
- Electricity Authority, New Zealand
- Bukit Makmur.PT - Indonesia
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Minerals Council of Australia
- Heidelberg Cement - Germany
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Trasteel International SA, Italy
- Power Finance Corporation Ltd., India
- Maharashtra Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- GAC Shipping (India) Pvt Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Billiton Holdings Pty Ltd - Australia
- Chamber of Mines of South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vedanta Resources Plc - India
- Renaissance Capital - South Africa
- Oldendorff Carriers - Singapore
- Cigading International Bulk Terminal - Indonesia
- Agrawal Coal Company - India
- Salva Resources Pvt Ltd - India
- Aditya Birla Group - India
- LBH Netherlands Bv - Netherlands
- Offshore Bulk Terminal Pte Ltd, Singapore
- Interocean Group of Companies - India
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bharathi Cement Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- ICICI Bank Limited - India
- Simpson Spence & Young - Indonesia
- Goldman Sachs - Singapore
- Bangladesh Power Developement Board
- Wilmar Investment Holdings
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Timah Investasi Mineral - Indoneisa
- Siam City Cement - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GVK Power & Infra Limited - India
- Vizag Seaport Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- Leighton Contractors Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- CIMB Investment Bank - Malaysia
- Globalindo Alam Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- San Jose City I Power Corp, Philippines
- Star Paper Mills Limited - India
- Australian Coal Association
- Cement Manufacturers Association - India
- Planning Commission, India
- Carbofer General Trading SA - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Independent Power Producers Association of India
- MS Steel International - UAE
- The State Trading Corporation of India Ltd
- Wood Mackenzie - Singapore
- Bulk Trading Sa - Switzerland
- Georgia Ports Authority, United States
- ASAPP Information Group - India
- Parliament of New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Posco Energy - South Korea
- Singapore Mercantile Exchange
- Global Green Power PLC Corporation, Philippines
- Ministry of Mines - Canada
- Meenaskhi Energy Private Limited - India
- Price Waterhouse Coopers - Russia
- GMR Energy Limited - India
- Electricity Generating Authority of Thailand
- Attock Cement Pakistan Limited
- Semirara Mining Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Sarangani Energy Corporation, Philippines
- Rio Tinto Coal - Australia
- Gujarat Mineral Development Corp Ltd - India
- Intertek Mineral Services - Indonesia
- South Luzon Thermal Energy Corporation
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- The University of Queensland
- Kumho Petrochemical, South Korea
- Anglo American - United Kingdom
- SMG Consultants - Indonesia
- Mercator Lines Limited - India
- Barasentosa Lestari - Indonesia
- PTC India Limited - India
- Edison Trading Spa - Italy
- Directorate Of Revenue Intelligence - India
- The Treasury - Australian Government
- Riau Bara Harum - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- Indogreen Group - Indonesia
- Binh Thuan Hamico - Vietnam
- Tamil Nadu electricity Board
- Miang Besar Coal Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Kobexindo Tractors - Indoneisa
- Coalindo Energy - Indonesia
- Marubeni Corporation - India
- Central Java Power - Indonesia
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- Port Waratah Coal Services - Australia
- Medco Energi Mining Internasional
- Toyota Tsusho Corporation, Japan
- Vijayanagar Sugar Pvt Ltd - India
- India Bulls Power Limited - India
- SMC Global Power, Philippines
- Latin American Coal - Colombia
- PNOC Exploration Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Gujarat Sidhee Cement - India
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- Siam City Cement PLC, Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- Orica Mining Services - Indonesia
- Eastern Coal Council - USA
- Sinarmas Energy and Mining - Indonesia
- Economic Council, Georgia
- GN Power Mariveles Coal Plant, Philippines
- Energy Link Ltd, New Zealand
- Sree Jayajothi Cements Limited - India
- Merrill Lynch Commodities Europe
- Manunggal Multi Energi - Indonesia
- Straits Asia Resources Limited - Singapore
- New Zealand Coal & Carbon
- Pendopo Energi Batubara - Indonesia
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