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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, 07 March 14
INDONESIA TO PRODUCE 421 MMT OF COAL IN 2014
Coalspot.com: Indonesia finally agreed to increased 2014 coal output by as much as 6 percent to 421 million metric tons from its previous plan, a se ...
Friday, 07 March 14
US PRODUCED 19.4 MMST OF COAL IN PAST 7 DAYS, SAYS EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.4 million short tons (mmst) of coal in ...
Thursday, 06 March 14
PANAMAX MARKET IS STRUGGLING IN BOTH HEMISPHERES - FEARNRESEARCH
Handy
The Handy/Supra market experienced a rate increase in the Pacific. The activity itself is not too big, but spot tonnage is clearing up and ow ...
Wednesday, 05 March 14
THE BIG BULKERS HAVE IN FACT WITNESSED SIGNIFICANT IMPROVEMENTS IN BOTH BASINS
The BDI continues to gain back some of the lost ground, although in reality there isn't a lot to celebrate abou ...
Wednesday, 05 March 14
LEAVE IT TO CAPES TO CHANGE THE DIRECTION OF THE DRY BULK MARKET - INTERMODAL
Chartering (Wet: Stable- / Dry: Stable+)
Leave it to Capes to change the direction of the Dry Bulk market. The big bulkers managed to drag the BDI ...
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- Binh Thuan Hamico - Vietnam
- Manunggal Multi Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMC Global Power, Philippines
- PowerSource Philippines DevCo
- Gujarat Mineral Development Corp Ltd - India
- San Jose City I Power Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Georgia Ports Authority, United States
- Videocon Industries ltd - India
- Sinarmas Energy and Mining - Indonesia
- Oldendorff Carriers - Singapore
- Meralco Power Generation, Philippines
- Baramulti Group, Indonesia
- Kartika Selabumi Mining - Indonesia
- Tamil Nadu electricity Board
- Iligan Light & Power Inc, Philippines
- Thai Mozambique Logistica
- Wilmar Investment Holdings
- Australian Commodity Traders Exchange
- VISA Power Limited - India
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Bayan Resources Tbk. - Indonesia
- Sarangani Energy Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Bharathi Cement Corporation - India
- OPG Power Generation Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Bhoruka Overseas - Indonesia
- Heidelberg Cement - Germany
- Eastern Energy - Thailand
- Pendopo Energi Batubara - Indonesia
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ASAPP Information Group - India
- Makarim & Taira - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karbindo Abesyapradhi - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Bulk Trading Sa - Switzerland
- Commonwealth Bank - Australia
- Sakthi Sugars Limited - India
- Mintek Dendrill Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Xindia Steels Limited - India
- Anglo American - United Kingdom
- Metalloyd Limited - United Kingdom
- Central Java Power - Indonesia
- Barasentosa Lestari - Indonesia
- Eastern Coal Council - USA
- Marubeni Corporation - India
- White Energy Company Limited
- Cigading International Bulk Terminal - Indonesia
- GVK Power & Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Global Coal Blending Company Limited - Australia
- Dalmia Cement Bharat India
- Samtan Co., Ltd - South Korea
- Neyveli Lignite Corporation Ltd, - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Port Waratah Coal Services - Australia
- Indika Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- CNBM International Corporation - China
- Aditya Birla Group - India
- Uttam Galva Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Vizag Seaport Private Limited - India
- Minerals Council of Australia
- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- Latin American Coal - Colombia
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- Bangladesh Power Developement Board
- Kohat Cement Company Ltd. - Pakistan
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Bukit Baiduri Energy - Indonesia
- McConnell Dowell - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Orica Australia Pty. Ltd.
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- Indian Energy Exchange, India
- GAC Shipping (India) Pvt Ltd
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Directorate Of Revenue Intelligence - India
- CIMB Investment Bank - Malaysia
- Independent Power Producers Association of India
- Savvy Resources Ltd - HongKong
- Jindal Steel & Power Ltd - India
- Interocean Group of Companies - India
- Billiton Holdings Pty Ltd - Australia
- Holcim Trading Pte Ltd - Singapore
- AsiaOL BioFuels Corp., Philippines
- Planning Commission, India
- Standard Chartered Bank - UAE
- TeaM Sual Corporation - Philippines
- London Commodity Brokers - England
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Riau Bara Harum - Indonesia
- Coastal Gujarat Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- India Bulls Power Limited - India
- Economic Council, Georgia
- Renaissance Capital - South Africa
- ICICI Bank Limited - India
- Medco Energi Mining Internasional
- Asmin Koalindo Tuhup - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- Jaiprakash Power Ventures ltd
- Merrill Lynch Commodities Europe
- Electricity Authority, New Zealand
- Malabar Cements Ltd - India
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- SMG Consultants - Indonesia
- Timah Investasi Mineral - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining Corp, Philippines
- Cement Manufacturers Association - India
- Formosa Plastics Group - Taiwan
- Petron Corporation, Philippines
- Parry Sugars Refinery, India
- Jorong Barutama Greston.PT - Indonesia
- IEA Clean Coal Centre - UK
- PTC India Limited - India
- Africa Commodities Group - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Mercator Lines Limited - India
- Toyota Tsusho Corporation, Japan
- Ceylon Electricity Board - Sri Lanka
- Star Paper Mills Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- The Treasury - Australian Government
- South Luzon Thermal Energy Corporation
- Coalindo Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- New Zealand Coal & Carbon
- Ministry of Transport, Egypt
- Semirara Mining and Power Corporation, Philippines
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- Simpson Spence & Young - Indonesia
- Coal and Oil Company - UAE
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Sree Jayajothi Cements Limited - India
- Parliament of New Zealand
- Agrawal Coal Company - India
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Ministry of Mines - Canada
- LBH Netherlands Bv - Netherlands
- Ministry of Finance - Indonesia
- Goldman Sachs - Singapore
- Indonesian Coal Mining Association
- Globalindo Alam Lestari - Indonesia
- Meenaskhi Energy Private Limited - India
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- Tata Chemicals Ltd - India
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Kobexindo Tractors - Indoneisa
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Bhushan Steel Limited - India
- Madhucon Powers Ltd - India
- Electricity Generating Authority of Thailand
- Grasim Industreis Ltd - India
- Romanian Commodities Exchange
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Siam City Cement - Thailand
- Intertek Mineral Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Larsen & Toubro Limited - India
- Altura Mining Limited, Indonesia
- Antam Resourcindo - Indonesia
- Edison Trading Spa - Italy
- The State Trading Corporation of India Ltd
- Lanco Infratech Ltd - India
- Mercuria Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Salva Resources Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Ambuja Cements Ltd - India
- Rio Tinto Coal - Australia
- Posco Energy - South Korea
- Orica Mining Services - Indonesia
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