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