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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, 04 March 14
AUSTRALIA'S NPC TO SHIP 11.85 MMT OF COAL IN MARCH
COALspot.com: In the week ended 3 March 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 3.15 m ...
Tuesday, 04 March 14
HIGHER PRICES AND STEADY FREIGHT RATES LEAD SHIP OWNERS TO TEMPORARILY HALT SECOND HAND VESSEL PURCHASES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
As the dry bulk market has kept on improving, but at a very slow rate, ship owners have elected to take a step back from the flurry of the S&P m ...
Monday, 03 March 14
SUB-BIT INDONESIA COAL SWAP (FOB) FOR AVERAGE Q115 CLOSED AT $60.28, $ 1.70 HIGHER THAN 2Q14
COALspot.com – Indonesia, the world’s largest exporter of the thermal coal's swaps for delivery April - June 2014 slightly corrected do ...
Monday, 03 March 14
API 8 CFR SOUTH CHINA SWAPS: Q4' 2014 DELIVERY CLOSED US$ 1.40 HIGHER COMPARED TO Q2' 2014 DELIVERY
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 1.90 percent month on month and closed at US$ 76.27 per mt as on Fr ...
Monday, 03 March 14
COSTS LIABILITY PASSING DOWN A CHARTERPARTY CHAIN - SKULD
KNOWLEDGE TO ELEVATE
Provided that charterparties are on back to back terms, and the claim is successful, liability for costs incurred shoul ...
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- Edison Trading Spa - Italy
- Posco Energy - South Korea
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Savvy Resources Ltd - HongKong
- Malabar Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Coastal Gujarat Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Salva Resources Pvt Ltd - India
- Petron Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- Semirara Mining Corp, Philippines
- Coalindo Energy - Indonesia
- Orica Mining Services - Indonesia
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- Cement Manufacturers Association - India
- Pendopo Energi Batubara - Indonesia
- Mintek Dendrill Indonesia
- Kaltim Prima Coal - Indonesia
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Kumho Petrochemical, South Korea
- Bukit Baiduri Energy - Indonesia
- Singapore Mercantile Exchange
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Grasim Industreis Ltd - India
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- TeaM Sual Corporation - Philippines
- New Zealand Coal & Carbon
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Price Waterhouse Coopers - Russia
- Metalloyd Limited - United Kingdom
- Eastern Coal Council - USA
- Bayan Resources Tbk. - Indonesia
- Bukit Makmur.PT - Indonesia
- Bulk Trading Sa - Switzerland
- Parliament of New Zealand
- Kalimantan Lumbung Energi - Indonesia
- LBH Netherlands Bv - Netherlands
- Indika Energy - Indonesia
- Bhatia International Limited - India
- Maheswari Brothers Coal Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- European Bulk Services B.V. - Netherlands
- Siam City Cement PLC, Thailand
- Wilmar Investment Holdings
- Orica Australia Pty. Ltd.
- Manunggal Multi Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Jaiprakash Power Ventures ltd
- Aboitiz Power Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Holcim Trading Pte Ltd - Singapore
- Eastern Energy - Thailand
- CIMB Investment Bank - Malaysia
- Straits Asia Resources Limited - Singapore
- Economic Council, Georgia
- Semirara Mining and Power Corporation, Philippines
- MS Steel International - UAE
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- Bhushan Steel Limited - India
- Makarim & Taira - Indonesia
- Riau Bara Harum - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Attock Cement Pakistan Limited
- Global Coal Blending Company Limited - Australia
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- GN Power Mariveles Coal Plant, Philippines
- Interocean Group of Companies - India
- International Coal Ventures Pvt Ltd - India
- Planning Commission, India
- Ceylon Electricity Board - Sri Lanka
- OPG Power Generation Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Romanian Commodities Exchange
- Timah Investasi Mineral - Indoneisa
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- London Commodity Brokers - England
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sojitz Corporation - Japan
- AsiaOL BioFuels Corp., Philippines
- Ministry of Transport, Egypt
- Videocon Industries ltd - India
- Neyveli Lignite Corporation Ltd, - India
- PowerSource Philippines DevCo
- Sakthi Sugars Limited - India
- Merrill Lynch Commodities Europe
- Gujarat Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- San Jose City I Power Corp, Philippines
- Barasentosa Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- Port Waratah Coal Services - Australia
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- ASAPP Information Group - India
- ICICI Bank Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Bangladesh Power Developement Board
- PTC India Limited - India
- Sical Logistics Limited - India
- India Bulls Power Limited - India
- Indogreen Group - Indonesia
- Borneo Indobara - Indonesia
- Tata Chemicals Ltd - India
- Siam City Cement - Thailand
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Coal and Oil Company - UAE
- Karbindo Abesyapradhi - Indoneisa
- Oldendorff Carriers - Singapore
- Energy Development Corp, Philippines
- Madhucon Powers Ltd - India
- Altura Mining Limited, Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Leighton Contractors Pty Ltd - Australia
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Sidhee Cement - India
- Australian Commodity Traders Exchange
- GVK Power & Infra Limited - India
- Independent Power Producers Association of India
- Medco Energi Mining Internasional
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Samtan Co., Ltd - South Korea
- GMR Energy Limited - India
- McConnell Dowell - Australia
- Rio Tinto Coal - Australia
- Mercator Lines Limited - India
- Jindal Steel & Power Ltd - India
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Parry Sugars Refinery, India
- Global Business Power Corporation, Philippines
- CNBM International Corporation - China
- Sindya Power Generating Company Private Ltd
- Chamber of Mines of South Africa
- GAC Shipping (India) Pvt Ltd
- Kartika Selabumi Mining - Indonesia
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- Maharashtra Electricity Regulatory Commission - India
- IEA Clean Coal Centre - UK
- Karaikal Port Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- The University of Queensland
- Carbofer General Trading SA - India
- Star Paper Mills Limited - India
- Heidelberg Cement - Germany
- Goldman Sachs - Singapore
- The Treasury - Australian Government
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Indonesian Coal Mining Association
- Cigading International Bulk Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Ambuja Cements Ltd - India
- PNOC Exploration Corporation - Philippines
- Indian Oil Corporation Limited
- Commonwealth Bank - Australia
- Essar Steel Hazira Ltd - India
- Standard Chartered Bank - UAE
- The State Trading Corporation of India Ltd
- Electricity Generating Authority of Thailand
- Toyota Tsusho Corporation, Japan
- Pipit Mutiara Jaya. PT, Indonesia
- Formosa Plastics Group - Taiwan
- Bukit Asam (Persero) Tbk - Indonesia
- Indo Tambangraya Megah - Indonesia
- Chettinad Cement Corporation Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Marubeni Corporation - India
- Meenaskhi Energy Private Limited - India
- Kobexindo Tractors - Indoneisa
- SMC Global Power, Philippines
- Central Java Power - Indonesia
- Tamil Nadu electricity Board
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Minerals Council of Australia
- Energy Link Ltd, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- Latin American Coal - Colombia
- Iligan Light & Power Inc, Philippines
- Ministry of Finance - Indonesia
- Miang Besar Coal Terminal - Indonesia
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