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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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Thursday, 27 February 14
SHIPPING LOANS WORTH $5 BILLION HAVE CHANGED HANDS OVER THE PAST YEAR, AS FUNDS INVEST IN SHIPPING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Funds investing in shipping has been the "talk of the town" over the past couple of years, as institutional investors, private equity and ...
Thursday, 27 February 14
NEWCASTLE COAL EXPORTS SLIP 26.68 PERCENT WEEK ON WEEK
COALspot.com: In the week ended 24 February 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 2. ...
Wednesday, 26 February 14
SMALLER SIZE SEGMENTS HOLDING ON TO THEIR LEVELS; CAPES CORRECTING UPWARDS - INTERMODAL
Chartering (Wet: Stable- / Dry: Stable+)
The Dry Bulk market continued to improve this past week, on the back of rates for the smaller size s ...
Tuesday, 25 February 14
GBCE, A COAL UPGRADING TECHNOLOGY DEVELOPER, APPOINTS RICHARD BULMAN AS PROJECT DIRECTOR
Press Release: GB Clean Energy Ltd. (GBCE) announced today the appointment of Richard Bulman as Project Director. In this capacity Mr. Bulman ...
Tuesday, 25 February 14
ULTRAMAXES ARE THE 'WEAPON OF CHOICE' FOR DRY BULK SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
It's been a busy start in 2014, as the first month of the year was a rather active in terms of second hand vessel purchases and newbuilding orderin ...
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- Agrawal Coal Company - India
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Tamil Nadu electricity Board
- Maharashtra Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Intertek Mineral Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Edison Trading Spa - Italy
- Semirara Mining Corp, Philippines
- VISA Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- Electricity Authority, New Zealand
- Renaissance Capital - South Africa
- Trasteel International SA, Italy
- Wood Mackenzie - Singapore
- Metalloyd Limited - United Kingdom
- Planning Commission, India
- Rashtriya Ispat Nigam Limited - India
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- International Coal Ventures Pvt Ltd - India
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- Georgia Ports Authority, United States
- Global Coal Blending Company Limited - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Bangladesh Power Developement Board
- Coal and Oil Company - UAE
- Sakthi Sugars Limited - India
- Ministry of Finance - Indonesia
- Meenaskhi Energy Private Limited - India
- Bukit Makmur.PT - Indonesia
- Grasim Industreis Ltd - India
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- Kumho Petrochemical, South Korea
- Holcim Trading Pte Ltd - Singapore
- Videocon Industries ltd - India
- Globalindo Alam Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- PowerSource Philippines DevCo
- Africa Commodities Group - South Africa
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Sojitz Corporation - Japan
- Krishnapatnam Port Company Ltd. - India
- Ambuja Cements Ltd - India
- Merrill Lynch Commodities Europe
- Thiess Contractors Indonesia
- Barasentosa Lestari - Indonesia
- Mintek Dendrill Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Oldendorff Carriers - Singapore
- Attock Cement Pakistan Limited
- Sarangani Energy Corporation, Philippines
- Indika Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- White Energy Company Limited
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Sidhee Cement - India
- Banpu Public Company Limited - Thailand
- CIMB Investment Bank - Malaysia
- Samtan Co., Ltd - South Korea
- Vedanta Resources Plc - India
- Bharathi Cement Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Posco Energy - South Korea
- Essar Steel Hazira Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Straits Asia Resources Limited - Singapore
- CNBM International Corporation - China
- Larsen & Toubro Limited - India
- McConnell Dowell - Australia
- PNOC Exploration Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Bhoruka Overseas - Indonesia
- Deloitte Consulting - India
- Sree Jayajothi Cements Limited - India
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Wilmar Investment Holdings
- Indian Energy Exchange, India
- Coalindo Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Indian Oil Corporation Limited
- Indogreen Group - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Antam Resourcindo - Indonesia
- Power Finance Corporation Ltd., India
- Bhatia International Limited - India
- Standard Chartered Bank - UAE
- Singapore Mercantile Exchange
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- London Commodity Brokers - England
- Therma Luzon, Inc, Philippines
- Ministry of Mines - Canada
- Petrochimia International Co. Ltd.- Taiwan
- Orica Australia Pty. Ltd.
- Central Java Power - Indonesia
- The Treasury - Australian Government
- Karaikal Port Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- Port Waratah Coal Services - Australia
- SMC Global Power, Philippines
- Mjunction Services Limited - India
- Vizag Seaport Private Limited - India
- Simpson Spence & Young - Indonesia
- LBH Netherlands Bv - Netherlands
- SMG Consultants - Indonesia
- Kobexindo Tractors - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Anglo American - United Kingdom
- Bhushan Steel Limited - India
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- South Luzon Thermal Energy Corporation
- Electricity Generating Authority of Thailand
- Minerals Council of Australia
- Gujarat Electricity Regulatory Commission - India
- Karbindo Abesyapradhi - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- Borneo Indobara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Latin American Coal - Colombia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kapuas Tunggal Persada - Indonesia
- GMR Energy Limited - India
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Dalmia Cement Bharat India
- Formosa Plastics Group - Taiwan
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- Aditya Birla Group - India
- SN Aboitiz Power Inc, Philippines
- Aboitiz Power Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- Baramulti Group, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Meralco Power Generation, Philippines
- Riau Bara Harum - Indonesia
- Star Paper Mills Limited - India
- Kepco SPC Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Malabar Cements Ltd - India
- PTC India Limited - India
- Australian Commodity Traders Exchange
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- Maheswari Brothers Coal Limited - India
- IEA Clean Coal Centre - UK
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Eastern Coal Council - USA
- Mercuria Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Makarim & Taira - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Petron Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- Carbofer General Trading SA - India
- Leighton Contractors Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Altura Mining Limited, Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Global Green Power PLC Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- New Zealand Coal & Carbon
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Salva Resources Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Heidelberg Cement - Germany
- Siam City Cement - Thailand
- The State Trading Corporation of India Ltd
- MS Steel International - UAE
- Parliament of New Zealand
- Chamber of Mines of South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Cement Manufacturers Association - India
- Orica Mining Services - Indonesia
- Commonwealth Bank - Australia
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Transport, Egypt
- Marubeni Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Central Electricity Authority - India
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