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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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Sunday, 16 February 14
SUPRAMAX : THE FAR EAST/SE ASIA CHARTER RATES FIRMED UP
COALspot.com: The freight market had a mixed reaction this week with BDI increased by 1.37 pct and closing at 1106 points on Valentine day. The cape ...
Friday, 14 February 14
US COAL PRODUCTION STILL SLIPPING
COALspot.com – United States the world’s second largest coal producer, produced approximately 17.9 million short tons (mmst) of coal in ...
Thursday, 13 February 14
PANAMAX : NOT ENOUGH REQUIREMENTS TO KEEP THE ATLANTIC MARKET FLOATING - FEARNLEYS AS
Handy
After the Chinese holidays the week started on a positive note. Owners are talking higher rates but chrtrs are still somehow reluctant to mov ...
Thursday, 13 February 14
DRY BULK MARKET FACES BETTER PROSPECTS ON THE BACK OF IMPROVING DEMAND AND SUPPLY BALANCE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has started off the New Year on the "left foot", with the strong finish of 2013 proving to be unsustainable, on the ba ...
Wednesday, 12 February 14
NEW BUILDING ORDERS REACHING NEW POST-CRISIS HEIGHTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Ship owners are looking to take advantage of the last few attractive deals in the new building market, before prices start climbing to new highs and ...
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- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Makarim & Taira - Indonesia
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- Interocean Group of Companies - India
- Planning Commission, India
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- Banpu Public Company Limited - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Samtan Co., Ltd - South Korea
- Parliament of New Zealand
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- Indonesian Coal Mining Association
- Therma Luzon, Inc, Philippines
- Kumho Petrochemical, South Korea
- Indian Oil Corporation Limited
- Thiess Contractors Indonesia
- Renaissance Capital - South Africa
- Iligan Light & Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- GVK Power & Infra Limited - India
- Vedanta Resources Plc - India
- Kartika Selabumi Mining - Indonesia
- Central Electricity Authority - India
- Energy Link Ltd, New Zealand
- Bukit Baiduri Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- VISA Power Limited - India
- Directorate Of Revenue Intelligence - India
- Australian Coal Association
- Aditya Birla Group - India
- New Zealand Coal & Carbon
- Marubeni Corporation - India
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Kaltim Prima Coal - Indonesia
- Wood Mackenzie - Singapore
- International Coal Ventures Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Mines - Canada
- Malabar Cements Ltd - India
- India Bulls Power Limited - India
- Mjunction Services Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Commonwealth Bank - Australia
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- Kideco Jaya Agung - Indonesia
- Global Business Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Attock Cement Pakistan Limited
- Meenaskhi Energy Private Limited - India
- Rio Tinto Coal - Australia
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Barasentosa Lestari - Indonesia
- Meralco Power Generation, Philippines
- Tata Chemicals Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- IEA Clean Coal Centre - UK
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Electricity Authority, New Zealand
- Indian Energy Exchange, India
- Power Finance Corporation Ltd., India
- Ministry of Transport, Egypt
- Bayan Resources Tbk. - Indonesia
- Indogreen Group - Indonesia
- European Bulk Services B.V. - Netherlands
- OPG Power Generation Pvt Ltd - India
- Energy Development Corp, Philippines
- Altura Mining Limited, Indonesia
- Sarangani Energy Corporation, Philippines
- Orica Australia Pty. Ltd.
- Miang Besar Coal Terminal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Lanco Infratech Ltd - India
- Economic Council, Georgia
- Jaiprakash Power Ventures ltd
- CNBM International Corporation - China
- Singapore Mercantile Exchange
- Krishnapatnam Port Company Ltd. - India
- Salva Resources Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- The Treasury - Australian Government
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- SMC Global Power, Philippines
- Georgia Ports Authority, United States
- Indika Energy - Indonesia
- Sojitz Corporation - Japan
- Kapuas Tunggal Persada - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- Asmin Koalindo Tuhup - Indonesia
- Antam Resourcindo - Indonesia
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- Petron Corporation, Philippines
- Siam City Cement PLC, Thailand
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- Coastal Gujarat Power Limited - India
- Thai Mozambique Logistica
- White Energy Company Limited
- McConnell Dowell - Australia
- The University of Queensland
- Coalindo Energy - Indonesia
- Vizag Seaport Private Limited - India
- Baramulti Group, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Price Waterhouse Coopers - Russia
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- South Luzon Thermal Energy Corporation
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- PowerSource Philippines DevCo
- London Commodity Brokers - England
- Bulk Trading Sa - Switzerland
- Siam City Cement - Thailand
- Romanian Commodities Exchange
- ASAPP Information Group - India
- Semirara Mining and Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Africa Commodities Group - South Africa
- Eastern Coal Council - USA
- Essar Steel Hazira Ltd - India
- CIMB Investment Bank - Malaysia
- Star Paper Mills Limited - India
- Sree Jayajothi Cements Limited - India
- Videocon Industries ltd - India
- Carbofer General Trading SA - India
- Riau Bara Harum - Indonesia
- Grasim Industreis Ltd - India
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- ICICI Bank Limited - India
- Agrawal Coal Company - India
- Minerals Council of Australia
- Leighton Contractors Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Sindya Power Generating Company Private Ltd
- Orica Mining Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Bharathi Cement Corporation - India
- Sakthi Sugars Limited - India
- Toyota Tsusho Corporation, Japan
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- Ministry of Finance - Indonesia
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Mercuria Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bhoruka Overseas - Indonesia
- Binh Thuan Hamico - Vietnam
- Bhatia International Limited - India
- Australian Commodity Traders Exchange
- Heidelberg Cement - Germany
- TeaM Sual Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- Oldendorff Carriers - Singapore
- Bukit Makmur.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Global Coal Blending Company Limited - Australia
- Parry Sugars Refinery, India
- Wilmar Investment Holdings
- Cement Manufacturers Association - India
- Globalindo Alam Lestari - Indonesia
- Tamil Nadu electricity Board
- TNB Fuel Sdn Bhd - Malaysia
- Goldman Sachs - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Dalmia Cement Bharat India
- Metalloyd Limited - United Kingdom
- Pendopo Energi Batubara - Indonesia
- Coal and Oil Company - UAE
- GMR Energy Limited - India
- Port Waratah Coal Services - Australia
- Gujarat Sidhee Cement - India
- Edison Trading Spa - Italy
- Mercator Lines Limited - India
- Karaikal Port Pvt Ltd - India
- SMG Consultants - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Medco Energi Mining Internasional
- Gujarat Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Holcim Trading Pte Ltd - Singapore
- Madhucon Powers Ltd - India
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Rashtriya Ispat Nigam Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Offshore Bulk Terminal Pte Ltd, Singapore
- PNOC Exploration Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
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