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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, 17 January 14
SPOT COAL PRICE TRENDS IN US VARY ACROSS KEY BASINS DURING 2013, SAYS EIA
COALspot.com: Spot steam coal price trends in US varied across key basins in 2013, a latest EIA report says. Compared with 2012, while total coal de ...
Thursday, 16 January 14
PANAMAX : THE GAP BETWEEN SPOT AND PERIOD HAS INCREASED IN BOTH HEMISPHERES - FEARNRESEARCH
Handy
In the Atlantic we have seen rates slowly sliding on lack of enough fresh business. USG/Continent still paying excess 28k and seems on an upw ...
Thursday, 16 January 14
SHIP OWNERS SCRAP 1,119 SHIPS DURING 2013 ON THE BACK OF OVERSUPPLY ISSUES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Scrapping of older vessels is still the best bet that ship owners can make, in order to improve their newer vessels' fortunes, amid an oversupply o ...
Wednesday, 15 January 14
KOREA MIDLAND POWER CO INVITES BIDS FOR 360K MT OF SUB-BITUMINOUS COAL FOR ITS BORYEONG PLANT
COALspot.com : Korea Midland Power Co., Ltd. has invited bids through International open bidding for 360,000 Metric Tons (MT) of sub-bituminous ...
Wednesday, 15 January 14
CFR SOUTH CHINA COAL SWAPS FALL BY 6.57% MONTH ON MONTH
COALspot.com : API 8 CFR South China Coal swaps for average Q1’ 14 delivery lost 6.57 percept month on month and closed at US$ 78.90 per mt as ...
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- Globalindo Alam Lestari - Indonesia
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Coalindo Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Chettinad Cement Corporation Ltd - India
- LBH Netherlands Bv - Netherlands
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- VISA Power Limited - India
- Tamil Nadu electricity Board
- Bukit Asam (Persero) Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Sree Jayajothi Cements Limited - India
- Gujarat Electricity Regulatory Commission - India
- Binh Thuan Hamico - Vietnam
- Anglo American - United Kingdom
- Indian Energy Exchange, India
- Bharathi Cement Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- IHS Mccloskey Coal Group - USA
- Krishnapatnam Port Company Ltd. - India
- Formosa Plastics Group - Taiwan
- Ind-Barath Power Infra Limited - India
- Wood Mackenzie - Singapore
- Makarim & Taira - Indonesia
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Trasteel International SA, Italy
- Deloitte Consulting - India
- Directorate Of Revenue Intelligence - India
- Independent Power Producers Association of India
- Aboitiz Power Corporation - Philippines
- Riau Bara Harum - Indonesia
- Siam City Cement - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Global Green Power PLC Corporation, Philippines
- Posco Energy - South Korea
- Standard Chartered Bank - UAE
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Maheswari Brothers Coal Limited - India
- Romanian Commodities Exchange
- Bulk Trading Sa - Switzerland
- Jaiprakash Power Ventures ltd
- Bangladesh Power Developement Board
- Maharashtra Electricity Regulatory Commission - India
- Vizag Seaport Private Limited - India
- Australian Commodity Traders Exchange
- Power Finance Corporation Ltd., India
- Simpson Spence & Young - Indonesia
- Larsen & Toubro Limited - India
- Madhucon Powers Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Semirara Mining Corp, Philippines
- Minerals Council of Australia
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Jorong Barutama Greston.PT - Indonesia
- Borneo Indobara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Leighton Contractors Pty Ltd - Australia
- Kalimantan Lumbung Energi - Indonesia
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Holcim Trading Pte Ltd - Singapore
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Indogreen Group - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Interocean Group of Companies - India
- Bhatia International Limited - India
- PNOC Exploration Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Mines - Canada
- Essar Steel Hazira Ltd - India
- India Bulls Power Limited - India
- Petron Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- Bayan Resources Tbk. - Indonesia
- Chamber of Mines of South Africa
- Eastern Coal Council - USA
- Latin American Coal - Colombia
- Vedanta Resources Plc - India
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- Banpu Public Company Limited - Thailand
- Economic Council, Georgia
- Mercator Lines Limited - India
- SMG Consultants - Indonesia
- Kartika Selabumi Mining - Indonesia
- ICICI Bank Limited - India
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Wilmar Investment Holdings
- PetroVietnam Power Coal Import and Supply Company
- SMC Global Power, Philippines
- Xindia Steels Limited - India
- Africa Commodities Group - South Africa
- Kumho Petrochemical, South Korea
- Kideco Jaya Agung - Indonesia
- Coastal Gujarat Power Limited - India
- The Treasury - Australian Government
- Salva Resources Pvt Ltd - India
- Sojitz Corporation - Japan
- MS Steel International - UAE
- The University of Queensland
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Baramulti Group, Indonesia
- ASAPP Information Group - India
- Thiess Contractors Indonesia
- Thai Mozambique Logistica
- Sindya Power Generating Company Private Ltd
- Star Paper Mills Limited - India
- GMR Energy Limited - India
- OPG Power Generation Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Kohat Cement Company Ltd. - Pakistan
- London Commodity Brokers - England
- Samtan Co., Ltd - South Korea
- European Bulk Services B.V. - Netherlands
- San Jose City I Power Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Cigading International Bulk Terminal - Indonesia
- Eastern Energy - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Commonwealth Bank - Australia
- Ministry of Transport, Egypt
- Central Electricity Authority - India
- PTC India Limited - India
- Global Business Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Orica Mining Services - Indonesia
- Altura Mining Limited, Indonesia
- Coal and Oil Company - UAE
- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- Price Waterhouse Coopers - Russia
- TeaM Sual Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Meralco Power Generation, Philippines
- Grasim Industreis Ltd - India
- Meenaskhi Energy Private Limited - India
- Mjunction Services Limited - India
- Planning Commission, India
- GVK Power & Infra Limited - India
- Indo Tambangraya Megah - Indonesia
- Ambuja Cements Ltd - India
- Carbofer General Trading SA - India
- Pipit Mutiara Jaya. PT, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Antam Resourcindo - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Lanco Infratech Ltd - India
- Edison Trading Spa - Italy
- Mercuria Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Orica Australia Pty. Ltd.
- Aditya Birla Group - India
- Electricity Generating Authority of Thailand
- Energy Link Ltd, New Zealand
- Bhushan Steel Limited - India
- Georgia Ports Authority, United States
- Miang Besar Coal Terminal - Indonesia
- Sarangani Energy Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- Sakthi Sugars Limited - India
- IEA Clean Coal Centre - UK
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Iligan Light & Power Inc, Philippines
- Savvy Resources Ltd - HongKong
- Marubeni Corporation - India
- Gujarat Sidhee Cement - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PowerSource Philippines DevCo
- The State Trading Corporation of India Ltd
- Neyveli Lignite Corporation Ltd, - India
- Sinarmas Energy and Mining - Indonesia
- Australian Coal Association
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Billiton Holdings Pty Ltd - Australia
- South Luzon Thermal Energy Corporation
- McConnell Dowell - Australia
- CIMB Investment Bank - Malaysia
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Port Waratah Coal Services - Australia
- Semirara Mining and Power Corporation, Philippines
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Parliament of New Zealand
- Pendopo Energi Batubara - Indonesia
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