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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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Wednesday, 15 January 14
INDONESIAN MINING LAW AVERTS BOP PRESSURE, RISKS REMAIN, FITCH SAYS
The last-minute intervention at the weekend by Indonesia's politicians to avert a significant disruption of mining activity and exports, should lim ...
Wednesday, 15 January 14
Q3 AND Q4 INDONESIAN COAL SWAPS DECLINE MONTH ON MONTH
COALspot.com – Sub-Bit Indonesia coal swap (FOB) for average Q1’ 14 delivery lost $ 1.23 pmt month on month on Friday 10 January 2014. T ...
Wednesday, 15 January 14
PANAMAX: PACIFIC - REMAINED QUIET; ATLANTIC - CONTINUED THEIR RETREAT
COALspot.com: The holiday hangover seems well underway for the Dry Bulk market that saw more ground being lost this past week. The BDI has closed of ...
Tuesday, 14 January 14
AUSTRALIAN NEWCASTLE PORT'S WEEKLY COAL EXPORTS FALL 18.28 %
COALspot.com: In the week ended January 13, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled 2.67 ...
Monday, 13 January 14
INDONESIAN ORE BAN TO HAVE LIMITED IMPACT ON CHINESE ALUMINIUM PRODUCERS, FITCH RATINGS SAYS
COALspot.com: Fitch Ratings says today that Indonesia's ban on exports of unprocessed mineral ore will have limited impact on Chinese aluminium pro ...
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- Thiess Contractors Indonesia
- Maheswari Brothers Coal Limited - India
- Bukit Makmur.PT - Indonesia
- Petron Corporation, Philippines
- New Zealand Coal & Carbon
- Manunggal Multi Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- GAC Shipping (India) Pvt Ltd
- London Commodity Brokers - England
- Energy Link Ltd, New Zealand
- Ceylon Electricity Board - Sri Lanka
- Madhucon Powers Ltd - India
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vedanta Resources Plc - India
- Africa Commodities Group - South Africa
- Leighton Contractors Pty Ltd - Australia
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Borneo Indobara - Indonesia
- Price Waterhouse Coopers - Russia
- Gujarat Sidhee Cement - India
- Bhatia International Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Ambuja Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- CIMB Investment Bank - Malaysia
- Bhoruka Overseas - Indonesia
- Cement Manufacturers Association - India
- Sree Jayajothi Cements Limited - India
- Vizag Seaport Private Limited - India
- Standard Chartered Bank - UAE
- Central Electricity Authority - India
- Heidelberg Cement - Germany
- Sindya Power Generating Company Private Ltd
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- International Coal Ventures Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Miang Besar Coal Terminal - Indonesia
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Gujarat Mineral Development Corp Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Electricity Authority, New Zealand
- Meralco Power Generation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Australian Coal Association
- Uttam Galva Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Dalmia Cement Bharat India
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- VISA Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Parry Sugars Refinery, India
- Eastern Coal Council - USA
- Mercator Lines Limited - India
- Timah Investasi Mineral - Indoneisa
- Ind-Barath Power Infra Limited - India
- Mintek Dendrill Indonesia
- Chamber of Mines of South Africa
- IEA Clean Coal Centre - UK
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- SMG Consultants - Indonesia
- Kaltim Prima Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Straits Asia Resources Limited - Singapore
- India Bulls Power Limited - India
- Indika Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Karaikal Port Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- Formosa Plastics Group - Taiwan
- Ministry of Mines - Canada
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Coastal Gujarat Power Limited - India
- Planning Commission, India
- Attock Cement Pakistan Limited
- Sical Logistics Limited - India
- Georgia Ports Authority, United States
- Banpu Public Company Limited - Thailand
- MS Steel International - UAE
- White Energy Company Limited
- McConnell Dowell - Australia
- Bhushan Steel Limited - India
- Anglo American - United Kingdom
- Tamil Nadu electricity Board
- Posco Energy - South Korea
- The University of Queensland
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Billiton Holdings Pty Ltd - Australia
- Directorate General of MIneral and Coal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Aboitiz Power Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- Antam Resourcindo - Indonesia
- Global Business Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Agrawal Coal Company - India
- PTC India Limited - India
- Bharathi Cement Corporation - India
- Simpson Spence & Young - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Salva Resources Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- GVK Power & Infra Limited - India
- Interocean Group of Companies - India
- Savvy Resources Ltd - HongKong
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- The Treasury - Australian Government
- ICICI Bank Limited - India
- Krishnapatnam Port Company Ltd. - India
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- Essar Steel Hazira Ltd - India
- Deloitte Consulting - India
- Latin American Coal - Colombia
- CNBM International Corporation - China
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement PLC, Thailand
- ASAPP Information Group - India
- Trasteel International SA, Italy
- Electricity Generating Authority of Thailand
- Holcim Trading Pte Ltd - Singapore
- Sinarmas Energy and Mining - Indonesia
- Intertek Mineral Services - Indonesia
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- Mjunction Services Limited - India
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- Lanco Infratech Ltd - India
- Indian Oil Corporation Limited
- Indonesian Coal Mining Association
- Kobexindo Tractors - Indoneisa
- Global Coal Blending Company Limited - Australia
- Kepco SPC Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Power Finance Corporation Ltd., India
- IHS Mccloskey Coal Group - USA
- Videocon Industries ltd - India
- Bangladesh Power Developement Board
- Renaissance Capital - South Africa
- Kumho Petrochemical, South Korea
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Carbofer General Trading SA - India
- South Luzon Thermal Energy Corporation
- Star Paper Mills Limited - India
- Medco Energi Mining Internasional
- OPG Power Generation Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Bahari Cakrawala Sebuku - Indonesia
- Parliament of New Zealand
- Bulk Trading Sa - Switzerland
- Larsen & Toubro Limited - India
- Malabar Cements Ltd - India
- Orica Mining Services - Indonesia
- Semirara Mining Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Globalindo Alam Lestari - Indonesia
- Altura Mining Limited, Indonesia
- Therma Luzon, Inc, Philippines
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Marubeni Corporation - India
- Asmin Koalindo Tuhup - Indonesia
- San Jose City I Power Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Rio Tinto Coal - Australia
- Minerals Council of Australia
- Edison Trading Spa - Italy
- SMC Global Power, Philippines
- Indian Energy Exchange, India
- The State Trading Corporation of India Ltd
- Wilmar Investment Holdings
- Goldman Sachs - Singapore
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Oldendorff Carriers - Singapore
- Cigading International Bulk Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- GMR Energy Limited - India
- Commonwealth Bank - Australia
- Makarim & Taira - Indonesia
- Xindia Steels Limited - India
- Ministry of Finance - Indonesia
- Indogreen Group - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Sojitz Corporation - Japan
- Mercuria Energy - Indonesia
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