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Monday, 15 December 14
WILL TANKERS BENEFIT FROM REEMERGENCE OF FLOATING STORAGE PLAYS? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The tanker market has been seeing high freight rates for some time now, riding on the back of low oil prices, which are boosting demand from developing nations, looking to replenish their stockpiles. However, another factor could also emerge, with the return of floating storage plays. According to the latest report from shipbroker Charles R. Weber, “following strong crude price losses during late 2008 and early 2009, the $45 emergence of a steep contango in crude futures markets supported a surge in demand for tankers to service floating storage contracts. By 2010, as the $30 wheels of the global economy improved on a return to strong growth in $15 emerging economies, the contango curve became steep enough to support $0 floating storage sufficiently to consume through much of 1H10 upwards of 10% of the global VLCC fleet. This lead to stronger earnings for the class with knock on effects for smaller tanker counterparts as overall availability levels declined”.
According to the shipbroker, “when crude prices started observing losses early during 2H14, the reemergence $60 of a contangoed futures curve reignited consideration of floating storage, but $45 little has materialized as the S/bbl storage costs consistently forward crude spreads. With the global demand/supply imbalance having extended through $30 2H14, the unwillingness by OPEC (or more specifically: a prominent contingent of OPEC’s membership) to react through supply cuts, recent downward $15 revisions by key oil forecasting agencies to demand projections implies that a wider imbalance will materialize during 2015. In its latest report, the IEA notes $0 the imbalance with a corresponding rise in implied steep building up of global crude inventories of relative earnings strength (if below present peak levels). How the crude $80 market develops thereafter will likely dictate the course that tanker earnings take through the remainder of 2015. $60 For its part, support from floating storage remains off the table due to the $40 prohibitively high cost to procure tonnage for such a purpose”.
C.R. Weber noted that “at present assessments, a 6 month floating storage contract off Singapore would equate to $20 a cost ~$5.84/bbl while the spread between Brent’s front month and July contracts stands at $3.72/bbl Further into 2015, however, continued crude price losses which could be inferred by the |EA’s projected widening of the global demand/supply $40 imbalance could lead to crude supply cuts to support prices. Though such a $30 scenario represents a threat to crude tanker demand, a simultaneous correcting of freight markets and steepening of contango curves could create the requisite $20 economics to support floating storage. This would likely place a floor on prospective freight downside while bridging the market to a subsequent $10 rebalancing of crude markets, thus limiting an impact on crude tanker earnings”, the shipbroker concluded.
Meanwhile, in the crude tanker markets this week, in the VLCC segment “rates firmed this week as charterers worked through much of the remainder of the Middle East market’s December program while owners became more bullish in a late reaction to narrower supply/demand fundamentals. Stronger demand in the Middle East market – where the December program has already yielded the most cargoes since the April program and is poised to conclude with the most since the February market – has coincided with a recent demand acceleration in the West Africa market. As both of these areas draw from Middle East positions, the region’s supply/demand positioning is at its narrowest level since 2008 with just 5 surplus positions through end? December dates. With 118 Middle East December cargoes covered to date and the program expected to conclude with 121, the 8 units which remain on position lists to cover the remaining stems appear set to observe premiums to present assessments. How aggressively charterers progress into the January program during the upcoming week will thus likely dictate the direction that rates will take for early January cargoes. Given shortened working weeks during the final two weeks of the year, charterers could reach forward on dates (as the market already is observing) during the upcoming week to cover requirements ahead of the holidays. Against the tight supply/demand profile, this would imply an extending of the present rate rally. Further forward, as the market moves past the first half of the January program and forward fixing windows normalize, the reappearance of units presently on trades to points in the east on Middle East position lists should see rates start to correct”, C.R. Weber concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Friday, 05 December 14
CHINESE SPECIAL STEEL MAKERS' RISK PROFILES MORE RESILIENT - FITCH
Fitch Ratings says the risk profiles of Chinese makers of special steel, especially high-end products, are more like those of manufacturers and mor ...
Friday, 05 December 14
U.S. YEAR-TO-DATE COAL PRODUCTION REACHED AROUND 905 MMST - EIA
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19 million short tons (mmst) of coal i ...
Thursday, 04 December 14
CAPE MARKET IS DEVELOPING FROM BAD TO WORSE
Handy
The Atlantic market has been pretty stable and balanced this week, Fearnleys AS says in its latest weekly report.
The broker furt ...
Thursday, 04 December 14
DRY BULK MARKET; ANOTHER DISAPPOINTING WEEK
COALspot.com: For those who have been hoping to see alignment of freight direction across the Dry Bulk market, this must have been another disappoi ...
Wednesday, 03 December 14
PROGRESSING SMELTER PROJECTS IN INDONESIA
Press Release: Indonesia’s ban on ‘raw mineral export’ that was designed to encouraging downstream investment in mineral processi ...
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- Indian Energy Exchange, India
- South Luzon Thermal Energy Corporation
- Rashtriya Ispat Nigam Limited - India
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Kapuas Tunggal Persada - Indonesia
- Iligan Light & Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Mintek Dendrill Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Toyota Tsusho Corporation, Japan
- Interocean Group of Companies - India
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Vizag Seaport Private Limited - India
- Coastal Gujarat Power Limited - India
- Kobexindo Tractors - Indoneisa
- Orica Mining Services - Indonesia
- Latin American Coal - Colombia
- Sree Jayajothi Cements Limited - India
- GVK Power & Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Ceylon Electricity Board - Sri Lanka
- San Jose City I Power Corp, Philippines
- Port Waratah Coal Services - Australia
- McConnell Dowell - Australia
- Indogreen Group - Indonesia
- India Bulls Power Limited - India
- Aditya Birla Group - India
- Ambuja Cements Ltd - India
- Banpu Public Company Limited - Thailand
- OPG Power Generation Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Coal and Oil Company - UAE
- Power Finance Corporation Ltd., India
- Therma Luzon, Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Wood Mackenzie - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Makarim & Taira - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Baramulti Group, Indonesia
- Tamil Nadu electricity Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- Australian Coal Association
- Meralco Power Generation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Standard Chartered Bank - UAE
- Holcim Trading Pte Ltd - Singapore
- SN Aboitiz Power Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Coalindo Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bhatia International Limited - India
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Semirara Mining and Power Corporation, Philippines
- Rio Tinto Coal - Australia
- Commonwealth Bank - Australia
- GN Power Mariveles Coal Plant, Philippines
- London Commodity Brokers - England
- Gujarat Sidhee Cement - India
- Petron Corporation, Philippines
- Wilmar Investment Holdings
- Sindya Power Generating Company Private Ltd
- GMR Energy Limited - India
- Vedanta Resources Plc - India
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Essar Steel Hazira Ltd - India
- Timah Investasi Mineral - Indoneisa
- LBH Netherlands Bv - Netherlands
- Oldendorff Carriers - Singapore
- Romanian Commodities Exchange
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Pendopo Energi Batubara - Indonesia
- Semirara Mining Corp, Philippines
- Samtan Co., Ltd - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- Carbofer General Trading SA - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Eastern Energy - Thailand
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Medco Energi Mining Internasional
- Georgia Ports Authority, United States
- Bukit Makmur.PT - Indonesia
- Central Electricity Authority - India
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- Indian Oil Corporation Limited
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercuria Energy - Indonesia
- Merrill Lynch Commodities Europe
- Bhoruka Overseas - Indonesia
- Bhushan Steel Limited - India
- Star Paper Mills Limited - India
- Bukit Baiduri Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Formosa Plastics Group - Taiwan
- International Coal Ventures Pvt Ltd - India
- Borneo Indobara - Indonesia
- Malabar Cements Ltd - India
- Parliament of New Zealand
- Cement Manufacturers Association - India
- PowerSource Philippines DevCo
- PTC India Limited - India
- SMG Consultants - Indonesia
- Siam City Cement PLC, Thailand
- New Zealand Coal & Carbon
- Aboitiz Power Corporation - Philippines
- Lanco Infratech Ltd - India
- Madhucon Powers Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Karaikal Port Pvt Ltd - India
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- ICICI Bank Limited - India
- Agrawal Coal Company - India
- Riau Bara Harum - Indonesia
- Energy Development Corp, Philippines
- Economic Council, Georgia
- Parry Sugars Refinery, India
- Electricity Generating Authority of Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dalmia Cement Bharat India
- Africa Commodities Group - South Africa
- MS Steel International - UAE
- Kohat Cement Company Ltd. - Pakistan
- Australian Commodity Traders Exchange
- Uttam Galva Steels Limited - India
- PNOC Exploration Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Alfred C Toepfer International GmbH - Germany
- Globalindo Alam Lestari - Indonesia
- Global Business Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Minerals Council of Australia
- Deloitte Consulting - India
- Altura Mining Limited, Indonesia
- White Energy Company Limited
- SMC Global Power, Philippines
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Indo Tambangraya Megah - Indonesia
- Orica Australia Pty. Ltd.
- Siam City Cement - Thailand
- Bayan Resources Tbk. - Indonesia
- Electricity Authority, New Zealand
- Thai Mozambique Logistica
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- Billiton Holdings Pty Ltd - Australia
- Gujarat Mineral Development Corp Ltd - India
- Price Waterhouse Coopers - Russia
- Eastern Coal Council - USA
- Krishnapatnam Port Company Ltd. - India
- IEA Clean Coal Centre - UK
- Marubeni Corporation - India
- Anglo American - United Kingdom
- Larsen & Toubro Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Chamber of Mines of South Africa
- Karbindo Abesyapradhi - Indoneisa
- The University of Queensland
- Indika Energy - Indonesia
- Goldman Sachs - Singapore
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- Sakthi Sugars Limited - India
- Kaltim Prima Coal - Indonesia
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Thiess Contractors Indonesia
- Bangladesh Power Developement Board
- Renaissance Capital - South Africa
- Global Coal Blending Company Limited - Australia
- Central Java Power - Indonesia
- Jindal Steel & Power Ltd - India
- European Bulk Services B.V. - Netherlands
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Videocon Industries ltd - India
- CIMB Investment Bank - Malaysia
- Planning Commission, India
- Heidelberg Cement - Germany
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Jaiprakash Power Ventures ltd
- Posco Energy - South Korea
- Sojitz Corporation - Japan
- Directorate Of Revenue Intelligence - India
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