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Wednesday, 07 January 15
FUEL EFFICIENT SHIPS MAKE LESS SENSE IN LOWER BUNKER PRICE MARKET, BUT FUEL COSTS ARE BOUND TO RISE AGAIN
 The shipping industry entered 2015 on mixed emotions, as a relatively buoyant tanker market is met by a rather lackluster dry bulk market. Still, all ship owners will undoubtedly be happy about the fact that the most important cost driving factor, bunker prices, are way down since the same period of last year. In fact, bunker prices are down by more than 30% since last year, as already, by the end of November of 2014, the cost of Heavy Fuel Oil (HFO) in Fujairah had declined to $460 per metric ton from an average of $609/mt over the first six months of 2014. That’s already a reduction of 24% and more has come since then, on the back of constantly declining crude prices.
Given the fact that bunker prices is the biggest factor in a ship’s operating costs, that kind of reduction is rather significant and one which can offset any loss in terms of freight rates. Thus, ship owners can take advantage of this low cost environment and increase their earnings, through the subsequent fall of OPEX. On the other hand, other factor like the new fuel efficient vessels, or slow steaming are coming into play.
According to a recent report from Poten & Partners, “due to the high oil prices over the last couple of years and the anticipation of continuing high prices in the future, owners have made operational adjustments by utilizing slow steaming on the ballast leg of a voyage, while shipyards and engine manufacturers have worked hard to improve the fuel efficiency of new ships. Using a VLCC as the basis for such analysis as the longer voyages benefit relatively more from fuel efficiency, we use a 2007 built VLCC ordered when HFO prices were around $160/MT and a modern 2013 built VLCC. Vessels can vary significantly in their fuel consumption, both through design and over time, dependent on the condition of the hull paint, etc. The modern vessel in our example saves 7 tons/day in laden condition compared to the older design and 4 tons/day while in ballast. For the comparison we will use the typical VLCC round trip voyage from Ras Tanura to Chiba using the current fuel price ($460/MT) and the average price during the first 6 months of 2014 ($609/MT). On the round trip, the fuel efficient vessel saves $116,200 in fuel with current prices and $151,500 in the higher price environment compared to the 2007 built vessel. This represents savings of $2,179/day in time charter equivalent (TCE) at current bunker prices and $2,839 at 2014H1 bunker prices”.
Poten added that “in order to improve TCE, owners have made operational adjustments by slow steaming during the ballast leg of the voyages, and during the laden leg where it was permitted in the charter party. This helps the owners by improving the economics on individual voyages as the fuel cost savings more than offset the longer steaming time when the market is low. An added benefit is that slow steaming reduces the efficiency or the fleet as more vessels are needed to move the same volume of cargo. Earlier in the year, when the rates were lower, slow steaming made more sense as the additional revenue that could be earned during the additional 3.9 ballasting days was lower than the fuel savings. At current market rates and lower bunker prices, this situation has shifted. At least for the vessel and voyage combination in our example, increasing the ballast speed could prove to be beneficial. The situation could be different for other vessels and voyages, but it makes the case for owners to run the numbers. The benefits of fuel efficient designs might have been reduced for now but the investment is for 20+ years and fuel prices are likely to increase again in the future”, the analyst concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Wednesday, 21 January 15
PANAMAX MARKET MOVED SIDEWAYS OVERALL LAST WEEK - INTERMODAL
COALspot.com: The positive sentiment in which the week prior ended carried on through-out last week as well, the end of which marked the first posi ...
Wednesday, 21 January 15
SHIFT IN INTERNATIONAL COAL TRADE TO THE PACIFIC BASIN WILL CONTINUE - IMF
COALspot.com: The shift in international coal trade to the Pacific Basin will continue, IMF said in its latest Medium-Term Coal Market Report.
...
Wednesday, 21 January 15
MARKET INSIGHT - VASSILIS LOGOTHETIS, INTERMODAL
The World Bank has lowered its forecast for global growth in 2015 to 3% down from its previous level of 3.4% amid rising concerns over the economic ...
Wednesday, 21 January 15
THERMAL COAL PRICE OUTLOOK DEPENDENT ON INDIAN IMPORT DEMAND - MATTHEW BOYLE, CRU
COALspot.com: Supply and demand side developments in India will be an important determinant of future market dynamics and prices for thermal coal a ...
Wednesday, 21 January 15
PORT OF NEWCASTLE COAL EXPORTS JUMP 16.19% ON MONTH TO 15.80 MIL MT IN DECEMBER' 14
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $1.136 billi ...
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- Maheswari Brothers Coal Limited - India
- Leighton Contractors Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Electricity Authority, New Zealand
- Australian Coal Association
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Business Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Jaiprakash Power Ventures ltd
- Asmin Koalindo Tuhup - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Banpu Public Company Limited - Thailand
- Rashtriya Ispat Nigam Limited - India
- Port Waratah Coal Services - Australia
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- Tamil Nadu electricity Board
- Formosa Plastics Group - Taiwan
- Coal and Oil Company - UAE
- Sindya Power Generating Company Private Ltd
- Latin American Coal - Colombia
- Kumho Petrochemical, South Korea
- New Zealand Coal & Carbon
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Orica Australia Pty. Ltd.
- Sojitz Corporation - Japan
- Bhoruka Overseas - Indonesia
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- London Commodity Brokers - England
- Asia Pacific Energy Resources Ventures Inc, Philippines
- San Jose City I Power Corp, Philippines
- PTC India Limited - India
- Coastal Gujarat Power Limited - India
- The University of Queensland
- IEA Clean Coal Centre - UK
- Vizag Seaport Private Limited - India
- Mercuria Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Borneo Indobara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bharathi Cement Corporation - India
- Bulk Trading Sa - Switzerland
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kartika Selabumi Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- Aditya Birla Group - India
- Kalimantan Lumbung Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- Goldman Sachs - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- Billiton Holdings Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Parry Sugars Refinery, India
- Indo Tambangraya Megah - Indonesia
- The Treasury - Australian Government
- Madhucon Powers Ltd - India
- Posco Energy - South Korea
- Wood Mackenzie - Singapore
- Indogreen Group - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bhatia International Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Mjunction Services Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Malabar Cements Ltd - India
- Xindia Steels Limited - India
- Carbofer General Trading SA - India
- Indonesian Coal Mining Association
- Singapore Mercantile Exchange
- Globalindo Alam Lestari - Indonesia
- Kaltim Prima Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Ambuja Cements Ltd - India
- MS Steel International - UAE
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Commonwealth Bank - Australia
- Timah Investasi Mineral - Indoneisa
- Ministry of Transport, Egypt
- Electricity Generating Authority of Thailand
- Energy Link Ltd, New Zealand
- Kapuas Tunggal Persada - Indonesia
- Therma Luzon, Inc, Philippines
- Indika Energy - Indonesia
- Vedanta Resources Plc - India
- Price Waterhouse Coopers - Russia
- GMR Energy Limited - India
- Parliament of New Zealand
- Gujarat Sidhee Cement - India
- Australian Commodity Traders Exchange
- VISA Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- International Coal Ventures Pvt Ltd - India
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- ASAPP Information Group - India
- Global Green Power PLC Corporation, Philippines
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Kideco Jaya Agung - Indonesia
- Pendopo Energi Batubara - Indonesia
- Toyota Tsusho Corporation, Japan
- Sakthi Sugars Limited - India
- Sical Logistics Limited - India
- Bukit Baiduri Energy - Indonesia
- Larsen & Toubro Limited - India
- Simpson Spence & Young - Indonesia
- Wilmar Investment Holdings
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- Heidelberg Cement - Germany
- Indian Energy Exchange, India
- OPG Power Generation Pvt Ltd - India
- Riau Bara Harum - Indonesia
- GVK Power & Infra Limited - India
- Rio Tinto Coal - Australia
- Barasentosa Lestari - Indonesia
- Central Electricity Authority - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Metalloyd Limited - United Kingdom
- Ministry of Mines - Canada
- SMC Global Power, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- Deloitte Consulting - India
- Cigading International Bulk Terminal - Indonesia
- Savvy Resources Ltd - HongKong
- Eastern Coal Council - USA
- Cement Manufacturers Association - India
- Siam City Cement PLC, Thailand
- Aboitiz Power Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Indian Oil Corporation Limited
- India Bulls Power Limited - India
- IHS Mccloskey Coal Group - USA
- Thai Mozambique Logistica
- Mercator Lines Limited - India
- Siam City Cement - Thailand
- Bhushan Steel Limited - India
- Mintek Dendrill Indonesia
- Altura Mining Limited, Indonesia
- SN Aboitiz Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- Merrill Lynch Commodities Europe
- Binh Thuan Hamico - Vietnam
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Videocon Industries ltd - India
- Petron Corporation, Philippines
- Eastern Energy - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Interocean Group of Companies - India
- The State Trading Corporation of India Ltd
- Marubeni Corporation - India
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Energy Development Corp, Philippines
- White Energy Company Limited
- AsiaOL BioFuels Corp., Philippines
- Bangladesh Power Developement Board
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Central Java Power - Indonesia
- Chettinad Cement Corporation Ltd - India
- Medco Energi Mining Internasional
- Straits Asia Resources Limited - Singapore
- Agrawal Coal Company - India
- Uttam Galva Steels Limited - India
- Dalmia Cement Bharat India
- Pipit Mutiara Jaya. PT, Indonesia
- Orica Mining Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Directorate General of MIneral and Coal - Indonesia
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- ICICI Bank Limited - India
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Planning Commission, India
- Georgia Ports Authority, United States
- CNBM International Corporation - China
- Star Paper Mills Limited - India
- LBH Netherlands Bv - Netherlands
- Edison Trading Spa - Italy
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Oldendorff Carriers - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- PNOC Exploration Corporation - Philippines
- Lanco Infratech Ltd - India
- Ministry of Finance - Indonesia
- Baramulti Group, Indonesia
- Chamber of Mines of South Africa
- Grasim Industreis Ltd - India
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