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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, 14 January 15
DRY BULK MARKET NOTED ANOTHER WEEKLY DECLINE - INTERMODAL
COALspot.com: The Dry bulk market noted another weekly decline on Friday, with the performance of the Capesize market still weighing down on the re ...
Wednesday, 14 January 15
MARKET INSIGHT - TIMOS PAPADIMITRIOU
In Oil we trust! The Barrel price has declined by almost a third in comparison to the 2014 January and has being on the downhill since early last s ...
Wednesday, 14 January 15
COMMODITIES AREN'T PRIMED FOR A REBOUND DURING 2015: SHIPPING COULD BENEFIT FROM LOWER PRICES - ROUSSANOGLOU, HELLENIC SHIPPING NEWS
In the recent past, higher commodity prices were driven by an increase in demand from developing countries, which spelled good news for ship owners ...
Wednesday, 14 January 15
SUB-BIT FOB INDONESIA COAL SWAP FOR Q1 DELIVERY CLOSED AT US$ 46.97 PMT
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 declined month on month and week over week.
The Q1 swap has fell US$ 1.53 (-3.15 ...
Wednesday, 14 January 15
Q4' 15 FOB NEWCASTLE COAL SWAP CLOSED 4.51% LOWER COMPARED TO Q1' 15 PRICE
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery lost US$ 1.56 per MT (-3.0%) month over month and US$ 1.03 (-2.0%) week ove ...
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- Energy Link Ltd, New Zealand
- Samtan Co., Ltd - South Korea
- Rashtriya Ispat Nigam Limited - India
- LBH Netherlands Bv - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Bhushan Steel Limited - India
- Thai Mozambique Logistica
- Petron Corporation, Philippines
- SMG Consultants - Indonesia
- Essar Steel Hazira Ltd - India
- Edison Trading Spa - Italy
- Uttam Galva Steels Limited - India
- Planning Commission, India
- GN Power Mariveles Coal Plant, Philippines
- Mercuria Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Kaltim Prima Coal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Bahari Cakrawala Sebuku - Indonesia
- Chamber of Mines of South Africa
- India Bulls Power Limited - India
- Maheswari Brothers Coal Limited - India
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- Straits Asia Resources Limited - Singapore
- Indonesian Coal Mining Association
- Chettinad Cement Corporation Ltd - India
- Australian Commodity Traders Exchange
- GAC Shipping (India) Pvt Ltd
- Coalindo Energy - Indonesia
- SMC Global Power, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Merrill Lynch Commodities Europe
- Bank of Tokyo Mitsubishi UFJ Ltd
- Marubeni Corporation - India
- Semirara Mining Corp, Philippines
- London Commodity Brokers - England
- Aditya Birla Group - India
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- Standard Chartered Bank - UAE
- Makarim & Taira - Indonesia
- Kepco SPC Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Ind-Barath Power Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- PTC India Limited - India
- Anglo American - United Kingdom
- Indika Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Leighton Contractors Pty Ltd - Australia
- White Energy Company Limited
- AsiaOL BioFuels Corp., Philippines
- Bhatia International Limited - India
- Xindia Steels Limited - India
- Eastern Energy - Thailand
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Manunggal Multi Energi - Indonesia
- Georgia Ports Authority, United States
- Bangladesh Power Developement Board
- Central Java Power - Indonesia
- IHS Mccloskey Coal Group - USA
- Economic Council, Georgia
- Trasteel International SA, Italy
- Bulk Trading Sa - Switzerland
- Tata Chemicals Ltd - India
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- Sindya Power Generating Company Private Ltd
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Global Coal Blending Company Limited - Australia
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- Jaiprakash Power Ventures ltd
- Bharathi Cement Corporation - India
- Orica Mining Services - Indonesia
- Dalmia Cement Bharat India
- Australian Coal Association
- Oldendorff Carriers - Singapore
- Gujarat Sidhee Cement - India
- CNBM International Corporation - China
- Iligan Light & Power Inc, Philippines
- Africa Commodities Group - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Central Electricity Authority - India
- Cement Manufacturers Association - India
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Goldman Sachs - Singapore
- Siam City Cement PLC, Thailand
- Salva Resources Pvt Ltd - India
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- ICICI Bank Limited - India
- New Zealand Coal & Carbon
- Power Finance Corporation Ltd., India
- San Jose City I Power Corp, Philippines
- Ministry of Finance - Indonesia
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- Alfred C Toepfer International GmbH - Germany
- Kapuas Tunggal Persada - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Meralco Power Generation, Philippines
- MS Steel International - UAE
- Commonwealth Bank - Australia
- CIMB Investment Bank - Malaysia
- TeaM Sual Corporation - Philippines
- Minerals Council of Australia
- Riau Bara Harum - Indonesia
- Ambuja Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Videocon Industries ltd - India
- Altura Mining Limited, Indonesia
- Sojitz Corporation - Japan
- Electricity Generating Authority of Thailand
- Krishnapatnam Port Company Ltd. - India
- Aboitiz Power Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Global Business Power Corporation, Philippines
- Mercator Lines Limited - India
- Parry Sugars Refinery, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Energy Development Corp, Philippines
- Sical Logistics Limited - India
- GMR Energy Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- The State Trading Corporation of India Ltd
- PowerSource Philippines DevCo
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- Deloitte Consulting - India
- Karaikal Port Pvt Ltd - India
- Indian Oil Corporation Limited
- Sree Jayajothi Cements Limited - India
- The University of Queensland
- Baramulti Group, Indonesia
- Bayan Resources Tbk. - Indonesia
- Medco Energi Mining Internasional
- Sinarmas Energy and Mining - Indonesia
- Vizag Seaport Private Limited - India
- Kartika Selabumi Mining - Indonesia
- Agrawal Coal Company - India
- Thiess Contractors Indonesia
- Latin American Coal - Colombia
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- Timah Investasi Mineral - Indoneisa
- Simpson Spence & Young - Indonesia
- Mjunction Services Limited - India
- Binh Thuan Hamico - Vietnam
- Grasim Industreis Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Ceylon Electricity Board - Sri Lanka
- ASAPP Information Group - India
- Kideco Jaya Agung - Indonesia
- European Bulk Services B.V. - Netherlands
- Intertek Mineral Services - Indonesia
- Renaissance Capital - South Africa
- Wilmar Investment Holdings
- Globalindo Alam Lestari - Indonesia
- Romanian Commodities Exchange
- Lanco Infratech Ltd - India
- Indian Energy Exchange, India
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- GVK Power & Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Star Paper Mills Limited - India
- Larsen & Toubro Limited - India
- Interocean Group of Companies - India
- Kumho Petrochemical, South Korea
- VISA Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- International Coal Ventures Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Barasentosa Lestari - Indonesia
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