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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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- Sojitz Corporation - Japan
- Semirara Mining and Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Sree Jayajothi Cements Limited - India
- Holcim Trading Pte Ltd - Singapore
- International Coal Ventures Pvt Ltd - India
- Ambuja Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
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- Ind-Barath Power Infra Limited - India
- Attock Cement Pakistan Limited
- Intertek Mineral Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Uttam Galva Steels Limited - India
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- AsiaOL BioFuels Corp., Philippines
- GAC Shipping (India) Pvt Ltd
- Timah Investasi Mineral - Indoneisa
- Sarangani Energy Corporation, Philippines
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- Formosa Plastics Group - Taiwan
- Binh Thuan Hamico - Vietnam
- Chamber of Mines of South Africa
- Central Java Power - Indonesia
- Parry Sugars Refinery, India
- Globalindo Alam Lestari - Indonesia
- Meralco Power Generation, Philippines
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Deloitte Consulting - India
- Electricity Authority, New Zealand
- Riau Bara Harum - Indonesia
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Kohat Cement Company Ltd. - Pakistan
- PTC India Limited - India
- Karbindo Abesyapradhi - Indoneisa
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Indonesian Coal Mining Association
- Star Paper Mills Limited - India
- Siam City Cement PLC, Thailand
- Minerals Council of Australia
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Independent Power Producers Association of India
- Indian Energy Exchange, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asmin Koalindo Tuhup - Indonesia
- Kepco SPC Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- GVK Power & Infra Limited - India
- SMG Consultants - Indonesia
- Bharathi Cement Corporation - India
- Ministry of Finance - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Bhushan Steel Limited - India
- Planning Commission, India
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement - Thailand
- Kobexindo Tractors - Indoneisa
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- Straits Asia Resources Limited - Singapore
- Bukit Makmur.PT - Indonesia
- Global Business Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Borneo Indobara - Indonesia
- Grasim Industreis Ltd - India
- Parliament of New Zealand
- Savvy Resources Ltd - HongKong
- Barasentosa Lestari - Indonesia
- IEA Clean Coal Centre - UK
- Bank of Tokyo Mitsubishi UFJ Ltd
- Samtan Co., Ltd - South Korea
- Banpu Public Company Limited - Thailand
- Karaikal Port Pvt Ltd - India
- Trasteel International SA, Italy
- Commonwealth Bank - Australia
- Lanco Infratech Ltd - India
- Dalmia Cement Bharat India
- Eastern Coal Council - USA
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- Central Electricity Authority - India
- Mercator Lines Limited - India
- Chettinad Cement Corporation Ltd - India
- Ministry of Mines - Canada
- PowerSource Philippines DevCo
- Sinarmas Energy and Mining - Indonesia
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- Price Waterhouse Coopers - Russia
- Latin American Coal - Colombia
- McConnell Dowell - Australia
- Altura Mining Limited, Indonesia
- Agrawal Coal Company - India
- PetroVietnam Power Coal Import and Supply Company
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- Orica Australia Pty. Ltd.
- Romanian Commodities Exchange
- Iligan Light & Power Inc, Philippines
- Petron Corporation, Philippines
- Medco Energi Mining Internasional
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- Metalloyd Limited - United Kingdom
- London Commodity Brokers - England
- Energy Link Ltd, New Zealand
- Sical Logistics Limited - India
- Mercuria Energy - Indonesia
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- Therma Luzon, Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- South Luzon Thermal Energy Corporation
- Kapuas Tunggal Persada - Indonesia
- Global Green Power PLC Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Malabar Cements Ltd - India
- PNOC Exploration Corporation - Philippines
- Australian Commodity Traders Exchange
- Neyveli Lignite Corporation Ltd, - India
- Aditya Birla Group - India
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- Australian Coal Association
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- TNB Fuel Sdn Bhd - Malaysia
- Tata Chemicals Ltd - India
- Power Finance Corporation Ltd., India
- Sindya Power Generating Company Private Ltd
- ASAPP Information Group - India
- Vijayanagar Sugar Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Orica Mining Services - Indonesia
- Eastern Energy - Thailand
- Posco Energy - South Korea
- ICICI Bank Limited - India
- Marubeni Corporation - India
- Bayan Resources Tbk. - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The University of Queensland
- Manunggal Multi Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- OPG Power Generation Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Kideco Jaya Agung - Indonesia
- SMC Global Power, Philippines
- Kartika Selabumi Mining - Indonesia
- Simpson Spence & Young - Indonesia
- CIMB Investment Bank - Malaysia
- Indogreen Group - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Wood Mackenzie - Singapore
- Sakthi Sugars Limited - India
- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Interocean Group of Companies - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Baramulti Group, Indonesia
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thai Mozambique Logistica
- Bhatia International Limited - India
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- Wilmar Investment Holdings
- CNBM International Corporation - China
- Vizag Seaport Private Limited - India
- Renaissance Capital - South Africa
- The Treasury - Australian Government
- Indo Tambangraya Megah - Indonesia
- Thiess Contractors Indonesia
- Bulk Trading Sa - Switzerland
- GMR Energy Limited - India
- Makarim & Taira - Indonesia
- Economic Council, Georgia
- Maharashtra Electricity Regulatory Commission - India
- Ceylon Electricity Board - Sri Lanka
- Toyota Tsusho Corporation, Japan
- Pendopo Energi Batubara - Indonesia
- Aboitiz Power Corporation - Philippines
- Ministry of Transport, Egypt
- India Bulls Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
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