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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 $2,839 at 2014H1 bunker prices”.
Poten added that “in order to improve TCE, owners have made operational adjustments by slow steaming during the ballast leg of the voyages, and during the laden leg where it was permitted in the charter party. This helps the owners by improving the economics on individual voyages as the fuel cost savings more than offset the longer steaming time when the market is low. An added benefit is that slow steaming reduces the efficiency or the fleet as more vessels are needed to move the same volume of cargo. Earlier in the year, when the rates were lower, slow steaming made more sense as the additional revenue that could be earned during the additional 3.9 ballasting days was lower than the fuel savings. At current market rates and lower bunker prices, this situation has shifted. At least for the vessel and voyage combination in our example, increasing the ballast speed could prove to be beneficial. The situation could be different for other vessels and voyages, but it makes the case for owners to run the numbers. The benefits of fuel efficient designs might have been reduced for now but the investment is for 20+ years and fuel prices are likely to increase again in the future”, the analyst concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Tuesday, 13 January 15
MORE PITFALLS FOR OWNERS LOOKING TO TERMINATE FOR UNPAID HIRE - INCE & CO
KNOWLEDGE TO ELEVATE
It is a debatable point whether or not the obligation to pay hire under a time charter is a condition of the contract or ...
Tuesday, 13 January 15
Q2 CFR SOUTH CHINA COAL SWAP DECLINED 8.66% M-O-M
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2015 delivery declined by US$ 3.48 (-5.73%) month over month and US$ 2.35 (-3.94%) week ...
Tuesday, 13 January 15
Q1' 2015 RICHARDS BAY COAL SWAP SLIGHTLY HIGHER THAN Q2 & Q4 2015 SWAPS
COALspot.com: API 4 FOB Richards Bay Coal swap for delivery Q1' 2015 lost month on month and week over week.
The Q1 swap has lost US$ 7.21 ...
Monday, 12 January 15
COAL: LOW PRICES ARE EXPECTED TO DRIVE A SUPPLY-DRIVEN RECOVERY IN THE MEDIUM TERM - SGX
COALspot.com: Thermal coal prices dropped to six-year lows in 2014 driven by persistent oversupply, SGX says in its “ Commodities 2014 - A ye ...
Monday, 12 January 15
FREIGHT MARKET: 2015 FLEET SUPPLY GROWTH IS EXPECTED TO REMAIN SLIGHTLY AHEAD OF CARGO GROWTH - SGX
COALspot.com: The dry bulk freight market was forced to digest a number of negatives in 2014 leading the Baltic Dry Index to fall 66% through the y ...
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- Petrochimia International Co. Ltd.- Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Sidhee Cement - India
- GAC Shipping (India) Pvt Ltd
- Tata Chemicals Ltd - India
- SN Aboitiz Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Renaissance Capital - South Africa
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- Kideco Jaya Agung - Indonesia
- Formosa Plastics Group - Taiwan
- Manunggal Multi Energi - Indonesia
- Thai Mozambique Logistica
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- Singapore Mercantile Exchange
- Baramulti Group, Indonesia
- Toyota Tsusho Corporation, Japan
- Siam City Cement - Thailand
- Merrill Lynch Commodities Europe
- Antam Resourcindo - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Grasim Industreis Ltd - India
- Chettinad Cement Corporation Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- Coal and Oil Company - UAE
- Global Business Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Oldendorff Carriers - Singapore
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- Xindia Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Port Waratah Coal Services - Australia
- VISA Power Limited - India
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Parliament of New Zealand
- Carbofer General Trading SA - India
- GMR Energy Limited - India
- AsiaOL BioFuels Corp., Philippines
- Indika Energy - Indonesia
- Videocon Industries ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Malabar Cements Ltd - India
- Ministry of Finance - Indonesia
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- The State Trading Corporation of India Ltd
- Africa Commodities Group - South Africa
- Vizag Seaport Private Limited - India
- Bangladesh Power Developement Board
- Price Waterhouse Coopers - Russia
- Medco Energi Mining Internasional
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Makarim & Taira - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aditya Birla Group - India
- LBH Netherlands Bv - Netherlands
- TNB Fuel Sdn Bhd - Malaysia
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
- Georgia Ports Authority, United States
- Rio Tinto Coal - Australia
- CNBM International Corporation - China
- Timah Investasi Mineral - Indoneisa
- Indogreen Group - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Independent Power Producers Association of India
- Miang Besar Coal Terminal - Indonesia
- MS Steel International - UAE
- Commonwealth Bank - Australia
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- Global Coal Blending Company Limited - Australia
- Maheswari Brothers Coal Limited - India
- Agrawal Coal Company - India
- Mercuria Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indonesian Coal Mining Association
- Electricity Generating Authority of Thailand
- OPG Power Generation Pvt Ltd - India
- Sojitz Corporation - Japan
- Bulk Trading Sa - Switzerland
- Essar Steel Hazira Ltd - India
- Kepco SPC Power Corporation, Philippines
- Parry Sugars Refinery, India
- Mintek Dendrill Indonesia
- CIMB Investment Bank - Malaysia
- Uttam Galva Steels Limited - India
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Australian Coal Association
- TeaM Sual Corporation - Philippines
- Interocean Group of Companies - India
- Romanian Commodities Exchange
- Altura Mining Limited, Indonesia
- Salva Resources Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- European Bulk Services B.V. - Netherlands
- Bahari Cakrawala Sebuku - Indonesia
- Cigading International Bulk Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Central Java Power - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Simpson Spence & Young - Indonesia
- Meralco Power Generation, Philippines
- Minerals Council of Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Maharashtra Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chamber of Mines of South Africa
- ASAPP Information Group - India
- Bhatia International Limited - India
- Anglo American - United Kingdom
- Indian Energy Exchange, India
- Kobexindo Tractors - Indoneisa
- White Energy Company Limited
- SMG Consultants - Indonesia
- Mercator Lines Limited - India
- Bukit Baiduri Energy - Indonesia
- India Bulls Power Limited - India
- South Luzon Thermal Energy Corporation
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Aboitiz Power Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Power Finance Corporation Ltd., India
- The University of Queensland
- Bhoruka Overseas - Indonesia
- Coastal Gujarat Power Limited - India
- New Zealand Coal & Carbon
- Barasentosa Lestari - Indonesia
- Borneo Indobara - Indonesia
- Ministry of Mines - Canada
- Eastern Energy - Thailand
- Sakthi Sugars Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Star Paper Mills Limited - India
- Electricity Authority, New Zealand
- Larsen & Toubro Limited - India
- PowerSource Philippines DevCo
- Madhucon Powers Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- The Treasury - Australian Government
- Therma Luzon, Inc, Philippines
- Jaiprakash Power Ventures ltd
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- Intertek Mineral Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Binh Thuan Hamico - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Sical Logistics Limited - India
- Goldman Sachs - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wilmar Investment Holdings
- Global Green Power PLC Corporation, Philippines
- Latin American Coal - Colombia
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- PTC India Limited - India
- Thiess Contractors Indonesia
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- Edison Trading Spa - Italy
- Planning Commission, India
- Eastern Coal Council - USA
- Cement Manufacturers Association - India
- Banpu Public Company Limited - Thailand
- SMC Global Power, Philippines
- PNOC Exploration Corporation - Philippines
- IEA Clean Coal Centre - UK
- Central Electricity Authority - India
- Semirara Mining Corp, Philippines
- Marubeni Corporation - India
- Straits Asia Resources Limited - Singapore
- Jindal Steel & Power Ltd - India
- International Coal Ventures Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Electricity Regulatory Commission - India
- Deloitte Consulting - India
- Jorong Barutama Greston.PT - Indonesia
- Posco Energy - South Korea
- Ministry of Transport, Egypt
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- Australian Commodity Traders Exchange
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