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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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Monday, 12 January 15
SHIPPING - CHALLENGES AND RESOLUTIONS - EVA TZIMA
Last year has without a doubt been another challenging one both for both our industry and our country. As Greece is currently dominated by election ...
Sunday, 11 January 15
BDI DECLINED 8% ON WEEK; BCI LOST 31%
COALspot.com: The BDI continued its decline in the first week of this year or lost 8 pct week over week. The BDI was closed at 709 points whi ...
Friday, 09 January 15
U.S. EASTERN SPOT STEAM COAL PRICES FELL IN 2014; ROSE IN WEST - EIA
U.S. Eastern spot steam coal prices declined in 2014 compared to 2013 levels because of a decline in steam coal exports.
According to U.S. Ene ...
Friday, 09 January 15
WEEKLY U.S. COAL PRODUCTION UP AN ESTIMATED 2.2% Y-O-Y
COALspot.com – United States the world's one of the largest coal producers, produced approximately 17.6 million short tons (mmst) of coal ...
Thursday, 08 January 15
INDONESIA PRESSES ON WITH HIGHER COAL ROYALTY FEE TO BOOST STATE REVENUE - JG
The Indonesian government is pressing on with its plan to raise the royalty charged to coal miners in order to increase state revenue, but the move ...
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- GAC Shipping (India) Pvt Ltd
- Wilmar Investment Holdings
- GMR Energy Limited - India
- Indo Tambangraya Megah - Indonesia
- Kumho Petrochemical, South Korea
- IHS Mccloskey Coal Group - USA
- GVK Power & Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- Parry Sugars Refinery, India
- Mintek Dendrill Indonesia
- International Coal Ventures Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Coal and Oil Company - UAE
- Coastal Gujarat Power Limited - India
- Global Business Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Timah Investasi Mineral - Indoneisa
- Iligan Light & Power Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercator Lines Limited - India
- Siam City Cement - Thailand
- Siam City Cement PLC, Thailand
- Posco Energy - South Korea
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Lanco Infratech Ltd - India
- The University of Queensland
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- Kartika Selabumi Mining - Indonesia
- Ministry of Finance - Indonesia
- Meralco Power Generation, Philippines
- Meenaskhi Energy Private Limited - India
- White Energy Company Limited
- Trasteel International SA, Italy
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Global Coal Blending Company Limited - Australia
- Economic Council, Georgia
- Antam Resourcindo - Indonesia
- TeaM Sual Corporation - Philippines
- Ministry of Transport, Egypt
- Bhushan Steel Limited - India
- VISA Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Medco Energi Mining Internasional
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Tata Chemicals Ltd - India
- Kobexindo Tractors - Indoneisa
- Petron Corporation, Philippines
- Jindal Steel & Power Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Larsen & Toubro Limited - India
- Agrawal Coal Company - India
- Rio Tinto Coal - Australia
- Barasentosa Lestari - Indonesia
- Pendopo Energi Batubara - Indonesia
- Binh Thuan Hamico - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- Samtan Co., Ltd - South Korea
- Australian Coal Association
- Power Finance Corporation Ltd., India
- Ministry of Mines - Canada
- Holcim Trading Pte Ltd - Singapore
- Port Waratah Coal Services - Australia
- Cement Manufacturers Association - India
- Sinarmas Energy and Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Indonesian Coal Mining Association
- Directorate Of Revenue Intelligence - India
- Commonwealth Bank - Australia
- Videocon Industries ltd - India
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- SMC Global Power, Philippines
- Wood Mackenzie - Singapore
- Bukit Baiduri Energy - Indonesia
- PTC India Limited - India
- PNOC Exploration Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Sidhee Cement - India
- New Zealand Coal & Carbon
- Georgia Ports Authority, United States
- Kalimantan Lumbung Energi - Indonesia
- Energy Link Ltd, New Zealand
- Essar Steel Hazira Ltd - India
- Kaltim Prima Coal - Indonesia
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Indian Oil Corporation Limited
- Ambuja Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Star Paper Mills Limited - India
- Price Waterhouse Coopers - Russia
- PetroVietnam Power Coal Import and Supply Company
- Bhatia International Limited - India
- Malabar Cements Ltd - India
- McConnell Dowell - Australia
- Salva Resources Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- London Commodity Brokers - England
- Dalmia Cement Bharat India
- Anglo American - United Kingdom
- Makarim & Taira - Indonesia
- Xindia Steels Limited - India
- Electricity Authority, New Zealand
- Coalindo Energy - Indonesia
- Thai Mozambique Logistica
- Vedanta Resources Plc - India
- Chamber of Mines of South Africa
- Ind-Barath Power Infra Limited - India
- MS Steel International - UAE
- Orica Australia Pty. Ltd.
- Latin American Coal - Colombia
- Jorong Barutama Greston.PT - Indonesia
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- Central Java Power - Indonesia
- Intertek Mineral Services - Indonesia
- Altura Mining Limited, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Globalindo Alam Lestari - Indonesia
- Tamil Nadu electricity Board
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Rashtriya Ispat Nigam Limited - India
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Sarangani Energy Corporation, Philippines
- ASAPP Information Group - India
- Singapore Mercantile Exchange
- San Jose City I Power Corp, Philippines
- Goldman Sachs - Singapore
- The Treasury - Australian Government
- Sical Logistics Limited - India
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- Bukit Makmur.PT - Indonesia
- Interocean Group of Companies - India
- Marubeni Corporation - India
- The State Trading Corporation of India Ltd
- SN Aboitiz Power Inc, Philippines
- Bangladesh Power Developement Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- SMG Consultants - Indonesia
- Edison Trading Spa - Italy
- Bhoruka Overseas - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Planning Commission, India
- Electricity Generating Authority of Thailand
- Standard Chartered Bank - UAE
- Indogreen Group - Indonesia
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- India Bulls Power Limited - India
- Sakthi Sugars Limited - India
- Jaiprakash Power Ventures ltd
- South Luzon Thermal Energy Corporation
- Riau Bara Harum - Indonesia
- Uttam Galva Steels Limited - India
- Mjunction Services Limited - India
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- IEA Clean Coal Centre - UK
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Eastern Energy - Thailand
- Kideco Jaya Agung - Indonesia
- Minerals Council of Australia
- CNBM International Corporation - China
- Leighton Contractors Pty Ltd - Australia
- Oldendorff Carriers - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Neyveli Lignite Corporation Ltd, - India
- Indian Energy Exchange, India
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Formosa Plastics Group - Taiwan
- European Bulk Services B.V. - Netherlands
- Sree Jayajothi Cements Limited - India
- Grasim Industreis Ltd - India
- Deloitte Consulting - India
- LBH Netherlands Bv - Netherlands
- Aboitiz Power Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Orica Mining Services - Indonesia
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Renaissance Capital - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Aditya Birla Group - India
- Toyota Tsusho Corporation, Japan
- Chettinad Cement Corporation Ltd - India
- Semirara Mining Corp, Philippines
- CIMB Investment Bank - Malaysia
- Kapuas Tunggal Persada - Indonesia
- Madhucon Powers Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- Vizag Seaport Private Limited - India
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