We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Sunday, 11 October 15
TANKER SHIPPING: MORE OPTIMISM IN SIGHT FOR TANKERS IN THE WINTER SEASON - BIMCO
 Demand:
2015 has been the year of the tanker. The fundamental improvements with slow supply-side growth for some years coupled with low oil prices from mid-2014 created strength on both sides. Freight rates started to take off in October 2014 for all types and sizes. The combination of an early start to the fourth-quarter seasonal strength heading into winter and the fact that the oil prices continued to slide became a catalyst.
Throughout 2015, the global refinery throughput has been on a rise. The normal seasonal lower throughput in the first half of the year with widespread maintenance did not occur. Owing to rising and already elevated refinery margins from East to West, refineries simply wanted all the crude oil they could get. This development still provides strong demand and solid freight rates for the tanker industry. In India, we saw a record of 4.74 million barrels per day (mb/d) of crude throughput in June, marking a truly global trend, whereas Middle Eastern refineries also hit a record throughput because of increased runs in Saudi Arabia.
October is traditionally another month of lower throughput as refineries get ready for the winter season when crude runs normally peak. Moreover, the American “Labor Day” on 7 September marks the end of the US driving season which started on Memorial Day, 25 May. This means that the recent 10mb/d production of gasoline will come down.
Some of that weakness may already have caused freight rates to come down sharply, in combination with the global financial uncertainties originating from China. Very large crude Carriers (VLCCs), Suezmax and Aframax have seen freight rates cut in two since mid-June, while Handysize has been the one to drop the most among oil product tankers.
In a rush of excitement, it’s easily forgotten that such high refinery crude runs can only go on for so long, if end consumption supports it. End consumption has supported it some of the way but not all the way. Swollen stocks of crude oil and oil products are now seen everywhere. Preliminary OECD total industry stock change in second-quarter was 1.1mb/d. All stocks but gasoline increased, US crude oil stocks too. In comparison global oil demand dropped by 0.1mb/d over the same period of time and is expected to see an increase of 1.6mb/d to be consumed for the full year over 2014.
Supply:
Contrary to what happens too often, the strong freight markets for oil product tankers have not resulted in a knee-jerk run to the shipyard to order a massive amount of new ships. This stands in opposition to the crude oil tanker orders seen in 2015, as if the lid has come off finally after several years of resisting the temptation.
By end-August 2015, 56 product tankers with a total capacity of 4.8 million DWT, predominantly LR2 (20) and LR1 (21), have been ordered and will be delivered in 2016-17. They are aiming to get a share of the market for longer-haul trades out of Middle East refineries, predominantly into the Western markets. This ordering trend has been on for two years now.
Among the crude oil tanker segments, we have already seen more orders for both Aframax and VLCCs than we did in the whole of 2014. Aframax in particular has been popular with investors this year; after six years with one order a month on average, 2015 has seen 29 new contracts in the first eight months. For the VLCCs, the orders with delivery in particular 2017 (21) and in 2018 (14) have been favoured by investors. In 2015, 50 new VLCC contracts in total have been signed.
One of the launchers which has lifted the freight rates into orbit is two years of very slow fleet growth. Today the fleet holds 648 VLCCs, whereas 628 VLCCs were active by mid-2013. That’s a growth of just 3% in 26 months. Looking forward into the future inflow of crude oil tankers, we can see the delivery pace is picking up and the demolition potential is vanishing with just 14 VLCCs being more than 20 years old and another 16 getting inside the window of the fourth special survey in 2016.
On order for a scheduled delivery during the next 16 months are 71 VLCCs. This means a double-paced inflow as it has taken 34 months for the latest 71 VLCCs to be put into active service.
The change in supply-side conditions will slowly tighten the freight market, and as we look into 2016, the tide could turn fundamentally as a fleet growth of 4.4% is likely to outstrip demand growth. As the coming two years are now “full” in terms of remaining in control of supply-side growth, any additional crude oil tanker orders should be placed for 2018 delivery.
BIMCO forecasts the present and next year supply growth for oil product tankers to be at 5.4% and 5.7% respectively, meaning two “full” years too for that segment.
Outlook:
Looking forward, the winter markets are expected to soften, as the eventual lower refinery crude oil throughput when no more stocks can be filled and margins begin to crumble as demand slips. Until then BIMCO expects earnings for both crude oil and oil product tankers to remain strong. Our expectations are primarily supported by low fleet growth for crude oil tankers and long-haul trades for oil product tankers.
High volatility in freight rates can be expected in the coming half year half a year, when it may also be prudent to look at the time charter market, where one- and three-year time charter rates are both at their highest level since 2009. At USD 48,000 per day and USD 43,500 per day, time charters will make positive returns after all costs inclusive of capital cost and depreciations are deducted.
In the longer run, an eventual repeal of the US crude oil export ban will likely have some impact on the tanker trading lanes. The US congress is set to vote on the issues during this autumn. For the supporters the case is clear: US refineries are saturated with light sweet crude which is produced abundantly. For those in favour of keeping the crude oil export ban still in place there is “national interest”, which currently seems to hold the upper hand. Currently, the only crude oil exports today go to Canada (0.5mb/d).
Moreover, the eventual lifting of international sanctions on Iran is likely to see a steady increase in crude oil, both sweet and sour, into the market over the coming one to three years, depending on much-needed investments to boost production and time to regain market shares. BIMCO expects the re-entry of Iranian crude oil into the market will change trade patterns as other suppliers will be squeezed on their market share. The key will be West African produced sweet crude now going to Europe and East Asia. The latter is the vital one and a stronghold behind the current upturn. The overall impact on the tanker earnings from these changes holds the potential to become both negative and positive.
Source: BIMCO | Hellenic Shipping News
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Monday, 12 October 15
DRY BULK SHIPPING: MARKETS ARE SLOWLY IMPROVING FROM A VERY LOW LEVEL AS THE DEMAND SIDE FALTERS - HELLENIC SHIPPING NEWS
The dry bulk market is in the midst of a shift in demand patterns, which coupled with a tonnage supply overhang, has been facing headwinds over the ...
Monday, 12 October 15
BDI WEIGHED DOWN BY CAPE
COALspot.com: The BDI (Baltic Dry Index) has come back down again this week. The BDI is a benchmark index used to assess the overall cost of moving ...
Friday, 09 October 15
US WEEKLY COAL OUTPUT UP 1.2 PERCENT TO 17.7 MMST
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 17.7 million shor ...
Thursday, 08 October 15
CAPESIZE: MOST PEOPLE AGREE A SPIKE IN RATES WILL HAPPEN; WHEN, HOW LONG AND HOW SUBSTANTIAL? - FEARNLEYS
Cape
Depressives start of the fourth quarter, with c3 approaching USD 12 pmt and c5 presently in the mind 5's. According to Fearnleys ship br ...
Wednesday, 07 October 15
U.S. COAL EXPORTS FOR THE FIRST SEVEN MONTHS DOWN 21 PER CENT COMPARED WITH THE SAME PERIOD IN 2014 - EIA
Coal Supply
Lower U.S.’s domestic coal consumption and reduced exports contribute to a forecast decline of 89 million short tons (M ...
|
|
|
Showing 2776 to 2780 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Billiton Holdings Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Thiess Contractors Indonesia
- Semirara Mining Corp, Philippines
- Central Electricity Authority - India
- Sindya Power Generating Company Private Ltd
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- Coalindo Energy - Indonesia
- Borneo Indobara - Indonesia
- Kartika Selabumi Mining - Indonesia
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Kapuas Tunggal Persada - Indonesia
- Barasentosa Lestari - Indonesia
- Anglo American - United Kingdom
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- Aboitiz Power Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Siam City Cement - Thailand
- Star Paper Mills Limited - India
- Sakthi Sugars Limited - India
- Energy Link Ltd, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- CNBM International Corporation - China
- Maharashtra Electricity Regulatory Commission - India
- Attock Cement Pakistan Limited
- Uttam Galva Steels Limited - India
- Eastern Energy - Thailand
- Indogreen Group - Indonesia
- Australian Commodity Traders Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
- Deloitte Consulting - India
- Edison Trading Spa - Italy
- Chamber of Mines of South Africa
- Krishnapatnam Port Company Ltd. - India
- LBH Netherlands Bv - Netherlands
- PNOC Exploration Corporation - Philippines
- Meralco Power Generation, Philippines
- Central Java Power - Indonesia
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Metalloyd Limited - United Kingdom
- Carbofer General Trading SA - India
- Heidelberg Cement - Germany
- Globalindo Alam Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Global Business Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Agrawal Coal Company - India
- Oldendorff Carriers - Singapore
- Simpson Spence & Young - Indonesia
- The Treasury - Australian Government
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Bhatia International Limited - India
- Coastal Gujarat Power Limited - India
- Sical Logistics Limited - India
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Salva Resources Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- Indika Energy - Indonesia
- Parliament of New Zealand
- Trasteel International SA, Italy
- South Luzon Thermal Energy Corporation
- New Zealand Coal & Carbon
- Bahari Cakrawala Sebuku - Indonesia
- Rio Tinto Coal - Australia
- Port Waratah Coal Services - Australia
- Sojitz Corporation - Japan
- MS Steel International - UAE
- Price Waterhouse Coopers - Russia
- Meenaskhi Energy Private Limited - India
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- Gujarat Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- Ministry of Transport, Egypt
- Cement Manufacturers Association - India
- Ambuja Cements Ltd - India
- ASAPP Information Group - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMG Consultants - Indonesia
- Directorate Of Revenue Intelligence - India
- Banpu Public Company Limited - Thailand
- SMC Global Power, Philippines
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bukit Makmur.PT - Indonesia
- Savvy Resources Ltd - HongKong
- Timah Investasi Mineral - Indoneisa
- Dalmia Cement Bharat India
- Antam Resourcindo - Indonesia
- Vedanta Resources Plc - India
- Essar Steel Hazira Ltd - India
- Latin American Coal - Colombia
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- AsiaOL BioFuels Corp., Philippines
- Renaissance Capital - South Africa
- Asmin Koalindo Tuhup - Indonesia
- Romanian Commodities Exchange
- Directorate General of MIneral and Coal - Indonesia
- Merrill Lynch Commodities Europe
- Aditya Birla Group - India
- Rashtriya Ispat Nigam Limited - India
- San Jose City I Power Corp, Philippines
- Marubeni Corporation - India
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Interocean Group of Companies - India
- Kumho Petrochemical, South Korea
- Straits Asia Resources Limited - Singapore
- ICICI Bank Limited - India
- Mintek Dendrill Indonesia
- Chettinad Cement Corporation Ltd - India
- Riau Bara Harum - Indonesia
- Kaltim Prima Coal - Indonesia
- Georgia Ports Authority, United States
- Karaikal Port Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Mineral Development Corp Ltd - India
- Iligan Light & Power Inc, Philippines
- Indonesian Coal Mining Association
- International Coal Ventures Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Goldman Sachs - Singapore
- Electricity Generating Authority of Thailand
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Manunggal Multi Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Orica Australia Pty. Ltd.
- VISA Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Xindia Steels Limited - India
- Economic Council, Georgia
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- The University of Queensland
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- Thai Mozambique Logistica
- PowerSource Philippines DevCo
- Jindal Steel & Power Ltd - India
- Electricity Authority, New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Independent Power Producers Association of India
- IHS Mccloskey Coal Group - USA
- Lanco Infratech Ltd - India
- SN Aboitiz Power Inc, Philippines
- Energy Development Corp, Philippines
- Bharathi Cement Corporation - India
- Indo Tambangraya Megah - Indonesia
- Cigading International Bulk Terminal - Indonesia
- GMR Energy Limited - India
- Indian Oil Corporation Limited
- McConnell Dowell - Australia
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- Minerals Council of Australia
- Ministry of Mines - Canada
- Ceylon Electricity Board - Sri Lanka
- White Energy Company Limited
- Mercator Lines Limited - India
- Mjunction Services Limited - India
- Planning Commission, India
- Eastern Coal Council - USA
- Intertek Mineral Services - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Vijayanagar Sugar Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Grasim Industreis Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Holcim Trading Pte Ltd - Singapore
- Baramulti Group, Indonesia
- Australian Coal Association
- Bhushan Steel Limited - India
- Power Finance Corporation Ltd., India
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Wood Mackenzie - Singapore
- Binh Thuan Hamico - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement PLC, Thailand
- Singapore Mercantile Exchange
- Kideco Jaya Agung - Indonesia
- Makarim & Taira - Indonesia
- Wilmar Investment Holdings
- Africa Commodities Group - South Africa
|
| |
| |
|
