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.
|
|
Tuesday, 08 September 15
FOB RICHARDS BAY COAL SWAPS CONTINUE TO SHOW DECLINING TREND
COALspot.com: API4 FOB Richards Bay Coal swap for delivery 4Q' 2015 declined week over week and month over month.
The 4Q swap was down US$ ...
Tuesday, 08 September 15
GANGAVARAM PORT IN INDIA DISCHARGES RECORD 112,599 MT OF STEAM COAL IN 24 HOURS
COALspot.com: Gangavaram Port, an all weather, multipurpose port with water depth up-to 21 meters, capable of handling fully laden Super Cap ...
Monday, 07 September 15
THE MINE OF THE FUTURE WILL HAVE ONLY TWO EMPLOYEES, A MAN AND A DOG - SCOTT MCGOWAN
"The Technology and Innovation in Mining 2015" production team at Information Exchange Group interviewed Scott Mcgowan, Director, Global ...
Monday, 07 September 15
FOB NEWCASTLE COAL SWAP FOR Q2' 16 DELIVERY CLOSED US CENTS 25 LOWER COMPARED TO Q4' 15
COALspot.com: API 5 FOB Newcastle Coal swap for 4Q’ 2015 delivery declined $0.73 per MT (-1.68%) month over month to US$ 42.65 per mt. The sw ...
Monday, 07 September 15
CFR SOUTH CHINA COAL SWAPS ROSE 1.1 PER CENT WEEK OVER WEEK
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery declined just US$ 1.52 (3 %) per MT month over month.
A commodity sw ...
|
|
|
Showing 2826 to 2830 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Commonwealth Bank - Australia
- Medco Energi Mining Internasional
- Chamber of Mines of South Africa
- Mintek Dendrill Indonesia
- Mercuria Energy - Indonesia
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- Latin American Coal - Colombia
- Bukit Makmur.PT - Indonesia
- Ministry of Transport, Egypt
- Global Green Power PLC Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Orica Australia Pty. Ltd.
- Siam City Cement PLC, Thailand
- CNBM International Corporation - China
- Marubeni Corporation - India
- GAC Shipping (India) Pvt Ltd
- Semirara Mining Corp, Philippines
- Baramulti Group, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- Power Finance Corporation Ltd., India
- Sree Jayajothi Cements Limited - India
- Timah Investasi Mineral - Indoneisa
- Goldman Sachs - Singapore
- Kumho Petrochemical, South Korea
- PTC India Limited - India
- Ministry of Mines - Canada
- Australian Coal Association
- Jaiprakash Power Ventures ltd
- Global Business Power Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Vizag Seaport Private Limited - India
- McConnell Dowell - Australia
- Manunggal Multi Energi - Indonesia
- Standard Chartered Bank - UAE
- Sical Logistics Limited - India
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Kapuas Tunggal Persada - Indonesia
- Meralco Power Generation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ICICI Bank Limited - India
- Mercator Lines Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- Gujarat Sidhee Cement - India
- Borneo Indobara - Indonesia
- Grasim Industreis Ltd - India
- Tata Chemicals Ltd - India
- PowerSource Philippines DevCo
- Antam Resourcindo - Indonesia
- PNOC Exploration Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Port Waratah Coal Services - Australia
- Australian Commodity Traders Exchange
- LBH Netherlands Bv - Netherlands
- Ind-Barath Power Infra Limited - India
- The University of Queensland
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Videocon Industries ltd - India
- Indogreen Group - Indonesia
- Parry Sugars Refinery, India
- Straits Asia Resources Limited - Singapore
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Attock Cement Pakistan Limited
- Chettinad Cement Corporation Ltd - India
- Xindia Steels Limited - India
- The Treasury - Australian Government
- Karbindo Abesyapradhi - Indoneisa
- Minerals Council of Australia
- SN Aboitiz Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Sojitz Corporation - Japan
- Pendopo Energi Batubara - Indonesia
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Romanian Commodities Exchange
- Petron Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cement Manufacturers Association - India
- Karaikal Port Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Indonesian Coal Mining Association
- Planning Commission, India
- Simpson Spence & Young - Indonesia
- Savvy Resources Ltd - HongKong
- Banpu Public Company Limited - Thailand
- Interocean Group of Companies - India
- Madhucon Powers Ltd - India
- GVK Power & Infra Limited - India
- IEA Clean Coal Centre - UK
- Bulk Trading Sa - Switzerland
- Kobexindo Tractors - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- Globalindo Alam Lestari - Indonesia
- Electricity Authority, New Zealand
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Gujarat Electricity Regulatory Commission - India
- Singapore Mercantile Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Oldendorff Carriers - Singapore
- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Bhatia International Limited - India
- OPG Power Generation Pvt Ltd - India
- SMG Consultants - Indonesia
- Mjunction Services Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- Africa Commodities Group - South Africa
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- AsiaOL BioFuels Corp., Philippines
- Indika Energy - Indonesia
- Coal and Oil Company - UAE
- Eastern Energy - Thailand
- Riau Bara Harum - Indonesia
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Sarangani Energy Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- TeaM Sual Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Sinarmas Energy and Mining - Indonesia
- Energy Development Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Bhoruka Overseas - Indonesia
- Agrawal Coal Company - India
- Essar Steel Hazira Ltd - India
- Aditya Birla Group - India
- Rio Tinto Coal - Australia
- Makarim & Taira - Indonesia
- Georgia Ports Authority, United States
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Renaissance Capital - South Africa
- Holcim Trading Pte Ltd - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Vijayanagar Sugar Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Rashtriya Ispat Nigam Limited - India
- Bayan Resources Tbk. - Indonesia
- Directorate Of Revenue Intelligence - India
- Samtan Co., Ltd - South Korea
- Kepco SPC Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Anglo American - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Bangladesh Power Developement Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- India Bulls Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Independent Power Producers Association of India
- Semirara Mining and Power Corporation, Philippines
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Maharashtra Electricity Regulatory Commission - India
- Directorate General of MIneral and Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Malabar Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- Orica Mining Services - Indonesia
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- Siam City Cement - Thailand
- IHS Mccloskey Coal Group - USA
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- Kaltim Prima Coal - Indonesia
- GMR Energy Limited - India
- Economic Council, Georgia
- European Bulk Services B.V. - Netherlands
- Lanco Infratech Ltd - India
- Central Electricity Authority - India
- Neyveli Lignite Corporation Ltd, - India
- Heidelberg Cement - Germany
- Formosa Plastics Group - Taiwan
- White Energy Company Limited
- Central Java Power - Indonesia
- Bharathi Cement Corporation - India
- Global Coal Blending Company Limited - Australia
- Star Paper Mills Limited - India
- Posco Energy - South Korea
|
| |
| |
|
