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Friday, 08 May 20
LNG DEMAND FACED SEVERAL HEADWINDS IN THE FIRST QUARTER OF 2020 - GASLOG
 LNG demand faced several headwinds in the first quarter of 2020 including a warmer than average winter in the northern hemisphere, high inventory levels of natural gas and LNG in several of the largest end markets for LNG and the outbreak of COVID-19, the impact of which has had an uneven distribution around the world during the year to date. For example, Chinese demand was 15 million tonnes (“mt”) in the first quarter of 2020, a decrease of 5% over the first quarter of 2019, according to Poten, but apparent demand in April has increased year-on-year based on vessel tracking data, including several cargoes exported from the U.S., GasLog says in its latest financial report.
Gaslog further noted, meanwhile, demand from Northern Asia more broadly (Japan, China, South Korea and Taiwan) grew by approximately 1 mt in the first quarter or 3% year-over-year. In addition, demand from India grew by nearly 2 mt in the first quarter of 2020 (or 37%) as the country looked to take advantage of historically low gas prices, although apparent demand in April is likely to be lower year-on-year based on vessel tracking data. Finally, demand from Europe grew by over 4 mt (or 37%) as gas pricing favored coal-to-gas switching for power generation and LNG replaces indigenous gas production. In total, LNG demand was 98 mt in the first quarter of 2020, compared to 89 mt in the first quarter of 2019, or an increase of 10%.
Wood Mackenzie currently expects global LNG demand to grow 21 mt or 6% this year, slower than the 26 mt or 7% it anticipated earlier this year prior to the global outbreak of COVID-19. Nonetheless, the demand for LNG over the near-term continues to be uncertain as many LNG importing countries either continue to have in effect shelter-in-place orders which prevent the operation of businesses deemed to be “non-essential” or are in the early stages of reopening their economies. Consequently, measures of global economic activity have declined significantly from comparable periods in 2019. However, the longer-term outlook for LNG demand remains favorable with demand growth of 92 mt estimated over the 2019-2025 timeframe, or compound annual growth of approximately 4%, according to Wood Mackenzie.
According to GasLog's latest financial report, global LNG supply was approximately 98 mt in the first quarter of 2020, an increase of 10 mt over the first quarter of 2019 (or 11%), primarily due to new supply additions in the U.S. (Cameron T1 and T2, Freeport T1, T2 and T3 and Elba Island), according to estimates from Wood Mackenzie. LNG supply is estimated to grow by 22 mt this year as the third train of Cameron begins operations and recent capacity additions continue to increase production. Further ahead, approximately 97 mt of new LNG capacity is expected to begin production during 2021-2025. However, Wood Mackenzie expects the pace of new project sanctions to slow significantly in 2020 due to the uncertainties caused by the COVID-19 outbreak in long-term demand for LNG and low global energy prices, in particular crude oil prices due to oversupply following a collapse in oil demand due to the COVID-19 virus.
In the LNG shipping spot market, tri-fuel diesel electric vessel (“TFDE”) headline rates, as reported by Clarksons, averaged $57,000 per day in the first quarter of 2020, a decrease from the averages of $108,000 in the fourth quarter of 2019 and $59,500 in the first quarter of 2019. Headline spot rates for steam turbine propulsion (“Steam”) vessels averaged $40,000 per day in the first quarter of 2020, a decrease from the average of $78,000 per day in the fourth quarter of 2019 but approximately in line with the $39,000 per day observed in the first quarter of 2019. Slower than expected LNG demand growth due in part to the impact of COVID-19 (as detailed above), high global inventories of natural gas and LNG following a warmer than average winter in the Northern Hemisphere and limited opportunities for LNG arbitrage trading between Atlantic and Pacific basins impacted headline spot rates in the first quarter of 2020.
Clarksons currently assesses headline spot rates for TFDE and Steam LNG carriers at $32,500 per day and $23,000 per day, respectively. The COVID-19 outbreak has introduced significant uncertainty regarding demand for LNG, and consequently, demand for LNG shipping over the near term. The combined impact of the COVID-19 outbreak and normal seasonality may lead to greater volatility in spot rates and to lower utilization of vessels trading in the spot and short-term markets, in particular Steam vessels. In addition, global gas prices and gas price differentials remain near historic lows in the key markets of North Asia and Europe, limiting the opportunities for inter-basin arbitrage trading and likely reducing average voyage distances as well as potentially reducing global output of LNG over the near-term, particularly in the U.S., where a number of cargo deferrals and/or cancellations have been reported for this summer, said GasLog.
As of May 5, 2020, the orderbook totals 118 dedicated LNG carriers (>100,000 cbm), according to estimates from Poten, representing 22% of the on-the-water fleet. Of these, 74 vessels (or 63%) have multi-year charters. The pace of newbuild ordering has slowed significantly relative to 2018-19, with only 4 newbuildings ordered so far in 2020 and all of them ordered against multi-year contracts, an encouraging development for the future supply and demand balance of LNG carriers.
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Friday, 04 November 22
CHINA EXPANDS COAL TERM CONTRACTS TO ALL MINES TO STABILIZE MARKET - REUTERS
China has expanded long-term thermal coal supply contracts for 2023 to all coal mines and asked power utilities to source more of their demand thro ...
Thursday, 03 November 22
HANDYSIZE VALUES MOVING UP IN OCTOBER, WHILE LNG VALUES SKYROCKET - VESSELSVALUE
Handysize values have increased this month across most ages, following a period of decline. Values for generic 10 year old Handysizes have moved up ...
Thursday, 03 November 22
EUROPEAN GAS SUPPLY SURPLUS, NOVEMBER HBA DOWN TO US$ 308.2 PER TON - ESDM
European gas supply conditions have a major influence in determining fluctuations in the Reference Coal Price (HBA). The November 2022 HBA recorded ...
Wednesday, 02 November 22
MARKET INSIGHT - INTERMODAL
Only five weeks before western sanctions’ full effect, uncertainty over energy has markets and governments on the edge. What was initially th ...
Tuesday, 01 November 22
CHINA COAL TRADE DISRUPTED BY COVID OUTBREAKS AS WINTER LOOMS - REUTERS
China’s strict COVID-19 policy is constraining coal supplies and pushing up prices, industry officials and traders say, just weeks before the ...
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- Madhucon Powers Ltd - India
- Economic Council, Georgia
- Makarim & Taira - Indonesia
- Essar Steel Hazira Ltd - India
- Semirara Mining Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Standard Chartered Bank - UAE
- Jorong Barutama Greston.PT - Indonesia
- Merrill Lynch Commodities Europe
- Samtan Co., Ltd - South Korea
- Krishnapatnam Port Company Ltd. - India
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- Kapuas Tunggal Persada - Indonesia
- Electricity Authority, New Zealand
- Bharathi Cement Corporation - India
- Coastal Gujarat Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Uttam Galva Steels Limited - India
- Billiton Holdings Pty Ltd - Australia
- Maheswari Brothers Coal Limited - India
- Indika Energy - Indonesia
- Orica Mining Services - Indonesia
- Edison Trading Spa - Italy
- Kumho Petrochemical, South Korea
- PowerSource Philippines DevCo
- New Zealand Coal & Carbon
- McConnell Dowell - Australia
- Bhatia International Limited - India
- Marubeni Corporation - India
- Larsen & Toubro Limited - India
- The State Trading Corporation of India Ltd
- Goldman Sachs - Singapore
- Ministry of Finance - Indonesia
- Cement Manufacturers Association - India
- GMR Energy Limited - India
- Karaikal Port Pvt Ltd - India
- Georgia Ports Authority, United States
- Energy Development Corp, Philippines
- Siam City Cement PLC, Thailand
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- Star Paper Mills Limited - India
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Meralco Power Generation, Philippines
- IEA Clean Coal Centre - UK
- Port Waratah Coal Services - Australia
- Wilmar Investment Holdings
- Australian Commodity Traders Exchange
- ICICI Bank Limited - India
- Indonesian Coal Mining Association
- Indian Energy Exchange, India
- Sinarmas Energy and Mining - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- Leighton Contractors Pty Ltd - Australia
- Gujarat Electricity Regulatory Commission - India
- GAC Shipping (India) Pvt Ltd
- Aboitiz Power Corporation - Philippines
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Heidelberg Cement - Germany
- Coalindo Energy - Indonesia
- Tata Chemicals Ltd - India
- Kobexindo Tractors - Indoneisa
- Orica Australia Pty. Ltd.
- Borneo Indobara - Indonesia
- Meenaskhi Energy Private Limited - India
- GVK Power & Infra Limited - India
- Dalmia Cement Bharat India
- Mjunction Services Limited - India
- Mercuria Energy - Indonesia
- Tamil Nadu electricity Board
- Xindia Steels Limited - India
- Romanian Commodities Exchange
- Electricity Generating Authority of Thailand
- Singapore Mercantile Exchange
- Neyveli Lignite Corporation Ltd, - India
- Africa Commodities Group - South Africa
- Anglo American - United Kingdom
- Renaissance Capital - South Africa
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- Bhoruka Overseas - Indonesia
- Central Electricity Authority - India
- Baramulti Group, Indonesia
- Carbofer General Trading SA - India
- Minerals Council of Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- Trasteel International SA, Italy
- Jindal Steel & Power Ltd - India
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Eastern Coal Council - USA
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Globalindo Alam Lestari - Indonesia
- South Luzon Thermal Energy Corporation
- Thai Mozambique Logistica
- Chamber of Mines of South Africa
- The University of Queensland
- Kepco SPC Power Corporation, Philippines
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Deloitte Consulting - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- GN Power Mariveles Coal Plant, Philippines
- Indian Oil Corporation Limited
- Indogreen Group - Indonesia
- Petron Corporation, Philippines
- White Energy Company Limited
- Vizag Seaport Private Limited - India
- The Treasury - Australian Government
- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
- Bukit Makmur.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Kartika Selabumi Mining - Indonesia
- Salva Resources Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Power Finance Corporation Ltd., India
- Bhushan Steel Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Ministry of Transport, Egypt
- Bayan Resources Tbk. - Indonesia
- Global Green Power PLC Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Sojitz Corporation - Japan
- CIMB Investment Bank - Malaysia
- SMC Global Power, Philippines
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Altura Mining Limited, Indonesia
- Jaiprakash Power Ventures ltd
- Latin American Coal - Colombia
- Attock Cement Pakistan Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Parliament of New Zealand
- PNOC Exploration Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Oldendorff Carriers - Singapore
- Wood Mackenzie - Singapore
- IHS Mccloskey Coal Group - USA
- Global Business Power Corporation, Philippines
- Interocean Group of Companies - India
- TNB Fuel Sdn Bhd - Malaysia
- Mintek Dendrill Indonesia
- Grasim Industreis Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Posco Energy - South Korea
- SMG Consultants - Indonesia
- Straits Asia Resources Limited - Singapore
- Pendopo Energi Batubara - Indonesia
- MS Steel International - UAE
- Rio Tinto Coal - Australia
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Vedanta Resources Plc - India
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- VISA Power Limited - India
- San Jose City I Power Corp, Philippines
- Independent Power Producers Association of India
- Kideco Jaya Agung - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Videocon Industries ltd - India
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- ASAPP Information Group - India
- Bulk Trading Sa - Switzerland
- Central Java Power - Indonesia
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- OPG Power Generation Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Agrawal Coal Company - India
- Petrochimia International Co. Ltd.- Taiwan
- LBH Netherlands Bv - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Commonwealth Bank - Australia
- Siam City Cement - Thailand
- Toyota Tsusho Corporation, Japan
- Planning Commission, India
- Australian Coal Association
- AsiaOL BioFuels Corp., Philippines
- Aditya Birla Group - India
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Mines - Canada
- Bukit Baiduri Energy - Indonesia
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