NEWBUILDING ACTIVITY RETURNS BUT ON ‘SNAIL PACE’
It seems that the trend set in 2016, when newbuilding orders hit a multi-year low is going to spill over to 2017 as well, with the majority of ship owners shying away from contracting, despite attractive prices.
It is also noted that in tankers, although contracted before the end of last year, it has been reported this week that Clients of Pleiades Shipping Agents have placed an order for two firm plus two optional 50,000 DWT MR Tankers at Hyundai Mipo Dockyard.
The two firm units will deliver in 1H 2018 and the optional two units would be delivered within 2018, if declared. Asahi Tanker have extended their series at Minami Nippon by declaring an option for one 51,000 DWT MR Tanker.
GLOBAL SHIP INSURERS TO RESUME NEAR FULL COVERAGE FOR IRAN OIL
Global shipping insurers have devised a way to ensure nearly full coverage for Iranian oil exports from next month after striking a deal to provide cover without involving US-domiciled reinsurers.
Restrictions on US firms handling Iranian goods had greatly limited the number of reinsurers of cargoes, but the new arrangements – which essentially allow re-insurance of ships without the involvement of US firms – should boost the number of eligible shipments. That will provide a boon to Iran, which is trying to raise oil exports after most sanctions were lifted last year, though banking restrictions that remain in place that could cap any major rise in exports.
BALTIC DRY INDEX TAKES A SLOW START TO THE YEAR
Shipowners, many of them Greek, have kept adding dry bulk carriers on their fleets, as they are waiting for the market to recover. Until that happens though, shipbroker Advanced Shipping & Trading noted, in its latest weekly report, that despite last year’s optimism, the market didn’t manage to post a substantial rebound until the final quarter of 2016.
As such, many analysts were expecting this trend to continue during the first quarter of 2017 as well, but so far, the Baltic Dry Index has witnessed a slow start to the year, which can be explained by the general market slowdown, leading into the upcoming Chinese New Year, which is due for the 28th of January.
HK BOX VOLUME SLUMPS FOR FIRST TIME IN 13-YEAR
The port of Hong Kong posted its highest monthly container throughput growth in December by handling 1.8 million TEU, a rise of 14.3 percent over the same month last year. But despite this late push, Hong Kong still saw annual volumes fall 2.5 percent to 19.58 million TEU for 2016 as projected bringing its first sub-20 million TEU annual throughput since 2002 when the annual throughput totaled 19.1 million TEU.
In December, the main Kwai Tsing terminals saw a 12.7 percent rise in throughput to 1.4 million TEU while the non-Kwai Tsing terminals handled 400,000 TEU in the same month, a rise of 20.2 percent.
INDIA’S IRON ORE SHIPMENTS SURGE AT MAJOR PORTS
Iron ore cargo through major ports has logged the sharpest growth among all commodities in April-December period.
Till the end of December, iron ore shipments were up from 12.7 million ton (mt) to 32.4 mt, a rise of 154 percent. In terms of iron ore traffic, Mormugao port was the biggest gainer with a volume of 9.34 mt compared to 1.49 mt in the year-ago period. Led by iron ore, the Mormugao port recorded the highest growth of 62.51 percent among all the major ports. Waiver of 30 percent export duty on low-grade iron ore fines and lumps (with iron content less than 62 percent) chiefly from Goa buoyed export-bound iron ore cargo from the port.
SOUTH KOREA ADOPTS NEW PURCHASE STRATEGY FOR CARGOES
South Korean power utilities are to target mid-calorific value 5,000 to 5,500 kcal/kg NAR thermal coal in purchase tenders for second quarter shipments including from Australia and Russia and possibly US cargoes, it is said Tuesday.
Q2-delivery cargo tenders for such mid-range calorific value thermal coal could start to emerge from Korean buyers over the next few weeks. Korean utilities’ new purchase strategy is informed by two market factors: firstly, an increase in the Korean government’s consumption tax for imported thermal coal which will favor mid-CV product, and secondly, a shift away from lower-calorific value Indonesian cargoes. Mid-CV coal in the range of 5,000 to 5,500 kcal/kg NAR may benefit from changes to the consumption tax.
TANKER NEWBUILDINGS’ DELAYS PERSIST
Higher than initially anticipated tanker newbuildings’ slippage during 2016 doesn’t bode well for the freight market’s fortunes during 2017.
In latest weekly report, it is noted that newbuilding delays are a common in shipping. Slippage can often be prompted by the owner who wants to delay the entry into a weak market, with depressed earnings.
In the recent past, delays initiated by the tanker owner were most visible during the previous industry downturn between 2011 and 2013. Alternatively, shipyards themselves could be behind the delays. Shipbuilders may fail to meet their construction schedule for several reasons: technical, financial, labor or supply related issues.
USA, INDIA TO STRENGTHEN MARITIME TIES
India’s shipping, road transport and highways minister Nitin Gadkari led a week-long trade delegation to the US last year, during which the two countries agreed to strengthen their maritime ties.
What opportunities does India’s maritime sector offer to American investors and what kind of shape could this partnership take?
Patrick Kingsland spoke to Hemal Shah, manager, transport logistics & real estate at the US-India Business Council to find out more. It was only a few days after the Indian government announced cargo traffic at twelve of its largest ports was up by 6.2 percent that a major step forward in US-India maritime cooperation took place.