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Expanded Panama canal not the only factor in LNG shipping demand

The expanded Panama Canal is causing dramatic changes in the gas trades and while this may generate significant headline figures, the effects on the shipping industry will still ultimately come down to global trade volume.

Source quoted as saying last week that the Panama Canal or any other trading route doesn’t have anything to do with the demand. It’s more about the cost. The gas trades have been the sector most affected by the expansion of the canal. It is also said that on the key US-Asia trade the next best alternative route would cost about 1.5 times more than to transport through the Panama Canal.

S Korea’s shipbuilding industry losing its cost competitive edge

South Korea’s shipbuilding industry has been overtaken by latecomers, including China, in the liquefied natural gas (LNG) carrier, very large crude carrier (VLCC) and offshore plant sectors that the industry has had the most competitive edge in the world. Even Singapore, which has been “immaterial” in the industry, is taking away orders from South Korean shipbuilders.

Indian fleet-owners term IOC, BPCL tanker charter tenders ‘not workable’

Two separate tenders floated by state-run Indian Oil Corporation (IOCL) and Bharat Petroleum Corporation (BPCL) to hire an oil super tanker and a Suezmax tanker, respectively, on five-year contracts from local shipowners to provide them a much-awaited long-term cargo support has backfired. Local fleet owners say that the tender in its present form is “not workable” and “will not achieve the purpose for which the policy was designed after discussions spread over three years”.

Open interest for ice front-month Singapore high sulfur fuel oil contracts up

Open interest for front-month high sulfur fuel oil contracts traded on the Intercontinental Exchange was up 14.65 percent at 14.067 million mt as of November 30 from 12.27 million mt October 30. Open interest for the Singapore 180 CST HSFO outright swap was up 52.37 percent at 1.67 million mt for the December settlement contact as of November 30 from 1.096 million mt for the November settlement contract October 30, the data showed. Open interest for the December Singapore 380 CST HSFO outright swap inched down 0.44 percent month on month to 6.74 million mt as of November 30 from 6.77 million mt for November settlement contracts October 30, the data showed.

 

Container shipments to have 25pc share of Indian ports cargo

The share of container shipments to the overall cargo handled by Indian ports is projected to rise to 25 per cent at the end of the financial year 2018-19. A report by CARE Ratings says POL (Petroleum, Oil & Lubricants) and container shipments would continue to maintain its lead in the sector. The share of both POL and container shipments to overall traffic at ports is on an upswing. During the first six months of FY18, POL cargo’s share to overall volumes stood at 34.01 percent, marking a 7 percent increase over last year’s share of 27 percent in the same period.

Soaring freight costs will squeeze traders, boost food prices

It’s getting more expensive to transport commodities around the world, threatening to squeeze profits for global traders and raise food prices.

The Baltic Dry Index, a benchmark of shipping rates, surged 73 percent in 2017 to a four-year high because of a slowdown in new bulk freight capacity. More than 85 percent of global trade in grains and oilseeds is transported by dry-bulk carriers, according to Rabobank International.

Cheniere boosts LNG tanker fleet amid Asian demand boom

US liquefied natural gas (LNG) producer Cheniere Energy has expanded its shipping fleet with a flurry of spot vessel charters to keep up with Asian winter demand growth as spot prices LNG-AS hit three-year highs, market sources said.

Cheniere’s Sabine Pass terminal in Louisiana pumped out 22 cargoes last month and more are expected as it ramps up its fourth production unit, or train, with more than half of all November volumes sold to China, Japan or South Korea, according to ship-tracking data. An 82 percent surge in Asian spot LNG prices this year, driven by robust Chinese demand, rising oil and coal prices and nuclear supply shortfalls in South Korea and Taiwan, has left producers chasing to lock in sales.

Istanbul bunker fuel premium to benchmark at six-week high

The premium of bunker fuel at Istanbul over the regional high sulfur fuel oil benchmark has reached its highest point in six weeks amid a soft HSFO market, sources quoted as saying last week. “December is very, very long on components and finished grade,” an HSFO trader said.

The large volume of M100 coming from Russia has contributed to the overload of product in the Mediterranean, despite the ongoing reduction in fuel oil exports from Russia. S&P Global Platts assessed 380 CST fuel oil at Istanbul at $376/mt delivered Tuesday, $30.50/mt higher than the CIF Mediterranean cargoes HSFO regional benchmark, the widest spread since October 23.

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