Strong Asian tanker market in q4
A strong Asian tanker market is expected in the fourth quarter with visible signs of a recovery after being under acute supply pressure for most part of the year, participants said.
In the dirty tanker markets, rates are already close to their highest level this year and the uptrend is expected to gather steam as chartering activity intensifies in Q4. An increase in refinery utilization rate supports the tanker market both ways, pushing up demand for dirty tankers to deliver crude for processing and clean tankers to ship out the products. The rise in demand and increased scrapping activity will offset some of the tanker supply pressure.
It’s goodbye to supertanker u-turns on the high seas
One of the more lucrative opportunities in global commodities markets is about to get a little bit trickier. What might best be described as detour trades — ships switching destinations to profit from higher cargo prices — will become more challenging to execute in 15 months’ time because of changes to the kinds of fuel vessels must burn.
The deviations — often delivering outsize profits to traders — will become tougher for two reasons. The first is that fuel for the shipments currently looks like it will cost a lot more than what owners pay today; the second is that fuels may be incompatible from one supplier to the next, making topping up a more complicated task. Some shipping groups have even said the lack of a uniform product could cause their carriers to break down.
Pushing to eliminate high-sulphur fuels in shipping
Shipping is the last bastion of dangerous low-grade, high-sulphur fuels. It accounts for just 2 percent of global carbon emissions, but produces 13 percent of the world’s sulphur emissions and 15 percent of nitrogen oxides. Banned from every other industry, these fuels have remained in the maritime economy partly because shipping routes tend to be far from human habitation.
Global shipping looks better next year
The international shipping industry may be still reeling from the major economic downturn a decade ago, but prospects will look better starting next year, according to a maritime school official.
According to him, the crisis besetting the global shipping was mainly due to the oversupply of tonnages ordered in the pre-crisis years; the widespread mistrust among banks; and the subsequent withdrawal from the financial letter of credit, where the cargo flow came to an abrupt halt that had an immediate impact on shipping.
Port community advocates the continuation of port community systems
On Thursday 8 November, the European Parliaments Committee on Transport will discuss the proposal for a European Maritime Single Window environment (EMSWe) Regulation.
The EMSWe Regulation as proposed by European Commission is intended to reduce the amount of time that ships spend on reporting procedures during European port calls (1-3 hours per call).
BHP’s Jul-Sep iron ore output rises
Mining giant BHP on Wednesday posted a 10 percent year-on-year rise in iron ore production in the July-September quarter aided by improved rail and port operations, while a 3 percent slip from April-June was attributed to scheduled maintenance.
The world’s third-largest iron ore producer, which operates mines in Western Australia, said its share of production from all assets totaled 61 million wet mt in the September quarter. Including production not attributed to BHP, the projects’ output totaled 69 million wmt, up 8 percent year on year and down 4 percent quarter on quarter.
Shipowners scramble to install sulphur filters ahead of rule change
Ship owners accelerated installations of engine cleaning systems this year ahead of stringent new rules in 2020 which sharply reduce the amount of sulphur ships can emit from the 3.5 percent in current bunker fuel to 0.5 percent, according to a report.
Vessel operators can either switch to cleaner, but more expensive, marine gasoil or install scrubbers to filter sulphur from dirtier fuel oil. The looming change in International Maritime Organization (IMO) rules has impacted fuel and gasoil futures.
Iran says oil exports, production holding up despite looming sanctions
Iran’s oil exports have only declined ‘very slightly,’ while production has remained level, the managing director of National Iranian Oil Company said Tuesday.
Iran faces the reimposition of US sanctions targeting its oil sales on November 5. Many buyers of Iranian crude are already ramping down their purchases ahead of the deadline. Oil exports from the country fell to their lowest level in at least two and a half years in September to 1.7 million b/d, from 1.92 million b/d in August, according to S&P Global Platts trade flow software cFlow, though some shipments not visible through vessel-tracking data are suspected to be taking place. About 1.5 million b/d of the September figure consisted of crude oil, while the remainder was condensate.
Iran’s crude production, meanwhile, dropped to 3.50 million b/d in September from 3.60 million b/d in August, the latest Platts OPEC production survey found. Iran, however, self-reported to OPEC that its September output was much higher at 3.76 million b/d, down from 3.81 million b/d in August.
Scorpio bulkers inks LOI for scrubber installs
Dry bulk shipping company Scorpio Bulkers Inc. announced that it has signed letters of intent with suppliers, engineering firms and ship repair facilities to cover the purchase and installation of exhaust gas cleaning systems, also known as scrubbers, on substantially all of its owned and finance leased Kamsarmax and Ultramax vessels.
Scorpio said the scrubbers and their installation will cost between $1.5-$2.2 million per vessel, and the company anticipates that between 60-70 percent of these costs will be financed. The installations are scheduled between the second quarter of 2019 and the third quarter of 2020.