Global container freight market bearish as lunar new year hits
Sentiment in the container freight market has turned largely bearish as the shutters have come down on Chinese industry for the New Year celebrations, but this was while largely expected, the magnitude of the rate decline is a key concern.
Freight rates along major head-hauls from North Asia are expected to lose significant ground over the course of February, with some carriers expecting rates along Platts Container Rate 1 North Asia to North Continent to fall as much as $350/FEU (forty foot equivalent unit) over the first two weeks of February alone, from $1,575/FEU on January 31, potentially hinting as much as a 20percent fall in two weeks alone.
Freight rates of clean petroleum cargo to Asia tumble
Freight rates to carry an 80,000 mt clean petroleum product cargo from the Mediterranean to Asia Pacific dropped to a 10-week low of $28.75/mt on Tuesday, a lumpsum equivalent of $2.3 million, as delays through the Turkish Straits for larger vessels prompt charterers to seek smaller tankers.
Rates on the Mediterranean to Japan route, a typical voyage for naphtha cargoes, have dropped 18 percent from an all-time high of $35/mt ($2.8 million lumpsum equivalent) on December 20.
Asia VLCC rates fall to new lows in January
Asian VLCC rates have declined sharply in January on the back of weak demand and surplus tonnages, market participants said.
Rates for the benchmark Persian Gulf-China route fell 15 Worldscale points since January 2 through to w48 on Thursday, according to S&P Global Platts assessments. China’s Unipec chartered a ship at this rate Wednesday.
The decrease in demand along with the build-up in supply in the Persian Gulf amid OPEC’s cut in crude output for six months starting January contributed to the fall in Asian VLCC freight rates, market participants said.
Market has been under downward pressure in the Persian Gulf with significant decline in cargo inquiries for loading in January, sources said.
The number of loadings in the Persian Gulf and the Red Sea region are estimated at 127 for January, down by around 10percent from the previous quarter, when they averaged 140, according to brokers’ estimates.
However, the rise in US crude exports has pushed up the freight on the USG-China route to $7.4 million or 27.41/mt, according to Platts assessment. This has prompted VLCCs to ballast to the Atlantic and cushioned the decline in rates in Persian Gulf market.
Adani posts q3 net up 42pc on double-digit cargo growth
India’s largest port developer and logistics arm of the Adani Group, APSEZ, on Wednesday reported a 41.75 percent surge in its consolidated net profit to Rs 1,418.93 crore for the quarter ended December 31, 2018.
Adani Ports and Special Economic Zone Limited (APSEZ) had clocked a consolidated net profit of Rs 1,001 crore for the third quarter in the last fiscal, the company said in a regulatory filing. The total income of the company grew to Rs 3,168.88 crore during the quarter under review as against Rs 2,924.85 crore a year-ago. Its consolidated total expenses increased to Rs 1,347.97 crore in the October-December quarter as against Rs 1,330.86 crore in the year-ago period.
Atlantic Supramax freight hits 17-month low on oversupply of ships
Atlantic Supramax freight costs hit 17-month lows Monday as an oversupply of vessels along the US Gulf and East Coasts forced shipowners to compete fiercely on price for available cargoes.
S&P Global Platts’ cFlow software reported 46 unladen Supramax vessels in the US Gulf and a further 16 along the East Coast, while sources reported that the number of spot Handysize vessels available for prompt cargoes was upward of 80 across the same regions.
South Korea low sulfur marine gasoil supply still tight
The tight supply of low sulfur marine gasoil in South Korea continued into February, from January, on robust demand following the January 1, 2019 implementation of China’s 0.5percent bunker fuel sulfur limit along its entire coastline.
Market sources said there has been a shift in demand from MGO to LSMGO following the emission regulations.
“The demand for MGO is like nothing nowadays, most of our customers take LSMGO,” a market source with one refiner quoted as saying.
Vessels were understood to be taking LSMGO at South Korean ports before heading to China. Supply was also short, with two refiners unable to offer the fuel in the spot market.
One of the refiners said the shortage was due to strong demand, coupled with the shortage of a blending component, which is necessary to lower the pour point in order to meet ISO’s winter specifications.
Indian gov’t to spend USD21M on Chabahar port
India’s government was announced to have set aside USD21 million in this year’s budget as expenditure for the Iranian southeastern port of Chabahar growth.
According to the Financial Express,“For Chabahar port, New Delhi’s key connectivity plan with Afghanistan and central Asia remained unchanged from the previous year at Rs 150 crore.”
Tankers in black sea ablaze for more than a week
A fire has been raging onboard the tankers Maestro and Candy for more than a week already, no vessel movement or list was registered by Monday morning, an emergency source in the Southern Federal District told TASS.
“The fire continues, there were no changes,” the source said. According to earlier reports, there were more than 4,500 tonnes of liquefied gas on the tankers.
The list of the ships was observed in the previous days. According to another source, the Maestro’s list was 15 degrees aport. The vessels also started drifting toward Russian shore, but were stopped, and there is no movement now.