WORLDWIDE SHIPPING INDUSTRY
Baltic index slides for twelfth session on sluggish demand
The Baltic Exchange’s main sea freight index extended its decline for a twelfth session in a row on Wednesday, reaching its weakest level in more than a month, hurt by a softer demand for the capesize segment. The Baltic index, which tracks rates for ships ferrying dry bulk commodities, fell 22 points, or 1.3 percent, to 1,712 points, its lowest since July 4. The capesize index slipped 131 points, or 4 percent, to 3,171 points, its weakest in more than a month. The index is down for the sixth straight session. Average daily earnings for capesizes, which typically transport 170,000 tonne-180,000 tonne cargoes such as iron ore and coal, fell $740 to $23,885.
Dalian iron ore futures on Wednesday slumped to their lowest intraday level since June 26 on weakening demand and rising supply. The panamax index gained 32 points, or 1.8percent, to 1,791 points.
Battery-powered ships next up in battle to tackle emissions
The electric battery boom has a new target: ships. Four Japanese companies have teamed up to build the world’s first zero-emission tanker by mid-2021 that will be powered by large-capacity batteries and will operate in Tokyo Bay, according to a statement on Tuesday.
The new company e5 Lab Inc. is a venture between Asahi Tanker Co., Exeno Yamamizu Corp., Mitsui O.S.K. Lines Ltd. and Mitsubishi Corp. The global maritime industry is facing an onslaught of legislation to improve its environmental performance. From next year, a majority of vessels will have to burn fuel containing less sulfur. A challenge requiring even more innovation, though, is a goal to halve shipping’s carbon emissions by 2050. While fully-electric ships have struggled to penetrate major markets, momentum is gathering.
Ship recycling market on further downward slump
The demolition market has remained on a downward path, with recyclers offers declining and ship owners refraining from more deals. In its latest weekly report, shipbroker Clarkson Platou Hellas said that “the mood in the market slipped further this week as the depressive state continued with domestic price levels in the Indian sub.
Continent showing no signs of a reversal. There appears to be a total lack of confidence from the actual recyclers with the appetite from India remaining relatively damp, and Bangladesh showing no willingness to offer for tonnage whilst their yards remain full of previously acquired tonnage due to the severe monsoon rains hampering any cutting process.
Iron ore arrivals at Chinese ports dip
Arrivals of seaborne iron ore at Chinese ports shrank last week, as cargoes that arrived at ports in both Shandong and Tangshan slid week on week. SMM estimates that 85 vessels carrying 12.1 million mt of iron ore arrived at major Chinese ports during July 28-August 3, down 2.31 million mt from the week ended July 27, after arrivals rebounded 2.88 million mt in the previous week.
During July 28-August 3, iron ore deliveries departing Australian ports grew 500,000 mt from the prior week to 14.57 million mt. Shipments that left Brazilian ports expanded 850,000 mt to 7.24 million mt. Iron ore deliveries leaving both Australian and Brazilian ports have increased for two consecutive weeks as of August 3, and this is expected to grow arrivals at Chines ports in mid- or late- August.
German bank seeks to seize ships for breach of Iran sanctions
Reports alleging that fuel tankers appeared to breach US sanctions against Iran were cited in court filings by a bank as it sought to seize the ships, accusing the owners of loan default. The accusations, which led to the temporary arrest of the vessels in Singapore late last month, come as the US seeks to isolate the regime in Tehran by cutting off oil sales, a major source of revenue.
They also underscore how traders and shippers suspected of violating sanctions can run foul of their own lenders, not just governments. Hanover-based Norddeutsche Landesbank-Girozentrale, known as NordLB, detailed its claim in documents filed last month in the High Court of Singapore seeking the arrest of the vessels, accusing their China-based owner of defaulting on a $30 million mortgage agreement.
Container ports: the fastest, the busiest, and the best connected
Known as the ‘humble heroes’ of globalization, containers are handled in hundreds of millions at container ports worldwide annually. Efficient and well-connected container ports enabled by frequent and regular shipping services are key to minimizing trade costs, including transport costs, linking supply chains and supporting international trade.
Thus, port performance is a critical factor that can shape countries’ trade competitiveness. Every hour of port time saved by ships translates into savings in port infrastructure expenditure for ports, ship capital costs for carriers, and inventory holding outlays for shippers. Recognizing the importance of measuring container port performance, UNCTAD developed the Liner Shipping Connectivity Index (LSCI) in 2004 to determine countries’ positions within global liner shipping networks; the latest country-level LSCI statistics were published in July 2019.