WEEKLY SHIPPING MARKET REPORT WEEK 7 - 13 th February – to 17 th February 2012 - Legal Disclamer The information contained herein has been obtained by various sources. Although every effort has been made to ensure that this information is accurate, complete and up to date, Shiptrade Services S.A. does not accept any responsibility whatsoever for any loss or damage occasioned or claimed, upon reliance on the information, opinions and analysis contained in this report. Researched and compiled by: Shiptrade Services SA, Market Research on behalf of the Sale & Purchase, Dry Cargo Chartering and Tanker Chartering Departments. For any questions please contact: [email protected]Shiptrade Services SA Tel +30 210 4181814 [email protected]1st Floor, 110/112 Notara Street Fax +30 210 4181142 [email protected]185 35 Piraeus, Greece www.shiptrade.gr [email protected]
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WEEKLY SHIPPING
MARKET REPORT WEEK 7
- 13th February – to 17th February 2012 -
Legal Disclamer
The information contained herein has been obtained by various sources. Although every effort has been made to ensure that this information is accurate, complete and up to date, Shiptrade Services S.A. does not accept any responsibility whatsoever for any loss or damage occasioned or claimed, upon reliance on the information, opinions and analysis contained in this report.
Researched and compiled by: Shiptrade Services SA, Market Research on behalf of the Sale & Purchase, Dry Cargo Chartering and Tanker Chartering Departments. For any questions please contact: [email protected]
Strikes continue at Australia's Port Kembla coal terminal
Australia's Port Kembla coal terminal faces more strike action this week, which is likely to slow coal and coke exports from the terminal, a union spokesman said on Monday. BHP Billiton-operated Port Kembla exports around 10 million tonnes of coal and coke each year, according to the Port Kembla Port Corporation, and processed about 5 percent of seaborne metallurgical coal used for steelmaking last year. After a week-long strike beginning Feb. 1, about 100 union members will have work stoppages ranging from two to four hours on Monday, Tuesday and Thursday besides full-day stoppages on Wednesday and possibly Friday, Bob Timbs, a union spokesman, said. The coal terminal is brought to a standstill every time union members strike, he said. The workers of the Construction Forestry Mining and Energy Union (CFMEU) are striking to protest against the Port Corporation's proposal to cut the number of employees covered by the union agreement. The union had also asked for a pay raise of 4.5 percent and the port had offered an increase of 4.3 percent, but Timbs said pay was not the focus of the strikes. The Port Kembla Coal Corporation was not immediately available to comment. The Port Kembla strikes coincide with a week-long strike at BHP Billiton-Mistubishi Alliance (BMA) mines, where 3,500 unionised workers have walked off the job in a bid to get greater job security and more pay. Analysts have estimated that a full week of 12-hour stoppages at the BMA mines would cut production by up to 1 million tonnes. (Reuters)
Oil Trades Near Nine-Month High on Iran Tension
Oil traded near the highest price in nine months after euro-area finance ministers agreed on a second bailout for Greece, improving prospects for fuel demand. Futures in New York advanced as much as 2.1 percent from Feb. 17. There was neither floor trading nor a closing price yesterday in the U.S. because of the Presidents’ Day holiday. Brent futures were little changed in London as Europe Union finance ministers awarded 130 billion euros ($173 billion) today in aid to Greece. “There is improved market sentiment because of the Greek debt deal,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “It is good for risk appetite, so all risky assets are up today.” Oil futures for March delivery on the New York Mercantile Exchange, which expire today, advanced as much as $2.20 from the Feb. 17 closing price to $105.44, the highest intraday price since May 5. The contract was at $105.06 at 9:09 a.m. in London, while the more-actively traded April future gained $1.80 to $105.40. Today’s trades will be booked with
yesterday’s electronic transactions for settlement. Prices are 12 percent higher than a year ago. Brent oil for April settlement on the ICE Futures Europe exchange was at $120.15 a barrel, up 10 cents from yesterday. The European benchmark contract’s premium to New York-traded West Texas Intermediate was at $14.75, compared with this year’s widest spread of $19.02 on Feb. 6. Iran Risk The possibility of an Israeli strike against Iran is a bigger risk than a closure of the Strait of Hormuz, and may not yet be factored in the price, said Amrita Sen, a commodities analyst at Barclays Plc in London. “We’ve talked about Hormuz, which we don’t think will happen. That could take it to $150 or even higher,” Sen said in interview with Mark Barton on Bloomberg Television’s “On the Move” program. “An Israeli strike on Iranian production would be much worse.” United Nations investigators are starting two days of meetings in Iran, offering Tehran a chance to stem speculation that its nuclear program will spark a military conflict. Oil’s gain comes after Iran’s oil-ministry news website Shana reported Feb. 19 that the nation will cut supplies to the U.K. and France. Iran’s attempt to preempt a European Union import ban will have “no impact on Britain’s energy security or supplies,” U.K. Foreign Secretary William Hague said yesterday in London. The U.K. got 1 percent of its crude from Iran in the first half of 2011 and France got 4 percent, according to the U.S. Energy Administration. Restoring Libya “We imagine this was met by our friends in London with a general shrug,” Stephen Schork, president of the Schork Group in Villanova, Pennsylvania, said in a note today. He estimates that 22 percent of Iranian crude exports are purchased by China, while Japan buys 14 percent. “Until we see one of these buyers affected, Iran will remain mostly bark and little bite.” Libya, holder of the largest oil reserves in Africa, won’t be able to restore oil production to pre-war levels before the end of 2013 at the earliest, Shokri Ghanem, the former chairman of Libya’s National Oil Corp., said in an interview yesterday. Libyan Oil Minister Abdul-Rahman Ben Yezza said on Dec. 14 that the country’s crude output will return to its pre-conflict level in the third quarter of 2012. The country is restoring production disrupted by fighting last year that led to the ouster of then-leader Muammar Qaddafi. “I don’t think they can come back to pre-revolutionary levels, say, by the summer,” Ghanem said in an interview in Doha, Qatar. The country’s new government must first improve security at oil installations, free up sufficient funds for the oil sector and resolve labor disputes among oil workers, he said. Hedge-funds and other money managers raised bullish bets on Brent crude by 6,818 contracts, or 7.5 percent, in the week ended Feb. 14, data yesterday from the ICE Futures Europe exchange showed. (Bloomberg)
In Brief: Market followed a steady pattern and increase in rates was halted with the BDI reaching 717, only 2 points higher than last week.
Capes: Another week with low rates and over supply of tonnage The market continued its flat pattern with the average of the four T/C Routes closing at USD 5,286 recording a marginal USD 59 increase. The T/A round was done at or below USD 5,000 levels with tonnage over supply to be the main factor for keeping rates down. Even the fronthaul trips did not make much sense and the number of vessels ballasting to ECSA was increased. The Tubarao/Qingdao was done at USD 19,50 levels. In the Pacific, market remained at rock bottom levels since we saw many new buildings entering the market plus the tonnage already drifting or anchored. In spite the Australian majors generated some cargoes owners were still far from covering their opex with many vessels ballasting to Atlantic since taking a back haul trip yielded negative results for owners. Owners showed some movement towards short period with rates averaging USD 12,500 for 6/8 months.
Panamax: Atlantic Market firming up but slowly. In the Atlantic Basin the week started with a positive sentiment as the USG and ECSA grains firmed up. All fresh requirements were fixed quickly and after Wednesday the rate levels started lowering again. In addition we should definitely mention that Continent started waking up with some fresh requirements out of Finland and Murmansk. Of course the rates didn’t increase much but some vessels were fixed on for Murmansk round voyage at usd 9000 time charter equivalent. In the Pacific, a few encouraging fixtures from ECSA led owners asking basis delivery Singapore usd 12000 for LME’s and the rates closed for LME’s at usd 11500 basis dely Singapore. The Pacific/Aussie rounds closed at usd 8500-9000 for LME vessels. The short period rates are still below 10,000 but more takers entered the market which is encouraging owners to wait for further improvement.
Supramax: PG – India firming up
In the Atlantic Basin, the rates fell slightly compared with the previous week. The USG seems weakening further as not much coal and petcoke came out during this week. A few fresh cargoes out of continent were not enough to make the sentiment positive. USG-Med rates didn’t break the 10.000 levels and the fronthaul trips out of Bsea closed at rates between 18-20000 usd. In the Pacific the NOPAC rounds were fixed at usd 6500 basis dely North China-Japan range i.e. about 1000 usd less than previous week. On the contrary the rates for Indo rounds were increased about 1000 usd compared with the week before whereas Aussie market was quiet. PG firming up and rates for Tess 53k dwt vessels closed at around 15000 for trips to China via PG excluding Iran and at 16 for trips out of Iran to china. PG-India rates closed at usd 14000 for Tess 53 type vessels. Handysize: Another flat week with low rates and slow movement in both basins In the Atlantic, over supply of tonnage and low cargo volume preserved the negative sentiment with the TA round ending up at USD 4,800, which was even lower than the previous week. ECSA did not produce significant volume of cargoes while we saw fixtures concluded at USD 1,000 for trips ex MED to USG. Most owners avoided the trips to Far East since rates there were extremely low and the return to Atlantic was paying zero hire up to USD 2.000 which made no sense to owners. Vessels open at PG and India continued to suffer with most movements and somehow better rates to be seen for trips with sulphur ex Iran to China. At East Coast of India there was a massacre with very few orders, many open vessels resulting to exceptionally low numbers. Not much happened on period tonnage due to very bad rates and the anticipation from owners that ‘things can’t get any worse’.
Dry Bulk - Chartering
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Baltic Indices – Dry Market (*Friday’s closing values)