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Braemar Seascope Thursday, 22 November 2012

Market Indicator Wet* 21-Nov-12 Oct Avg Avg YTD 2011 Avg

TCE ( US $ / Da y ) TCE ( US $ / Da y ) TCE ( US $ / Da y ) TCE ( US $ / Da y )

260,000 NHC AG/EAST TD3 17,500 -3,000 10,500 8,000

130,000 NHC WAFR/USAC TD5 4,000 7,000 12,500 11,500

80,000 NHC NSEA/CONT TD7 5,000 4,000 7,500 12,000

55,000 CLN AG/JAPAN TC5 17,000 10,500 7,000 5,500

37,000 CLN CONT/USAC TC2 7,500 7,500 9,500 11,500

38,000 CLN CARIB/USAC TC3 18,000 5,500 9,000 10,500

* All rates based on benchmark Baltic Exchange speed and consumption f igures

Dry 21-Nov-12 Oct Avg Avg YTD 2011 Avg

BDI 1,073 952 920 1,549

BCI 2,335 2,104 1,551 2,237

BPI 963 756 969 1,749

BSI 706 753 920 1,377

Container 19-Nov-12 Oct Avg Avg YTD 2011 Avg

B O X i 54.11 54.76 55.99 86.13

Financial 21-Nov-12 Oct Avg Avg YTD 2011 Avg

BRENT CRUDE US$/bbl 111.90 111.97 112.00 110.65

IFO 380 ROTT US$/tonne 595.50 619.20 646.45 618.32

YEN/US$ 82.36 78.98 79.39 79.70

WON/US$ 1,082 1,106 1,127 1,107

US$/EURO 1.28 1.30 1.28 1.39

Braemar Seascope Weekly Chartering Report 2

22/11/2012

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VLCC This has been a very interesting week for ship owners and their chartering staff. The shortage of vessels in the Atlantic, coupled with genuine volume of fixing from the AG, has meant that those owners with vessels in position were able to capitalise. This was an opportunity that allowed more aggressive owners to push rates higher on each fixture, and even encouraged the most tame to at least push for last done for a change. At the same time, in the AG for the first time we have seen the market clearly start to divide; those less approved older vessels were fixed and failed, leaving an opening for well approved tonnage to charge a premium. There has been a lot of discussion in owners’ circles about how to improve the freight market, and perhaps the recent excitement offers some hope for those desperately trying to improve tanker freights. The charterers are usually very quick to respond to excitement by withdrawing from the market, as we see today at time of writing, leaving owners with time to cool of f. With the Thanksgiving weekend starting today, the market will be subdued in any case, so come Monday we will see how much firmness the owning fraternity will show next week. The replacements stole the show this week as charterers had to re-enter the market having fixed in the ws40s for AG/East, and having to pay well into the ws50s for the replacement vessel. The top rate so far reported was a very healthy 270kt x ws57.5 AG/Taiwan on a replacement which was repeated for an AG/Malacca voyage on Tuesday. Some charterers, notably not those involved in replacements, have been happy to see a little excitement in the market, but the fun never seems to last for long. AG/Far East is currently trading 270kt x ws52.5 for a wel l approved modern vessel. Ships missing vital approvals or ex-dry dock are having to show a little discount below ws50.0. AG/West has not been traded much this week as charterers refused to move above ws30.0 for AG/USG and had fixed quite forward for the dates over which the excitement started. West Africa was also an exciting market since W Africa/East is traded in parallel with the AG, and there were precious few Atlantic vessels. It was poetic justice that the owners who first spotted the increasing freight rates in the Atlantic market were the ones that also managed to secure the maximum freight paid W Africa/China 260kt x ws52.0 on the M/T Leonidas. All too often, it is others who profit from the earlier hard won increases in the market made by others. There was limited activity from the Indian charterers, with IOC being the only one to enter the market for W Africa/EC India off 25-26 December dates earlier in the week. The majority of offers received were from eastern ballasters due to a lack of tonnage in the Atlantic. Charterers fixed tonnage ex-Durban at US$4.45m, which was considerably higher than last done on this route. The Indian charterers should still have a couple of cargoes in the 25-30 December window and with the tonnage list in the Atlantic still limited, we expect charterers will continue to face a bullish sentiment from the owners’ side. We are assessing W Africa/WC India at US$4.1m and W Africa/EC India at US$4.4m. The 30 day availability index shows 51 VLCCs arriving at Fujairah, of which five are over 15 years old, compared to 40 last week. Over the first decade of December we have counted a total of 38 fixtures, hence the outlook is balanced for the moment. Bunker prices are at US$610/tonne, up US$0.5/tonne from last week. The freight rate for 280,000mt AG/USG is ws32.0, the same as last week, so owners' earnings are: Round Trip Cape Laden/Suez Ballast US$2,750/day (US$3,000/day last week)* The freight rate for 270,000mt is ws52.5, up ws3.0pts, so owners' earnings are: Round Trip Ras Tanura/Ulsan US$31,000/day (US$24,500/day last week)* *Obviously with slow steaming these daily earnings can be improved

Route Size Load Discharge Today’s Assessment Last Week’s Average

TD1 280,000 Ras Tanura LOOP ws32.0 ws32.5

TD2 265,000 Ras Tanura Singapore ws55.0 ws54.0

TD3 265,000 Ras Tanura Chiba ws52.5 ws52.0

TD4 260,000 Bonny LOOP ws53.5 ws54.5

TD15 260,000 West Africa China ws50.0 ws51.0

China39%

SE Asia18%

USA15%

India14%

Korea/Japan11%

Med/Red Sea3%

VLCC AG Weekly Spot Fixtures by VolumeIntended Discharge (15 - 21 Nov 2012)

Long East23%

Short East50%

West27%

VLCC AG Monthly Spot Fixtures by VolumeFinal Destination (Oct 2012)

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22/11/2012

Whilst it started of quietly, the West Africa market eventually sprang into life with healthy levels of fixing achieved thereon in. Unfortunately for owners, this never translated into healthier rates and in fact levels fell off last week's ws57.5 for UKC-Med. Early fixtures at ws55.0 established a market level, following which ws53.75 was promptly achieved to the USG. Late in the week, ws57.5 to USAC was fixed, representing a slight recovery, with ws67.5 W Africa/S Africa, ws60.0 to Peru and ws65.0 joining an early US$2.35m fixture to WC India. The Mediterranean market was dominated by fixtures east this week, but after the expectation last week that increasing weather concerns might boost rates, they in fact fell for cross-Med cargoes to ws62.5. Ws57.5 was fixed for a Med/UKC with cargoes early in the week taken on COA, contriving to deflate sentiment. As for the aforementioned fixtures east, US$2.55m to Singapore was repeated on a couple of occasions, whilst a US$3.0m to China failed. US$2.75m to Thailand and US$3.8m to Australia were also achieved. Regarding the Black Sea, straits delays remain at four days and the market is subject to relatively high levels of volatility. Rates have fluctuated between ws57.5 and ws70.0 (albeit on a replacement) for the UKC-Med. Owner sentiment seems to have settled somewhere around ws62.5-ws65.0 with charterers looking for ws60.0, and later on in the week a US$700,000 to Constanza was fixed. Stems for CPC & Novo are entering the second decade now and it will be interesting to see if rates can be pushed up, should delays increase. In the North Sea, activity was sparse until midweek, when a US$2.75m and US$2.6m to Singapore were fixed, with N Sea/trans-Atlantic fixtures at ws49.5-ws50.0 level with last week. The AG has quietened down this week considerably. Where 130kt x ws75.0 was achieved last week for EC India, 130kt x ws70.0 is now the level for WC India after fixtures to Mundra and Kochi early on. Around a similar time, 123kt x ws70.0 was fixed to Chennai on the east coast to confirm the drop in market levels. The low levels of activity will have done the market little good, so there is little expectation of a rapid bounce back.

Suezmax

USA50%

India East25%

S Africa17%

S America8%

Suezmax WAFR Weekly Spot Fixtures by VolumeIntended Discharge (15 - 21 Nov 2012)


TD5 130,000 Bonny Philadelphia ws57.5 ws57.0

TD6 135,000 Novorossiysk Augusta ws65.0 ws64.0

135,000 Mediterranean UK Cont ws57.5 ws57.5

135,000 North Sea US Gulf ws50.0 ws50.0

135,000 Ras Tanura South East Asia ws67.5 ws67.5

W Africa25%

Med/Red Sea23%Carib/EC Mex

15%

AG15%

NW Europe9%

Black Sea11%

S America2%

Suezmax Weekly Spot Fixtures by VolumeLoad Area (15 - 21 Nov 2012)


22/11/2012

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Aframax

This week in the Mediterranean has been, by and large, the same as last. A few charterers have had to pay the odd point more here and there for a less attractive voyage or off specific dates where tonnage has been a little more tight than others, however fixing levels have mostly remained at the low levels of 80kt x ws75.0 for a routine cross-Med, and ws77.5 from Ceyhan or ex-Black Sea. Owners are still waiting for a significant increase of enquiry, or some severe delays. Quite a lot of volume has been fixed this week in the UKC and Baltic markets. Crude oil Baltic stems have moved in to and been mostly covered up until the first five or so days of December. There has also been a reasonable amount of fuel oil/DPP enquiry on prompter dates and that's taken care of most of the slack in the position list. The large majority of fixtures have been done at last done rates, (i.e. 100kt x ws57.5 UKC for crude oil and a premium for heated cargoes). Although we've seen slightly more complicated or indeed prompter cargoes pay a few more points here and there, the market remains flat and will continue to do so until the fundamentals change. Further West in the Caribbean, following the last two weeks of firm rates and increased earnings, demand has steadily slowed and tonnage has begun to replenish. Had it been for one particular fixture where rates took a unusual large drop in rates so quickly, the market may have stayed slightly firmer for longer than it has done. However, the market is currently rated at 70kt x ws112.5, which is still better than owners have seen for the majority of the year. We expect the market to soften further slightly, but then remain fairly flat thereafter. Activity in the eastern hemisphere was fairly busy with charterers moving to cover their remaining end November and early December stems. TD8 softened slightly to ws92.5 with adequate tonnage supply for charterers to choose from, while owners’ resolve is likely to be tested next week. In addition, one charterer replaced a vessel running late for AG to Red Sea paying US$30,000 more at US$750,000. Indo/N Asia rates hovered around low ws90s with ample tonnage showing on the position list, including nine prompt vessels. On Thursday, one replacement vessel fixed at ws95.0 off 27th November for Indo/N Asia, but owners were unable to maintain these levels. TD14 has picked up with rates stabilizing at ws90.0, and five cargoes were fixed ex-NW Shelf bound to Singapore-Japan range at about mid ws80s levels.

NW Europe54%

N Africa/E Med33%

USA7%

SE Asia2%

W Africa2%

Korea-Japan2%

Aframax (West of Suez) Weekly Spot FixturesIntended Discharge Area (15 - 21 Nov 2012)

Baltic36%

N Africa/E Med39%

Black Sea6%

W Africa8%

UKC9%

Med2%

Aframax (West of Suez) Weekly Spot FixturesLoad Area (15 - 21 Nov 2012)


TD7 80,000 Sullom Voe Wilhelmshaven ws85.0 ws85.0

TD8 80,000 Mina Al Ahmadi Singapore ws95.0 ws95.0

TD9 70,000 Puerto La Cruz Corpus Christi ws112.5 ws115.0

TD14 80,000 Seria Sydney ws90.0 ws89.0

TD17 100,000 Primorsk Wilhelmshaven ws57.5 ws57.5

TD19 80,000 Ceyhan Lavera ws77.5 ws78.0


22/11/2012

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-20,000

0

20,000

40,000

60,000

80,000

100,000

120,000

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No

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Dec

US

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TD3 - 260 - Ras Tanura - Chiba TCE

2010

2011

2012

0

20,000

40,000

60,000

80,000

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Se

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No

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Dec

US

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TD5 - 130 - Bonny - Philadelphia TCE

2010

2011

2012

0

20,000

40,000

60,000

80,000

Ja

n

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Ma

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Ap

r

Ma

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Ju

n

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g

Se

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No

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Dec

US

$/D

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TD7 - 80 - Sullom Voe - Wilhelmshaven TCE

2010

2011

2012

-5,000

5,000

15,000

25,000

35,000

45,000

Ja

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Se

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No

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Dec

US

$/D

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TD9 - 70 Puerto La Cruz- Corpus Christi TCE

2010

2011

2012


22/11/2012

The tight LR2 markets meant the week started with a lot of excitement and bigger numbers being shown by owners. Although gains were relatively modest, we've ended up with ships confirmed at ws135.0 to Japan and on subs at ws137.5, whilst rates to the West are up above US$3.0m to UKC. However, all the strong freights have been for 1H December, and whilst the 2nd half of the month is by no means awash with tonnage, it does lengthen out a little and we're already seeing ships that will fix ahead to secure their dates at levels a little below last done. LR1s have had a torrid time of it in that their fortunes have been capped by the LR2s. Rates rushed back up to meet parity with LR2s to Japan at ws135.0, which is an anomaly and needs to see an adjustment upwards or downwards from one of the markets. Activity remains brisk and the lists do look a lot thinner. However, the West remains very moribund and these high levels will attract ballasters, which will likely subdue levels going forward.

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Clean Products - East

-5,000

5,000

15,000

25,000

35,000

Ja

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Ma

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Dec

US

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TC1 - 75 - Ras Tanura - Yokohama TCE

2010

2011

2012

-5,000

5,000

15,000

25,000

35,000

Ja

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r

Ma

y

Ju

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Se

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No

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Dec

US

$/D

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TC5 - 55 - Ras Tanura - Yokohama TCE

2010

2011

2012


TC1 75,000 Ras Tanura Yokohama ws132.5 ws128.5

TC5 55,000 Ras Tanura Yokohama ws135.0 ws131.0

TC4 30,000 Singapore Chiba ws158.0 ws155.5

TC12 35,000 WC India Japan ws154.5 ws151.5


22/11/2012

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Clean Products - West

0

10,000

20,000

30,000

Ja

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Dec

US

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TC2 - 37 - Rotterdam - New York TCE

2010

2011

2012

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Ja

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Dec

US

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TC3 - 38 - Aruba - New York TCE

2010

2011

2012


TC2 37,000 Rotterdam New York ws120.0 ws118.5

TC3 38,000 Aruba New York ws165.0 ws167.0

TC6 30,000 Skikda Lavera ws160.0 ws160.0

Thanksgiving Day is here with not a spike to announce it. US buyers simply did not materialise post-Sandy and pre-Thanksgiving, as some had said. Gasoline inventories and post-election 'consumer friendly' pricing at the pump are the most likely causes of an unexciting and flat TC2 market. There was some volume fixed, and certain charterers such as Petrobras and PMI were quite busy, but the additional cargoes needed to take TC2 above 37kt x ws120.0 were absent. Paper at the beginning of the week saw TC2 slightly stronger as the market anticipated pre-US holidays cargoes. November was bought at ws123.0 and December at ws138.5; as November gets closer to settlement, December was bid up to a high of ws145.0 before softening to end of week at a level of ws140.0. Q1 2013 finished the week at US$20.75/tonne (around ws127.5). A weakening UKC/East naphtha arbitrage has seen LR1s build-up, as well as LR2s, with LR2 owners now indicating significantly less than the last done US$2.775m option concluded off early December dates for UKC/Japan. The outlook for UKC/trans-Atlantic has to be firmer, as workable units – if you look closely enough – are not filling up the position lists. This leads us to suggest that owners are their own worst enemies here. Handy and Flexi owners on the UKC and Baltic seemed to have enjoyed the somewhat usual end of month rush as oil 'across the rail' for this month benefits the trader more than December pricing. Rates have picked up, and looking to the ice season, rates are expected to continue to tick up slowly through the rest of 2012. The Mediterranean has maintained a level of 30kt x ws160.0, steady with moderate activity and many deals being concluded very privately. No doubt charterers are aware of how quickly this market can react to even a slight squeeze on dates, as recently experienced. MR sized cargoes continued to fix, with TC2 +20pts available for those owners willing full discharge options. Again, Petrobras are busy with naphtha ex-Algeria contributing to this premium.

22/11/2012

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A fairly lacklustre week saw rates soften, particularly in the Pacific. However, owners are still not ready to give up hope on further gains before the end of the year. The Pacific market has spent the majority of the week drifting sideways, with yesterday yielding a slip in rates. Despite a relatively decent amount of cargo without the presence of the majors, the market dropped from US$9.30/tonne to US$9.00/tonne and US$8.75/tonne for W Australia. Some more E Australia/NoPac coal orders have been appearing, along with some RBCT cargoes fixing to both EC India and China, also at reduced levels. At the time of writing, the Baltic stands at US$15,396 daily. The Atlantic has certainly been the area of strength in the Capesize market. Despite an end of week slip in rates, the index currently stands at US$18,709 daily. This has been largely due to an influx of Brazil/China cargoes which owners have preferred to cash in on. This does explain why this route has shown only relatively modest gains.

Capesize

0

2,000

4,000

6,000

8,000

10,000

-25,000

0

25,000

50,000

75,000

100,000

125,000

Jan

-09

Ap

r-09

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l-0

9

Oc

t-0

9

Jan

-10

Ap

r-10

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l-1

0

Oc

t-1

0

Jan

-11

Ap

r-11

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l-1

1

Oc

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Jan

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2

Oc

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BC

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The Baltic Capesize Index vs Atlantic & Pacific Earnings

Atlantic Pacific BCI

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22/11/2012

The Pacific has maintained its firm sentiment with SE Asia – namely Indonesia and Australia – producing a steady flow of cargoes, pushing up rates for ships in the area. Short ballasters for Indonesia now demand close to US$11,000/day for India and around US$10,000/day for China whilst ships open in the Japan area achieve a less attractive level around US$8,000/day for NoPac rounds. There appears to be sufficient support in the market to maintain this level well into next week. Rates have been steadily pushing up in the Atlantic over the past week. Prompt tonnage remains in short supply and ballast bonus levels have improved above US$500,000 levels for front-haul trips from US Gulf to the Far East, and for the near future this region is expected to remain firm. On forward business, there is increasing interest for January and February date grain cargoes, but forward freight ideas from charterers for Q1 remain depressed.


Panamax

0

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9

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9

Jan

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Ap

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0

Oc

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Jan

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1

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Jan

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BP

I

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The Baltic Panamax Index vs Atlantic & Pacific Earnings

Atlantic Pacific BPI

Dry

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22/11/2012


Market sentiment this week in EC S America has been generally positive, with owners reporting increasing numbers of enquiries and a firming of rates seen. Front haul numbers for long duration trips out east (55/60days+) have been quoted for large/eco Supramaxes around the US$11,000/day +US$200,000 BB APS EC S America levels. Competition remains stiff though, with rumours that a 50kt 10% MOLOO iron ore pellets parcel to WC India ex-EC S America was fixed on subjects for around the US$24/tonne level. In other news, it was reported that a Supramax was taken at the end of last week/early this week for a trip out of NC S America to UKC around the US$12,000/day APS range. It was also reported on the market that another Supramax had managed US$13,500/day APS for a trip to the E Med. These both represent fairly healthy numbers for owners in light of recent market conditions, but then tonnage has also been tighter on the north coast than down south. Some have concluded though that the turn for the better in market conditions is only a temporary process, brought about by a rush to close out the end of the year and vessels able to make the early December loading windows seeing renewed activity after an extended slow period. This is not helped by rumours that some of the majors are almost cleaned out for contractual shipments for this year, and that cargo for end December dates/early January is likely to become scarce. With a healthy supply of tonnage moving into December and shrinking cargo availability, combined with the seasonal slowdown surrounding the holiday period, it could end up being a cold Christmas for some. Big/shallow Supramaxes were the clear winners of this week in the USG once again for obvious reasons. They were the first choice for Panamax grain stems to China/Japan/Korea destinations and wasn’t too difficult competing with Panamax owners and still getting away with a good number. A few still remain in search for a large Supramax tonnage. On the other hand, it is a completely different story for smaller Supramax positions in USG/NC S America. Freight levels suggest US$15,000-15,500/day would be anticipated while they wait for more orders to hit the market going forward. General positive sentiment is also having an effect on trips to UKC-Med as most owners are now aiming US$13,000-14,000/day for such business. The Handysize market on the Continent has been inactive this week. Charterers of a 20,000mt shipment of coal from up in the Baltic to Continent are aiming at US$12, which owners are reluctant to concede to. However, with little alternatives in the market, charterers are happy to sit back and take a spot vessel. This sums up the story on the Continent at the moment, and with too many vessels and thus a charterers’ market, things don't look likely to improve any time soon. A 33k Dwt vessel is rumoured to have been taken for about US$8,500/day for a trip east, to the basin that seems to be a light at the end of the tunnel for some owners, no matter how ephemeral it may be. Rates for Handysizes have remained flat this week in the Far East, although there has been some improved level of enquiry for December cargoes. For the Supramaxes, there has been a lot more coal, bauxite and nickel moving out of Indonesia, along with an increased volume of spot orders ex-Australia, and North Pacific has seen the prompt position tighten. Rates should start to move up as the tonnage clears out. Some very firm short period deals being concluded are an indication of a belief in 1Q 2013 strength. Another quiet week for the Indian/AG market with little being done in terms of Supramax fixtures. Iron ore Supramax cargoes to China have been concluded at US$5,000-5,500/day levels basis AG delivery with Iran originating cargoes paying US$9,000-9,500/day basis again AG delivery. Coal ex-RBCT to India has been mainly dominated by Capesize liftings, leaving little space for Supramax stems. South Africa to China mineral cargoes have been rumoured as being concluded at US$8,000/day + US$200,000 BB basis South Africa delivery. No period fixtures reported for the area.

Handy/Handymax/Supramax

0

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3,000

4,000

5,000

0

10,000

20,000

30,000

40,000

50,000

Jan

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Ap

r-09

Ju

l-0

9

Oc

t-0

9

Jan

-10

Ap

r-10

Ju

l-1

0

Oc

t-1

0

Jan

-11

Ap

r-11

Ju

l-1

1

Oc

t-1

1

Jan

-12

Ap

r-12

Ju

l-1

2

Oc

t-1

2

BS

I

US

$/d

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The Baltic Supramax Index vs Atlantic & Pacific Earnings

Atlantic Pacific BSI


22/11/2012

WA coal exports Lanco Infratech, the Indian power company that that took over W Australia's Griffin Coal, has lodged environmental documents to export up to 15m tonnes of coal a year through Bunbury port. Pending approvals, Lanco hopes to begin dredging in June next year with construction of the new berth being completed in October 2014. It is envisaged that coal exports at the berth will be at a maximum rate of 8,000 tonnes/hour, according to Lanco's documents lodged yesterday with the Environmental watchdog. Lanco has already announced it is expanding its Collie-based mines to 5.2mtpa from about 3.8mtpa early next year to supply domestic power stations and about 2mtpa of exports to India via Bunbury and Kwinana. China coal imports up for 2012 China had a net import of 217m tonnes of coal in the first ten months of this year, up 39.5% from a year ago, authorities have said, although the market remained sluggish with rising stockpiles and falling prices. The high net import came amid rising stockpiles and growth slowdown in coal consumption. By the end of October, coal inventories in major power plants reached 93.71m tonnes, equal to 29 days' usage, eight more days than the same time last year. Stockpiles at major ports were 35.62m tonnes, up 37% y-o-y. Coal power accounts for about 70% of China's energy structure, and the country will heavily rely on coal for at least five more years, though the government vowed to increase usage of renewable energy such as solar and wind power in its 12 th five-year plan. The volume of imported coal in the first ten months has exceeded the 168m tonnes of net import the country had in the whole of 2011. The world's largest coal producer and consumer, China overtook Japan to become the world's largest importer of coal in 2011. Crude steel production Production of crude steel by the 62 countries reporting to the World Steel Association was 126.1m tonnes in October, an increase of 1.3% y-o-y, according to Worldsteel. But average daily production last month fell to 4.07m tonnes from 4.12m tonnes in September 2012, Platts calculates from the Worldsteel figures. The industry's capacity utilization rate dropped to 76.5% in October from 77.7% in September, and was 1.4% lower than in October 2011. The October figures took total crude steel output in the first ten months of this year to 1.277 billion tonnes, just 0.7% more than was produced in the same period of 2011. China's October production of 59m tonnes was 6% higher than the same month last year. Of other major Asian producers, only India recorded a y-o-y rise. The month's production fell in Japan (-6.7%), South Korea (-4.9%) and Taiwan (-25.6%). October output in the European Union was 14.2m tonnes, down 6.2% from October 2011. CIS output last month rose 4.4% as higher Russian production outweighed falls in Ukraine and Kazakhstan. Crude steel production in North America was down 1.4% from October 2011 to 9.7m tonnes. Lower US production was only partially countered by higher output in Canada and Mexico. In South America, the month's output was up 4.7% at 4.2m tonnes, thanks to a 7.7% rise in Brazil. China’s iron ore stockpiles fall Stockpiles of iron ore continued to drop at 25 major Chinese ports during the week ending Nov 19. Imported iron ore at the ports stood at 96.89m tonnes last week, down 540,000 tonnes from the previous week. Import prices of iron ore are less likely to go up in the short term as demand for steel is expected to shrink further during the cold weather. However, Xinhua analysts predicted the market would pick up along with an improving economy in the longer term. China, imported 56.43m tonnes of the raw material in October, down 13.2% m-o-m. The average import price dropped 9.45% from the previous month to US$104.9/tonne, according to General Administration of Customs data. China’s domestic iron ore price to be lowered by tax cut China is looking to halve the tax rate paid by its domestic iron ore producers in an effort to maintain local supply and drive down the prices received by Australian and Brazilian miners. To maintain domestic production, the Chinese government is now considering halving the 25% tax rate paid by miners, the state-run China Securities Journal says. It has been said the tax cut could be implemented within two to three months.

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22/11/2012


A slow week on the charter market, with just a handful of orders - the majority of which were for replacement tonnage - and extensions in direct continuation dominating the limited fixture list. A couple of Chinese Liner-owned Baby Panamax vessels have been taken by a Singaporean operator at US$8,800/day - levels a shade below last done - for six to eight months. These are understood to be replacing a brace of 2,700TEU units on the Far East-India service which have been released to a Hong Kong based operator at just US$6,000/day for six months. Rates remain around last done across most other sizes, although the supply of geared feeder tonnage remains relatively tight in the Caribbean and Mediterranean regions, and this is starting to manifest itself in modest rate improvements in cases where owners have little local competition, though the lack of chartering activity in both areas means no significant shortage of supply yet exists. Charterers are generally pushing hard for highly flexible periods, allowing them the option to redeliver over the quieter Christmas and Chinese New Year periods, whilst owners seem happy to cover their ships until the spring and are often preferring 4-5 month periods only, so as not to miss out on gains made during the much anticipated seasonal upswing which the market has experienced for the past three years. The coming weeks are likely to remain flat and it is unlikely the oversupply of tonnage, especially in the mid sizes, will be alleviated sufficiently to cause any increase in rates. However, with bunker prices moving in the right direction and the lines being more active in reducing capacity and exercising price discipline, improved third quarter results have been posted and the hope is that this will translate into charter market gains in the spring.

Containers

Vessel (Teu/Hmg) Gear Speed Knots Index + / -510/285 Gearless 15.5 3.61 ► 0.00

700/440 Gearless 17.5 4.00 ► 0.00

750/415 Geared 16.0 4.71 ► 0.00

1000/650 Geared 17.5 5.00 ► 0.00

1100/715 Geared 20.0 5.94 ► 0.00

1350/925 Geared 20.0 4.19 ► 0.00

1600/1150 Gearless 18.0 5.19 ► 0.00

1700/1125 Geared 19.5 4.69 ► 0.00

1740/1300 Geared 20.5 4.84 ► 0.00

2000/1600 Geared 21.0 1.81 ► 0.00

2500/1900 Geared 22.0 3.16 ► 0.00

2800/2000 Gearless 22.0 2.86 ► 0.00

3500/2500 Gearless 23.0 2.23 ► 0.00

4250/2800 Gearless 24.0 1.88 ▼ 0.05

Index Total 54.11 ▼ 0.05

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8

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08

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08

Oct-

08

Jan-0

9

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09

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10

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10

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10

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1

Apr-

11

Jul-

11

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11

Jan-1

2

Apr-

12

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The Box Index B O X i

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