10th February 2017
A busier start to the week saw a number of small cargoes being quoted and fixed. Product in North West Europe has mainly been sourced from Kaarsto with a number of butane stems fixed. Action this week has seen available positions eroded which as it turned out took away a number of prompt vessels from an already shorter than usual tonnage list, meaning in turn that Charterers are now having to look up to 10 days in advance to secure ships. Although fewer vessels are available rates have remained stable as Charterers have been able to re-arrange their programs. The larger coasters are in shorter supply as a few ships are due to dry dock, and so the next open vessels will depend on owners COA programs.
The Med and Black Sea market is quiet with few cargoes being quoted. Bad weather is delaying ships discharging in Morocco and loading in Arzew while opportunities from the USG also remain unworkable
With the Chinese New Year holidays only officially ending this coming Saturday, the market has continued to be quiet. Break bulk re-exports have remained relatively inactive this week, with terminals focusing on their domestic sales. From the shipping perspective, the 3,500cbm and 5,000cbm segments remain quite tight, with petchem activity keeping spot vessels employed into March. There are effectively no spot LPG vessels in these size segments at the moment. On the larger pressurized segment we are seeing several vessels open on prompt dates under last cargo LPG, though these vessels are a little trickier to employ in the region in LPG. Potentially this market could tighten if one or two of these vessels move into Petchems or leave the area. Time Charter rates remain relatively flat due to the lack of activity. Discussion on propylene has been limited due to a scarcity of supply, though there has been some talk that Kuantan could have some availability in the coming weeks. Also the expectation that the Butadiene market will weaken has yet to be seen.
Time Charter Fixtures
Epic Barnes (7200cbm – ’02 blt) fixed for 12m TC to Petredec to a/c Cepsa bss del NWE early Feb - rnr
Ernest N (2009 - 59,000cbm) fixed for 3/4 monthx TC to Peteredec bss del/redel USG mid low/mid $500k pcm
Jenny N (2009 - 59,000cbm) fixed for 3/4months TC to a/c Vitol bss del/redel WAF high $400k pcm
Warinsart (2014 - 38,000cbm) extended for 12months TC to SHV bss del/redel AG - rnr
Sale and Purchase/New Buildings
Further to rumors of last week, it has now been reported that the LOI signed by Varun Shipping at Jiangnan Shipyard in China is for six VLGC newbuildings, rumored in the low/mid US$ 60’s mill each. We understand that there are multiple subjects including the Buyers’ arranging finance. There are rumours that a Hedge Fund in London is seeking equity for the project.
The 3,500 cbm fully pressurised LADY MARGAUX (built 2000 at Shitanoe Zosen) has been sold to Myung Shin Shipping Co. of South Korea. She has already delivered to her new Owners and has been renamed the LADY GAS.
The 80,000 cbm GAS CONCORD (Built 1976), which has been employed as a FPSO in Indonesia, is the first VLGC to be sold for recycling in 2017. Given that she has been sitting in Indonesia for more than 10 years, it is not surprising that she has been sold “as is” with delivery into Bangladesh.
Otherwise following two fires on a VLGC being dismantled on the beach in Pakistan, the authorities in Pakistan have suspended all cutting steel and are closed to the recycling of all Tankers, not just LPG vessels, for the foreseeable future. Ironically Pakistan is generally not a big Buyer of LPG vessels which tend to be sold into India, with Bangladesh occasionally buying the bigger units as seen above.
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