BANCOSTA Weekly Market Report · According to the Iranian Steel Producers’ Association (ISPA), the country plans to increase their annual steel production capacity to 55 million

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Weekly Market Report

Week 33/2018 (13 August – 17 August)

Comment: World Steel Production Review

index

comment page 2

chartering

dry cargo “ 3

tankers “ 6

containers “ 8

sale & purchase

newbuildings / finance “ 9

secondhand / demolition “ 10

commodities

news “ 11

prices “ 13

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2 market report - week 33/2018

Global steel production has continued to show decent growth in the first half of this year, increasing 4.6% year-on-year to 881.5 million tonnes according to Worldsteel data.

China, the world’s largest producing country, continues to lead gains in steel production, increasing 6.0% year-on-year to 451.2 million tonnes in the first half of 2018, based on Worldsteel data. Recent data from China’s National Bureau of Statistics shows Chinese steel output strengthening further in July, pushing production in the first 7 months of 2018 to 532.9 million tonnes, an increase of 6.3% year-on-year. In spite of continuing environmental curbs, Chinese steel mills have been ramping up production to cash in on strong profit margins, supported by strong demand from downstream users and the ongoing supply-side reform. However, Chinese steel production could slow in the later half of this year as anti-smog measures intensify, with more stringent production curbs expected during the coming winter season.

Output from Japan, the world’s second largest producing country, increased 1.3% year-on-year to 53.0 million tonnes in the first half of 2018. According to Japan’s Ministry of Economy, Trade and Industry (METI), Japanese steelmakers plan to lift crude steel production to 27.07 million tonnes in 3Q 2018, up 4.3% year-on-year and up 1.8% from 2Q 2018, as domestic demand remains firm and exports rise. However, U.S. tariffs imposed on Japanese steel could have some negative impact on the country’s exports and production. Based on trade statistics from Japan’s Ministry of Finance, we estimate Japanese steel product exports to the U.S. have fallen around 16.5% year-on-year to 0.8 million tonnes in the first half of 2018, with U.S. shipments accounting for around 4% of total Japanese steel exports.

India continues to threaten to overtake Japan as the world’s second largest producing country, as their steel production increases 5.1% year-on-year to 52.8 million tonnes in the first half of 2018. India’s steel production has been driven by new capacities coming online, with the country aiming to achieve an ambitious 300 million tonnes in steel making capacity by 2030. Strong growth in domestic consumption from construction and infrastructure projects also continue to support production increases. However, there have been concerns that India’s domestic steel industry may be unable to meet the country’s demand for structural and high-end steel products needed for railroads and construction projects, leading to a surge in steel imports from Japan and South Korea following the U.S. tariffs.

The E.U. produced 87.3 million tonnes of crude steel in the first half of this year, up 1.6% year-on-year. Production from the largest E.U. producers Germany, Italy, and France over this period saw increases of 1.1%, 3.5%, and 0.8% year-on-year respectively to 22.5 million tonnes, 12.8 million tonnes, and 8.0 million tonnes. In mid July, the E.U. launched provisional tariff-rate quota safeguard measures, in an effort to limit steel imports that they fear will be diverted to them in response to the U.S. tariffs. While the measure may support the domestic steel industry and their production, European buyers may turn increasingly to the domestic market to avoid breaching the import quota – a development that could serve to discourage the E.U.’s international steel trade.

In the Middle East, crude steel production was largely boosted by Iranian output, which increased 25.8% year-on-year to 12.5 million tonnes in the first half of 2018. According to the Iranian Steel Producers’ Association (ISPA), the country plans to increase their annual steel production capacity to 55 million tonnes by 2025, from an estimated 32 million tonnes in nominal capacity currently. However, these plans may be foiled by the return of U.S. sanctions, which will impact European companies that had boosted their involvement in new and expanding Iranian steel projects since early 2016 when earlier sanctions had been lifted.

World Steel Production Review

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06/2013 06/2014 06/2015 06/2016 06/2017 06/2018

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World - Monthly Steel Output - last 5 years(source: worldsteel, basis 64 countries ; in million tonnes)

451.2

87.3

53.0 52.8 41.8 36.1 36.118.9 16.9 12.5 10.4 10.4

+6.0%

+1.6% +1.3%

+5.1%+2.9% +2.8% +3.7% +3.7%

+0.9%

+25.8%

+1.5%+3.3%

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

0

50

100

150

200

250

300

350

400

450

500

Ch

ina

EU(2

8)

Jap

an

Ind

ia

USA

Ru

ssia

S. K

ore

a

Turk

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Bra

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Iran

Ukr

ain

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Me

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Crude Steel Output of Top Producers - 1H 2018(source: worldsteel data ; in million tonnes ; comparison year-on-year)

Steel Production Y-o-Y Growth (RHS)

Unit 17-Aug 10-Aug W-o-W Y-o-Y

BCI TC Avg. usd/day 25,373 25,621 -1.0% +31.7%

C8 Transatlantic r/v usd/day 25,675 27,500 -6.6% +39.6%

C14 China-Brazil r/v usd/day 25,623 25,336 +1.1% +33.5%

C10 Pacific r/v usd/day 24,204 23,483 +3.1% +26.4%

1 Year TC Period usd/day 20,000 20,500 -2.4% +33.3%

dry cargo chartering banchero costa

Capesize market recorded a break during last week and came off from very high usd 9 pmt on the route from the West Australia to China to low usd 9 pmt and, similarly, trade from Tubarao to China showed rates moving from high usd 24 pmt to very high usd 23 pmt.

Vale was still very active taking about 10 ships for dates in the first half of September just below usd 24 pmt basis trades from Tubarao to Qingdao.

North Atlantic area was quieter and thin: Brazil was a good option for vessel open in the Continent with Eastern destinations.

Period market was quiet as well: both owners and charterers were undecided about next move.

Capesize Market

Rates

Panamax Market

Rates

The week was characterized in the Atlantic by a steady increase of the trans-Atlantic rates as the tight tonnage supply began to take effect. The improvement was recorded at the beginning on the N Cont with the shorter mineral runs with Kamsarmaxes fixed for a short Baltic RV with redely Gibraltar at $15,000/d compared to $13,750/d of a week earlier, whilst a Panamax fixed a trip via USEC to the Cont/Med at $14,500/d compared to a Kamsarmax achieving $12,000/d for similar employment just over a week before. Fronthaul rates remained flatter with a lack of enquiry from areas other than ECS America which at the end of the week has now become more active for September stems. Rates for this trade increased from about $15,750/d plus $575,000 bb for a Kamsarmax in the previous week to about $16,250/d plus $625,000 bb with almost same trend also in the Pacific too. In this side of the world the improvement in round-voyage rates started in the North with rates pushed up by a good-quality Kamsarmax tonnage available for NoPac stems, then followed by a sharp increase in mineral demand from EC Australia and Indo mainly to India. Kamsarmaxes managed to achieve rates in the low $12,000s for EC Australian RVs, about $2,000/d more of what it has been fixed a week earlier. Period interest from charterers increased along with an improved spot market, also supported by increased paper values, although concluded trades were few.

3

0

7,000

14,000

21,000

28,000

35,000

17/8/17 17/12/17 17/4/18 17/8/18

BCI TC and Capesize 1-YR Period (usd/day)

1-YR TC BCI TC

0

3,000

6,000

9,000

12,000

15,000

17/8/17 17/12/17 17/4/18 17/8/18

BPI TC and Panamax 1-YR Period (usd/day)

1-YR TC BPI TC

market report - week 33/2018


BPI TC Avg. usd/day 11,898 10,724 +10.9% +11.2%

BPI 82 TC Avg. usd/day 13,070 11,841 +10.4% n.a.

P1 Transatlantic r/v usd/day 12,778 11,309 +13.0% +12.0%

P2 Skaw-Gib Trip East usd/day 19,865 18,823 +5.5% +12.4%

P3 Pacific r/v usd/day 10,249 8,251 +24.2% +2.7%

1 Yr TC Period Panamax usd/day 12,000 11,500 +4.3% +20.0%

1 Yr TC Period Kamsarmax usd/day 14,000 13,000 +7.7% +19.1%

dry cargo chartering banchero costa

Rates from USG/US Atlantic further increased with several cargoes (coal, grain, petcoke) fixed especially on the USG to Med trade and 2 very interesting fixtures from USG to Atlantic Colombia. Supramax rates from USG to Cont/Med were around $20,000/d and a modern 63,000 dwt was fixed at $23,000/d to Med. On the USG to Atlantic Colombia trade a 60,000 dwt was fixed at $22,000/d and a 56,000 dwt got $20,000/d with grains. USG/Turkey was assessed around $22/mt with the usual discount of $0.5/mt from NCS Am. The ECS Am market registered a good recovery with Tess58 type fixing around $17,000/d to Med and $16,000/d to Cont basis dely aps ECS Am, Ultramaxes were fixing around $17,500/18,000/d. Trips to F East on Supramax were fixed around $14,250/d + 425,000 bb and on Ultramax around $15,000/d + 500,000 bb. Handysize were fixed around $14/15,000/d for trips to Cont/Med depending on ships’ size. The tonnage list is shortening.

Supramax & Handysize Market

N E

uro

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Me

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anea

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Ind

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S A

fric

a

The market was active in Cont, especially for Handysize with fresh Grains and Fertilizers cargoes from Baltic/Cont to USG and also Coal to E Med. A modern 32,000 dwt was fixed basis dely Ushant for 2/3 laden legs with redely Atlantic at $10,500/d basis 1st leg Grains ex Baltic to Veracruz. A 33,000 dwt was fixed at $10,000/d for short period with redely Atlantic basis dely Skaw. Cont to E Med with scrap was rated around $11,500/d on modern Handies. Supramax were stable and reported to fix around $13/14,000/d basis dely dop Cont with scrap to E Med. The tonnage list was tight in E Med/BSea with plenty of enquiries. Rates were firming up for August dates and, little doubt, will continue for September dates. A quick trip from BSea to Egypt was fixed at $11,000/d on a 32,000 dwt and Supramax were asking around $15,000/d basis redely worldwide. The developments in Turkey put a big break on the scrap business which is a bearish factor. An Ultramax with Grains from BSea to Cont was fixed in the mid $15,000/d and a 57,000 dwt was rumored at $17,000/d basis dely Canakkale for a trip to W Africa with clinker. On short periods a 58,000 dwt was rumored at $15,000/d basis dely Salerno for 5/7 months and a 53,000 dwt was rumored at low $13,000/d basis dely BSea for 4/6 months and redely Atlantic.

Another week with slower activity was registered in the region. A 56,000 dwt spot WC India was fixed at a very high $11,000/d basis dely aps Mina Saqr for a trip via UAE to India early in the week. A 57,000 dwt was then fixed at mid/high $10,000/d with Sulphur to China basis dely dop MEG port. Towards the very end of the week there were rumors of a 58,000 dwt fixing at $12,000/d basis dely aps Mina Saqr to India. On the period front, rates dropped significantly with a Supramax fixing around low $11,000/d for short period bss dely dop Pakistan. From S Africa the market slid further: a 57,000 dwt was fixed at $11,900/d + 150,000 bb basis dely aps Beira with Coal to India, a 63,000 dwt was rumored at $12,350/d + 235,000 bb for a trip to F East basis dely aps Durban, which is considerably lower than the last few weeks when fixtures were in the high $12,000/d + high $200,000 bb for similar trades. With the upcoming holidays in the region the market is expected to slow further.

Far

East

P

acif

ic

An increasing number of spot fixtures showed timecharter rates were softening by around $4/600/d for Supra/Ultramax. The most active trade was the coal trade from Indonesia basis discharge India/MEG range; two 56,800 dwt Dolphin-type with dely EC China where fixed at $8,250/d for 45 days and $9,250/d balance, Ultramaxes to WC India were agreed at $12,500/d basis dely Philippines and $9,250/d from Hong Kong. Chinese destinations showed a Dolphin-type fixed at $8,250/d basis dely Hong Kong, a nice 57,800 dwt at $9,500/d from Singapore and an Ultramax at $11,000/d with delivery Indonesia. Nickel ore exports from Philippines to China were reported on an Ultramax at $12,250/d from N China and discharge S China and another unit fixed afterwards with equidistant delivery at $10,500/d to full China range. Supramax clinkers from Cambodia/Vietnam to Bangladesh showed to pay Supramax sizes in the $12/12,250/d levels, irrespectively of the vessels’ quality. Inter SE Asia trading was traded in the $10,200/10,500/d level whilst trips from SE Asia to N China/Japan range were fixed $1,000/d higher; backhauls to SE Asia showed rates in the $8,000s/d region even if loading ex CIS Pacific. A fancy Handymax with dely N China was agreed at $10,500/d for 4/6 months. The Handysize market remained stable and registered larger interests for 32/38,000 dwt units; 2 vessels were reported on Australia RV at $8,250/d basis dely Spore and redely full China and $7,400/d from Philippines to Vietnam. A fancy 38,000 dwt with dely Japan was fixed for a trip to Peru with steels at $8,500/d for 60 days and $10,700/d balance.

US

Atl

anti

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Sou

th A

mer

ica

4

0

4,000

8,000

12,000

16,000

17/8/17 17/12/17 17/4/18 17/8/18

BSI TC and Supramax 1-YR Period (usd/day)

1-YR TC BSI TC

0

3,000

6,000

9,000

12,000

17/8/17 17/12/17 17/4/18 17/8/18

BHSI TC and Handysize 1-YR Period (usd/day)

1-YR TC BHSI TC



BSI TC Avg. usd/day 11,704 11,494 +1.8% +30.4%

S4A 58 USG-Skaw/Pass usd/day 20,128 17,866 +12.7% +59.5%

S9 58 WAF-ECSA-Med usd/day 9,061 9,014 +0.5% +1.0%

S1B 58 Canakkale-FEast usd/day 21,371 20,782 +2.8% +21.9%

S11 58 Pacific r/v usd/day 9,525 9,925 -4.0% +19.5%

1 Year TC Period usd/day 12,250 12,000 +2.1% +22.5%

BHSI TC Avg. usd/day 7,945 7,916 +0.4% +16.8%


Sup

ram

axH

and

y

Rates

Unit 17-Aug 10-Aug W-o-WPremium/

Discount

Aug (18) usd/day 25,340 25,140 +0.8% -0.1%

Sep (18) usd/day 24,540 25,290 -3.0% -3.3%

Oct (18) usd/day 26,210 25,990 +0.8% +3.3%

Q4 (18) usd/day 25,797 25,477 +1.3% +1.7%

Q1 (19) usd/day 14,350 14,350 +0.0% -43.4%

Q2 (19) usd/day 16,070 16,190 -0.7% -36.7%

Cal 19 usd/day 19,610 19,610 +0.0% -22.7%

Cal 20 usd/day 19,550 19,610 -0.3% -22.9%

Cal 21 usd/day 16,500 16,470 +0.2% -35.0%

Aug (18) usd/day 11,735 11,510 +2.0% -1.4%

Sep (18) usd/day 12,430 12,140 +2.4% +4.5%

Oct (18) usd/day 12,780 12,585 +1.5% +7.4%

Q4 (18) usd/day 12,738 12,583 +1.2% +7.1%

Q1 (19) usd/day 11,800 11,800 +0.0% -0.8%

Q2 (19) usd/day 13,000 13,025 -0.2% +9.3%

Cal 19 usd/day 12,608 12,649 -0.3% +6.0%

Cal 20 usd/day 11,890 11,900 -0.1% -0.1%

Cal 21 usd/day 10,150 10,120 +0.3% -14.7%

Aug (18) usd/day 11,610 11,590 +0.2% -0.8%

Sep (18) usd/day 12,410 12,395 +0.1% +6.0%

Oct (18) usd/day 12,610 12,640 -0.2% +7.7%

Q4 (18) usd/day 12,647 12,693 -0.4% +8.1%

Q1 (19) usd/day 11,370 11,240 +1.2% -2.9%

Q2 (19) usd/day 12,320 12,290 +0.2% +5.3%

Cal 19 usd/day 12,415 12,500 -0.7% +6.1%

Cal 20 usd/day 11,735 11,790 -0.5% +0.3%

Cal 21 usd/day 10,420 10,500 -0.8% -11.0%

Aug (18) usd/day 8,300 8,563 -3.1% +4.5%

Sep (18) usd/day 9,025 9,425 -4.2% +13.6%

Oct (18) usd/day 9,313 9,475 -1.7% +17.2%

Q4 (18) usd/day 9,296 9,458 -1.7% +17.0%

Q1 (19) usd/day 8,788 8,888 -1.1% +10.6%

Q2 (19) usd/day 9,313 9,419 -1.1% +17.2%

Cal 19 usd/day 9,338 9,394 -0.6% +17.5%

Cal 20 usd/day 9,113 9,213 -1.1% +14.7%

Cal 21 usd/day 9,013 9,113 -1.1% +13.4%

Han

dys

ize

Cap

esi

zeP

anam

axSu

pra

max

0

3,000

6,000

9,000

12,000

Aug-17 Aug-18 Aug-19 Aug-20

Handysize Forward Curve (usd/day)

0

4,000

8,000

12,000

16,000


Supramax Forward Curve (usd/day)

0

8,000

16,000

24,000

32,000


Capesize Forward Curve (usd/day)

banchero costa dry cargo chartering

Dry Bulk FFAs (Baltic Forward Assessments)

5

0

4,000

8,000

12,000

16,000


Panamax Forward Curve (usd/day)



TD1 MEG-USG ws 23.55 23.86 -1.3% +1.8%

TD1 MEG-USG usd/day -10,353 -11,446 +9.5% -68.2%

TD2 MEG-Spore ws 53.29 52.29 +1.9% +21.8%

TD3C MEG-China ws 52.42 51.50 +1.8% +22.0%

TD3C MEG-China usd/day 14,476 12,251 +18.2% +75.1%

TD15 WAF-China ws 53.08 51.88 +2.3% +7.5%

Avg. VLCC TCE usd/day 2,062 403 +411.7% -26.7%

1 Year TC Period usd/day 21,000 21,000 +0.0% -16.0%

TD6 BSea-Med ws 83.28 82.44 +1.0% +7.5%

TD6 BSea-Med usd/day 9,828 9,004 +9.2% +26.1%

TD20 WAF-Cont ws 65.11 63.48 +2.6% -3.2%

MEG-EAST ws 65.00 65.00 +0.0% -3.0%

MEG-WEST ws 27.00 27.00 +0.0% +0.0%

Avg. Suezmax TCE usd/day 8,008 7,051 +13.6% -0.8%


TD7 NSea-Cont ws 111.94 98.89 +13.2% +22.5%

TD7 NSea-Cont usd/day 10,771 2,688 +300.7% +1634.5%

TD17 Baltic-UKC ws 80.28 67.22 +19.4% +33.8%

TD17 Baltic-UKC usd/day 9,181 1,909 +380.9% +2087.2%

TD19 Med-Med ws 120.83 102.78 +17.6% +65.7%

TD19 Med-Med usd/day 14,340 7,349 +95% +1008.2%

TD8 Kuwait-China ws 114.72 103.33 +11.0% +35.7%

TD8 Kuwait-China usd/day 7,647 3,432 +122.8% +176.4%

TD9 Caribs-USG ws 95.83 102.50 -6.5% +7.0%

TD9 Caribs-USG usd/day -502 1,247 -140.3% -137.7%

Avg. Aframax TCE usd/day 8,417 4,081 +106.2% +567.5%


VLC

CSu

ezm

axA

fram

ax

tanker chartering banchero costa

Overall a positive week for VLCC owners in the MEG, activity picked up again and rates showed some shy improvement, moving up to around ws53 for East and in the low ws20s for West discharge. A stable flow of cargoes in West Africa allowed owners to prevent any further rate erosion in the region, WAF/East closed the week in the low ws50s. No real changes in the Caribs where a run to Singapore still pays around USD 3.8 mln. West African market for Suezmaxes has been giving some signs of improvement this week as charterers became more active, ending up pushing rates for UKC discharge in the mid ws60s. Some improvement recorded also for the Mediterranean market thanks to a stable demand that allowed rates to slowly increase up to about ws83 for the Black Sea/Med voyages. Aframax rates kept firming up in the Mediterranean as owners managed to keep going the momentum from last week. By Friday the Cross-Med reached ws120 but higher demand will be needed to push rates any higher than that. Something is finally moving in the North Sea where we've seen enough activity to move rates up to ws110 for the Cross-Continent and in the low ws80s off the Baltic. Caribs market recovered slightly after a very slow start of the week and the Caribs/USG finally settled around ws90.

Crude Oil Tanker Market

6

Rates


0

8,000

16,000

24,000

32,000

17/8/17 17/12/17 17/4/18 17/8/18

VLCC MEG-Far East (usd/day)

-10,000

0

10,000

20,000

30,000

17/8/17 17/12/17 17/4/18 17/8/18

TD6 Suexmax BSea-Med (usd/day)

-10,000

0

10,000

20,000

30,000

17/8/17 17/12/17 17/4/18 17/8/18

TD19 Aframax Med-Med (usd/day)

10,000

15,000

20,000

25,000

30,000

Aug-17 Nov-17 Feb-18 May-18 Aug-18

1 YR TC Period (usd/day)

VLCC Suezmax Aframax

12,000

13,000

14,000

15,000

16,000


1 YR TC Period (usd/day)

LR2 MR2

0

5,000

10,000

15,000

20,000

17/8/17 17/12/17 17/4/18 17/8/18

MR Pacific Basket (usd/day)

0

5,000

10,000

15,000

20,000

25,000

17/8/17 17/12/17 17/4/18 17/8/18

MR Atlantic Basket (usd/day)

0

5,000

10,000

15,000

20,000

17/8/17 17/12/17 17/4/18 17/8/18

TC1 LR2 MEG-Japan (usd/day)

tanker chartering banchero costa

Product Tanker Market

Delays at Turkish Straits for Daylight Restricted Vessels

Week 33 was a soft week for LR2s' East of Suez market, as MEG/F East trades saw low levels of activity and rates down up to ws 95 bss 75k mts; same was recorded for cargoes going West which closed the week at around USD 1.84 mln. MEG market for LR1s, due to a tonnage list getting thinner day after day, slightly improved and closed the week at ws102.5 for 55,000 Mt going F East and around USD 1.5 mln for Western destinations. Steady levels for West of Suez LR market, with 80,000 MT of naphtha reported from the Med to Japan reported at USD 1.625 mln and LR1 fixed from the Baltic to the MEG around USD 1.05 mln. Clean Handies market showed once again steady rates both in the Med and the Cont: the Cross-Med and the B Sea/Med trades remained still at ws120 and ws130 levels respectively and same has been recorded on the Baltic/UKC and the Cross-Cont routes which, despite good levels of activity, hold once again ws125 and ws115 basis 30,000 Mt. Clean MRs fixed from the Cont to Trans-Atlantic destinations ended the week losing a couple of points from last Friday, i.e. ws120 on 37,000 MT and, with quite a number of ships ballasting to Europe from the other side of the Atlantic, the US market jumped with back-hauls voyages to Europe gaining almost 20ws points up to the mid ws90's basis 38,000 Mt. The dirty market in the Med hasn’t been very exciting both for Handies and MRs. Just a few cargoes have been reported fixed during the first part of the week but, then, Thursday and Friday the situation became very quiet. The Cross-Med for 30,000 Mt stems paid ws165 on Monday, while on Friday ws155 was supposed to be the untasted level. On the MRs side, only a couple of cargoes have been fixed, the rate for 45,000 Mt remained around ws115/120 on the Cross-Med and ws120/125 from the B Sea. The UKC market for Handies, instead, recorded a quite active week with a short position list and rates for 30,000 Mt on the Cross-UKC reaching ws160-162.5 on Friday. Panamaxes were steady at ws110/115 level for the 55,000 Mt from Med/UKC range to TA.



TC1 MEG-Japan ( 7 5 k ) ws 96.3 99.9 -3.6% -18.3%

TC1 MEG-Japan ( 7 5 k ) usd/day 6,243 6,265 -0.4% -48.5%

TC8 MEG-UKC ( 6 5 k ) usd/mt 23.0 22.0 +4.4% +7.4%

TC5 MEG-Japan ( 5 5 k ) ws 100.3 95.6 +4.9% -21.2%

TC5 MEG-Japan ( 5 5 k ) usd/day 4,523 2,981 +51.7% -53.4%

TC2 Cont-USAC ( 3 7 k ) ws 119.4 120.0 -0.5% +16.2%

TC2 Cont-USAC ( 3 7 k ) usd/day 3,636 3,589 +1.3% +47.3%

TC14 USG-Cont ( 3 8 k ) ws 88.4 74.4 +18.9% -23.5%

TC14 USG-Cont ( 3 8 k ) usd/day -462 -2,770 +83.3% -110.4%

TC9 Baltic-UKC ( 2 2 k ) ws 125.0 125.4 -0.3% -1.7%

TC6 Med-Med ( 3 0 k ) ws 120.0 120.0 +0.0% +2.7%

TC7 Spore-ECAu ( 3 0 k ) ws 176.3 180.4 -2.3% -22.4%

TC7 Spore-ECAu ( 3 0 k ) usd/day 10,348 10,303 +0.4% -15.0%

TC11 SK-Spore ( 4 0 k ) usd/mt 8.26 8.47 -2.5% -0.8%

MR Pacific Basket usd/day 6,685 7,126 -6.2% -35.8%

MR Atlantic Basket usd/day 6,808 4,832 +40.9% -24.4%

LR2 1 Year TC Period usd/day 14,000 14,000 +0.0% -6.7%

MR2 1 Year TC Period usd/day 13,500 13,500 +0.0% +0.0%

TD12 Cont-USG ( 5 5 k ) ws 114.7 110.0 +4.3% +7.0%

TD18 Baltic-UKC ( 4 0 K) ws 163.3 158.3 +3.2% +31.5%

BSea-Med ( 3 0 k ) ws 160.0 187.5 -14.7% -4.5%

Med-Med ( 3 0 k ) ws 160.0 167.5 -4.5% +0.0%

Cle

anD

irty

Rates


Northbound days 1.5 1.5 +0.0% -25.0%

Southbound days 1.5 1.5 +0.0% -25.0%

600

700

800

900

1,000

17/8/17 17/12/17 17/4/18 17/8/18

Shanghai Container Freight Index

5,000

7,000

9,000

11,000

13,000

16/8/17 16/12/17 16/4/18 16/8/18

Geared - 1 YR TC Period (usd/day)

2500 1700 1100

6,000

8,000

10,000

12,000

14,000

16/8/17 16/12/17 16/4/18 16/8/18

Gearless - 1 YR TC Period (usd/day)

4250 3500 2700


ConTex index 498 503 -1.0% +29.0%

4250 teu (1Y, g’less) usd/day 12,248 12,346 -0.8% +55.0%



2500 teu (1Y, geared) usd/day 11,348 11,458 -1.0% +32.7%



Container activity has stabilised charter rates which can be considered in line with present holiday period. Some new fixtures have been concluded even in the medium-long term at stable rates. Feeder tonnage in range of 2,500/1,750 TEUs is maintaining positive levels achieved some months ago.

banchero costa containers

VHSS Containership Timecharter Assessment (source: Hamburg Shipbrokers’ Association)

Containership Market

Shanghai Containerized Freight Index (source: Shanghai Shipping Exchange)

8


Comprehensive Index index 892 894 -0.2% +3.7%

Services:

Shanghai - North Europe usd/teu 928 948 -2.1% +1.1%

Shanghai - Mediterranean usd/teu 909 895 +1.6% +9.4%

Shanghai - WC USA usd/feu 2,086 2,068 +0.9% +25.7%

Shanghai - EC USA usd/feu 3,317 3,102 +6.9% +28.0%

Shanghai - Dubai usd/teu 357 373 -4.3% -34.9%

Shanghai - Santos usd/teu 1,607 1,830 -12.2% -43.5%

Shanghai - Singapore usd/teu 140 136 +2.9% -13.0%


Recent Fixtures

Vessel Name Built TEUs TEU@14 Gear Fixture Period Rates

Northern Discovery 2008 3,534 2,353 gearless Hapag Lloyd 7/9 m ext. $11,550/d

Cordelia 2003 2,824 2,030 gearless EMC 6/8 m $10,750/d

TRF Kaya 2007 2,824 2,029 gearless WHL 3/6 m $11,400/d

Tiger 2005 2,524 1,854 geared Maersk 5/8 m $12,250/d

Kyoto Tower 2007 1,708 1,275 gearless TS Lines 1/3 m ext. $10,750/d

Okee August 1998 1,550 1,029 geared CMA-CGM 12 m $9,000/d

FPMC Container 9 2009 1,118 700 gearless SITC 1/3 m ext. $7,600/d

Okee Lilo 1998 951 585 geared CMA-CGM 6/8 m $6,900/d

100

105

110

115

120

17/8/17 17/12/17 17/4/18 17/8/18

Yen/USD Exchange

1.10

1.15

1.20

1.25

1.30

17/8/17 17/12/17 17/4/18 17/8/18

USD/Euro Exchange

20

30

40

50


Newbuilding Prices (usd mln)

Ultramax LR2 MR2

3 yrs 5 yrs 7 yrs 10 yrs 15 yrs 20 yrs

USD 2.85 2.87 2.89 2.93 2.96 2.97

Euro -0.01 0.27 0.55 0.90 1.25 1.39

Libor USD Libor Euro Euribor Euro

6 Months 2.51 -0.31 -0.27

12 Months 2.81 -0.22 -0.17

banchero costa

In the Dry Bulk segment Pan Ocean has been reported having signed 2 x 63,500 dwt Ultramaxes at New Times Shipyard with option for an additional unit. Vessels will be delivered during 2020 and the units should be Tier II fitted and scrubber ready.

In the gas segment, Celsius Shipping has placed an order for 2+2 180,000 cu.m LNG carriers at Samsung HI. Vessel will be delivered between the second half of 2020 and the first half of 2021.

In the container segment, CSBC Taiwan received an order by Yang Ming Marine for 10 + 4 feeder units of around 2,800 TEUs (included 600 reefer slots). These units are planned to be delivered monthly starting from the first half of 2020 up to the first half of 2021.

Newbuilding Market

Newbuilding Reported Orders

Indicative Newbuilding Prices (China)

sale & purchase

Interest Rates

Interest Rate Swaps

9

Unit 01-Aug-18 M-o-M Y-o-Y

Capesize usd mln 47.5 +0.8% +8.6%

Ultramax usd mln 26.0 +0.8% +9.0%

Supramax usd mln 22.9 +0.2% +9.0%

VLCC usd mln 82.6 +0.6% +6.9%

LR2 Coated usd mln 45.8 +1.1% +6.4%

MR2 Coated usd mln 33.6 +0.0% +2.0%

17-Aug 10-Aug W-o-W Y-o-Y

USD/Euro 1.14 1.15 -0.6% -2.6%

Yen/USD 110.5 110.8 -0.3% +0.8%

SK Won/USD 1,125 1,129 -0.4% -1.1%

Exchange Rates


Type Size Built Yard Buyers Price Comment

Cont 2,800 2H 2020 CSBC Yang Ming 35.0 10 + 2 + 2 Tier II

Bulk 63,500 2H 2020 New Times Pan Ocean 26.5 2 + 1 units

LNG 180,000 2020/21 Samsung Celsius Shipping 187.0 2 + 2 units

TYPE VESSEL NAME DWT BLT YARD BUYERS PRICE NOTE

Bulk Ocean Scorpio 82,000 2013

Yanggfan Zhoushan Chinese buyers 17.5

On subs. En bloc deal with Ocean Virgo and Ocean Libra. Price each.

Bulk Ocean Virgo 82,000 2012

Bulk Ocean Libra 82,000 2013

Bulk Ocean Broaden 63,562 2013 Taizhou Kouan Hong Kong buyers 15.7

Bulk EM Crystal 57,353 2011 STX Dalian Chinese buyers 12.0

Bulk Nautical Aventurin 56,778 2012 Jiangsu New

Hantong Greek buyers 13.55

Bulk Ocean Glory 45,499 2000 Imabari Undisclosed 6.0

Bulk Gloria Island 28,000 2012 I-S Shipyard C of Order 10.0

350

400

450

500

20/8/17 20/12/17 20/4/18 20/8/18

SubCon Demo Assessment (usd/ldt)

Dirty Tnk Clean Tnk Dry Bulk

15

20

25

30

35

20/8/17 20/12/17 20/4/18 20/8/18

Secondhand Values (usd mln)

Panamax Aframax MR


Dry Bulk usd/ldt 423.5 419.0 +1.1% +9.1%

Dirty Tanker usd/ldt 435.0 435.5 -0.1% +8.5%

Clean Tanker usd/ldt 432.0 432.0 +0.0% +8.5%

sale & purchase banchero costa

Secondhand Market

Baltic Secondhand Assessments

Baltic Demolition Assessment (Subcontinent)

10


Capesize usd mln 36.4 63.3 -42.6% +15.6%

Panamax usd mln 21.9 21.9 +0.0% +14.1%

Supramax usd mln 18.5 18.5 +0.0% +15.4%

VLCC usd mln 61.9 61.9 +0.1% +0.9%

Aframax usd mln 29.9 29.9 +0.2% +1.8%

MR Product usd mln 26.0 26.0 +0.1% +9.6%


The secondhand market showed a very steady week with just few deal closed. On the Dry Bulk market three modern Kamsarmax "OCEAN VIRGO", "OCEAN LIBRA", "OCEAN SCORPIO" 81,000 dwt built 2012/13/13 Yangfan have been reported sold within Chinese buyers for around USD 17.5 mln each. A previous sale failed in March with levels around USD 19 mln at that time.

On the same note, an Ultramax "OCEAN BROADEN" 63,500 dwt 2013 Kouan Shipyard has been sold for “just” USD 15.7 mln, proving that prices have been softening for Chinese built Vessels.

Finally, a smaller 28,000 dwt "GLORIA ISLAND" I-S Shipyard built 2012 has been sold to Order Shipping (Greece) for region USD 10.3 mln

The S&P tanker market is extremely slow and lazy, most of the recent transactions have showed leasing companies as active buyers. We only would suggest that LR2 "SIGMA INTEGRITY" may have failed to Latsco at USD 21.5 mln a few weeks back and now sold at a lower USD 20.0 mln to undisclosed (same?) buyers.

Secondhand Reported Sales

news banchero costa

China steel mills shrug off anti-smog measures, push output to 4th straight record China's steel output rose in July to a fourth straight monthly record as mills ran full tilt to cash in on strong profit margins, despite anti-smog measures imposed by local governments. Mills in China, the world's top steel producer, churned out 81.24 million tonnes of crude steel last month, up 1.3 percent from June and 7.2 percent from the same month last year, data from the National Bureau of Statistics showed on Tuesday. China's Jiangsu province to consolidate steel mill locations in efficiency drive China's second-largest steelmaking province, Jiangsu, will require steel mills to move to two new areas on the coast in the next few years, according to a provincial government document, to reduce air pollution and to make the industry more efficient. After years of getting rid of outdated excess capacity, the latest measures are the next front in the government's long-term effort to upgrade and streamline its smokestack industries. Canada to consider steel safeguard response to U.S. tariffs Canada said it will consider a safeguard action on seven steel products to protect domestic producers from imports since the United States imposed tariffs against its major trade partner in March. Finance Minister Bill Morneau said a 15-day consultation period will be used to look at the harm or threat of harm to seven steel categories, including steel plate, rebar, energy tubular product, hot rolled sheet, pre-painted steel, stainless steel wire and wire rod. Japan, South Korea steel exports to India surge on tariffs, high-end demand India is being hit by a wave of steel from producers in Japan and South Korea, a government document showed, as mills there redirect supply after U.S. President Donald Trump slapped an import duty on the alloy earlier this year. During the first quarter of the fiscal year starting in April, India's steel imports from South Korea rose 31 percent from a year earlier, while those from Japan climbed 30 percent, according to an internal document from the Ministry of Steel that was reviewed by Reuters. Lira volatility leaves thermal coal traders hesitant to participate in Turkish market European thermal coal traders have been hesitant to participate in the Turkish market amid the ongoing lira/dollar depreciation, despite demand from utilities, sources said. "The terms of business will change," said a European trader, explaining he would be reluctant to sell to a buyer in Turkey without credit protection. Despite being exposed to currency fluctuations, utilities in Turkey remain in need of coal, owing to the recent period of high-burn and strong gas prices. China coal output hits lowest in years, but heatwave boosts power generation China's coal output fell 2 percent in July to its lowest in years as Beijing's crackdown on polluting industries crimped mining in the world's top consumer of the fuel, driving import demand as hot weather boosted thermal power generation. The country produced 281.5 million tonnes of coal in July, down 2 percent from the same month last year and the lowest since September 2016, the National Bureau of Statistics said on Tuesday. Chinese buyers cool to Beijing's additional 25% import tariff on US coking coal Chinese coking coal buyers were unfazed by Beijing's slapping of an additional 25% import tariff on $16 billion worth of US products – including coking coal, coke and thermal coal -- from August 23, given ample availability of alternative supplies. Besides, the voyage time from the US East Coast to eastern China's Qingdao is significantly longer at 40-45 days, compared to Australian coal which takes about 14 days from Hay Point to Qingdao. Argentina suspends cuts in soymeal, soyoil export taxes Argentina has suspended for six months its program of gradually cutting taxes on exports of soymeal and soyoil, the Treasury Ministry said in a statement, part of the government's fiscal tightening program. International shipments of both soy products are currently taxed at 23 percent, lowered gradually from 32 percent in 2015, the statement said. Ukraine exports wheat mostly to Asia, the Middle East in July Asian and Middle East countries were the leading buyers of Ukrainian wheat in July, the first month of the new 2018/19 season, data by analyst UkrAgroConsult showed on Wednesday. Ukraine is among the world's major wheat exporters and sold a total of 17.2 million tonnes of wheat abroad in the previous 2017/18 season. South Africa hikes sugar import duties to protect local industry South Africa has raised import duties on sugar to $680 from $566 a tonne to protect the domestic industry against a surge in imports, the trade and industry minister said on Wednesday. The South African Sugar Association applied in February to have the tariff raised to $856 a tonne, but the International Trade Administration Commission of South Africa (ITAC), which conducts customs tariff investigations and proposes trade remedies, set a lower import duty. Source: Thomson Reuters/ Platts

Dry Bulk Commodities


news banchero costa

Oil & Gas Saudi cuts oil output as OPEC points to 2019 surplus OPEC forecast lower demand for its crude next year as rivals pump more and said top oil exporter Saudi Arabia, eager to avoid a return of oversupply, had cut production. In a monthly report, the Organization of the Petroleum Exporting Countries said the world will need 32.05 million barrels per day (bpd) of crude from its 15 members in 2019, down 130,000 bpd from last month's forecast. Saudi pips Iraq as top oil supplier to India in July- data Saudi Arabia replaced Iraq as top oil supplier to India in July after a gap of more than a year, according to data from industry and shipping sources, as a higher intake of Iranian oil ahead of U.S. sanctions altered trade routes. Many European refiners are winding down purchases of Iranian oil after the United States imposed sanctions on Tehran, leading to higher supplies to Asia, mainly India and China. S.Korea's July crude oil imports from Iran fall over 40 pct y/y South Korea's imports of Iranian crude dropped 43.5 percent in July from a year earlier, with buying fading amid looming U.S. sanctions against supply from the Middle Eastern nation. South Korea shipped in 788,651 tonnes of crude oil from Iran last month, or 186,478 barrels per day (bpd), customs office data showed on Wednesday. Japan crude imports for July hit 29-year low Japan's customs-cleared crude oil imports fell 10.2 percent in July from the same month a year earlier, the Ministry of Finance said. Japan, the world's fourth-biggest crude buyer, imported 2.9 million barrels per day (14.292 million kilolitres) of crude oil last month. Crude imports marked their lowest volumes for the month of July since 1989 amid shrinking oil demand due to a declining population and prevalence of more efficient vehicles and equipment Japan's Fuji Oil buys more Mideast crude for Oct to replace Iran oil Japanese refiner Fuji Oil has bought 2.5 million barrels of Middle East crude for October loading via a tender and is seeking more oil to replace Iranian supplies, several trade sources said on Thursday. Fuji Oil bought 1 million barrels of Banoco Arab Medium crude at premiums of about 15 cents a barrel to its official selling price (OSP) and another 1 million barrels of Qatar Land crude at discounts of 50 cents and 70 cents a barrel to its OSP, they said. Chinese oil importers shun U.S. crude despite tariff reversal Chinese oil importers are shying away from buying U.S. crude as they fear Beijing's decision to exclude the commodity from its tariff list in a trade dispute between the world's biggest economies may only be temporary. Not a single tanker has loaded crude oil from the United States bound for China since the start of August, Thomson Reuters Eikon ship tracking data showed, compared with about 300,000 barrels per day (bpd) in June and July. China oil refinery output up 12 pct in July, buoyed by state refiners Chinese oil refinery output rose 11.6 percent in July from a year earlier, government data showed on Tuesday, with state-run plants operating at high rates but smaller independent refiners struggling with squeezed profit margins. Refinery throughput last month reached 50.95 million tonnes, or 11.95 million barrels per day (bpd), according to the data from the National Bureau of Statistics. That compared to 12.11 million bpd in June. U.S. crude stockpiles soar unexpectedly despite record refinery runs - EIA U.S. crude oil stockpiles jumped unexpectedly last week despite record high refinery runs, while gasoline stocks decreased and distillate inventories grew, the Energy Information Administration said on Wednesday. "We've gotten hit by a wall of crude," said Phil Flynn, an analyst at Price Futures Group in Chicago. "This is really unheard of to have refiners running at 98 percent at this time of year and have it not impacting the crude stockpiles." India's Reliance declares force majeure on gasoline from Jamnagar plant – sources India's Reliance Industries, which operates the world's largest refining complex, has declared force majeure on gasoline exports from its Jamnagar site, four people familiar with the matter said on Wednesday, potentially boosting margins for other suppliers of the oil product. The force majeure follows an unspecified issue at a gasoline-producing fluid catalytic cracker (FCC) unit in its export-oriented refinery with a capacity of more than 500,000 barrels per day (bpd) in the special economic zone in Jamnagar, two of the people said. Japan steps up U.S. LPG purchases in fallout from Sino-U.S. trade conflict Japanese utilities and industrial companies are snapping up U.S. cargoes of liquefied petroleum gas (LPG) that are seeking a new home after Chinese buyers started to shun them amid an escalating trade war between Washington and Beijing. Taking in fuel that would otherwise be heading for China means Japanese imports of U.S. LPG are set to stay strong after already hitting record levels earlier this year. Source: Thomson Reuters/ Platts

market report - week 33/2018 12

300

400

500

600

17/8/17 17/12/17 17/4/18 17/8/18

Wheat and Corn Prices (usd/t)

Corn Wheat

3,000

3,500

4,000

4,500

5,000

17/8/17 17/12/17 17/4/18 17/8/18

Steel Prices in China (rmb/t)

Rebar Plate

40

60

80

100

120

17/8/17 17/12/17 17/4/18 17/8/18

Iron Ore and Coal Prices (usd/t)

Steam Coal Iron Ore

40

50

60

70

80

90

17/8/17 17/12/17 17/4/18 17/8/18

Brent and WTI Oil Prices (usd/bbl)

Brent WTI

200

400

600

800

17/8/17 17/12/17 17/4/18 17/8/18

Bunker Prices @ Singapore (usd/t)

IFO 380 IFO 180 MGO


Wheat usd/t 557.5 546.3 +2.1% +33.5%

Corn usd/t 365.3 355.3 +2.8% +4.0%

Soybeans usd/t 893.8 846.0 +5.6% -4.7%

Palm Oil usd/t 545.6 548.0 -0.4% -12.7%


Iron Ore (Platts) usd/t 68.0 68.6 -0.9% -9.2%

Iron Ore China @Tangshan rmb/t 511.0 515.0 -0.8% -7.9%

Rebar in China rmb/t 4,437 4,335 +2.4% +7.9%

Plate in China rmb/t 4,442 4,357 +2.0% +4.0%

HR Coil in China rmb/t 4,424 4,398 +0.6% +6.0%

CR Sheet in China rmb/t 4,781 4,725 +1.2% +2.4%


Steam @ Richards Bay usd/t 100.0 101.7 -1.7% +14.9%

Steam @ Newcastle usd/t 118.0 116.7 +1.2% +20.0%

Coking Coal Australia usd/t 181.0 180.8 +0.1% -6.3%


Crude Oil Brent usd/bbl 71.6 72.7 -1.4% +35.6%

Crude Oil WTI usd/bbl 65.8 67.7 -2.8% +35.2%

Crude Oil Dubai usd/bbl 70.6 71.4 -1.1% +43.0%

Natural Gas Henry Hub usd/mmbtu 2.92 2.93 -0.3% +1.0%

Gasoline Nymex usd/gal 1.98 2.04 -2.9% +22.2%

ICE Gasoil usd/t 644.8 655.5 -1.6% +34.0%

Naphtha Tokyo usd/t 643.0 648.5 -0.8% +37.2%

Jet-Kerosene Asia usd/bbl 86.1 86.8 -0.8% +37.6%


Rotterdam usd/t 411.5 422.5 -2.6% +40.0%

Gibraltar usd/t 442.5 450.5 -1.8% +42.1%

Singapore usd/t 454.0 467.5 -2.9% +47.4%

Rotterdam usd/t 454.0 462.0 -1.7% +39.3%

Gibraltar usd/t 469.5 481.0 -2.4% +44.9%

Singapore usd/t 489.0 499.5 -2.1% +45.3%

Rotterdam usd/t 621.0 622.0 -0.2% +36.3%

Gibraltar usd/t 677.0 677.0 +0.0% +35.8%

Singapore usd/t 656.5 658.0 -0.2% +39.7%

IFO

38

0IF

O 1

80

MG

O

banchero costa commodities

Oil & Gas Prices

Coal Prices

Iron Ore and Steel Prices

Agricultural

Bunker Prices


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Documents

BANCOSTA Weekly Market Report · According to the Iranian Steel Producers’ Association (ISPA), the country plans to increase their annual steel production capacity to 55 million