BANCOSTA Weekly Market Report · grain exporters association ANEC, Brazil may also import up to 1 million tonnes of U.S. soybeans , with ... P1 Transatlantic r/v usd/day 13,300 10,222

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Weekly Market Report

Week 28/2018 (9 July – 13 July)

Comment: Trade war impact on grain & soybean trade

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2 market report - week 28/2018

In recent months, the trade war started by the U.S. Trump administration has been escalating. Most recently on 6 July, the U.S. imposed tariffs on $34 billion worth of Chinese goods, to which China responded in kind immediately after the U.S. tariffs went into place. The Trump administration has since threatened to slap tariffs on another $200 billion worth of Chinese imports.

However, the targets of the U.S. tariffs have not been limited to just China. At the end of May, the U.S. lifted exemptions for steel and aluminium tariffs (originally imposed in March on China and other countries) for the E.U., Canada, and Mexico, triggering a wave of retaliation from them too.

Scale of impact on grain and soybean trade

The impact of the trade war on the grains and soybean trade has been an area of focus, as China included corn, soybean, sorghum and wheat in its list of U.S. goods that now face a 25% tariff. China imports around 60% of the soybeans traded worldwide, and purchases from the U.S. had come in at around 32.9 million tonnes last year, accounting for 34% of Chinese soybean imports. Imports of sorghum, wheat, and corn from the U.S. summed up to another 7.1 million tonnes in 2017, accounting for 58% of such grain imports by China. According to data from the U.S. Department of Agriculture (USDA), Chinese purchases of U.S. soybeans have already fallen by 8.0 million tonnes year-on-year in the current 2017/18 market season that ends in August.

While the E.U. has also retaliated with a 25% tariff on U.S. corn in June, the impact of this on the overall grain trade is expected to be relatively small. In 2017, the E.U. imported 0.8 million tonnes of corn from the U.S., accounting for just 5 percent of their total corn imports.

Reshuffle in the grain and soybean trade is expected, with multiple possible iterations emerging

For China, the most obvious solution has been to seek increased soybean imports from the world’s largest exporter Brazil, as well as other major exporters Argentina and Paraguay. Both Brazil and Argentina are also the next largest exporters of corn after the U.S..

However, with domestic supplies at these exporters unlikely to be sufficient in fully filling the gap left by the U.S., Brazil and Argentina have been preparing to purchase U.S. soybeans to feed their domestic processors, or even to re-export them. According to data from the USDA, Argentina has committed to buying 0.6 million tonnes from the U.S. in the 2018/19 season that starts in September, adding to purchases of 89,000 tonnes this season. According to Brazilian grain exporters association ANEC, Brazil may also import up to 1 million tonnes of U.S. soybeans, with purchases expected to ramp up in October.

Major sellers in the Black Sea – Russia, Ukraine and Kazakhstan – have also been touted as some of the potential winners of the ongoing trade war, as they look to sell more wheat, corn, and soybean to the Chinese and European markets. In the first 5 months of 2018, Russia has exported 0.46 million tonnes of soybean to China, compared to just 0.17 million tonnes the same period a year ago. Russian wheat exports to the E.U. have also seen a strong increase to 0.87 million tonnes over Jan-May 2018, compared to 0.30 million tonnes during the same period in 2017.

However, sellers in the Black Sea are mainly major exporters of wheat, and are unlikely to be able to fully meet the soybean demand gap left by the tariffs. Russia’s total wheat exports in 2017 amounted to 33.1 million tonnes, compared to just 0.5 million tonnes of soybean exports during the year. Even for wheat, there has also been concerns that Black Sea supplies may not be able to fully replace U.S. wheat due to quality differences and challenging logistics.

Meanwhile, other importers have also been taking advantage of the cheap U.S. soybean supplies to stock up. According to USDA data, purchases of U.S. soybean more than doubled in Egypt and Pakistan in the current marketing season to 2.1 million tonnes and 1.4 million tonnes respectively. Purchases by Taiwan, Vietnam, and Thailand also saw strong increases of between 40-80% year-on-year, to 1.5 million tonnes, 1.0 million tonnes, 1.2 million tonnes respectively.

Should the tariffs remain in place and escalate, the grains and soybean trade is expected to see a reshuffle employing parts, if not all of these iterations and more – a development that may increase either challenges or opportunities depending on how ship operators choose to position their vessels.

Trade war impact on grain & soybean trade

Unit 13-Jul 06-Jul W-o-W Y-o-Y

BCI TC Avg. usd/day 24,287 24,273 +0.1% +215.4%

C8 Transatlantic r/v usd/day 29,675 29,350 +1.1% +417.3%

C14 China-Brazil r/v usd/day 21,686 22,227 -2.4% +146.2%

C10 Pacific r/v usd/day 20,792 20,729 +0.3% +164.4%

1 Year TC Period usd/day 25,000 20,000 +25.0% +108.3%

dry cargo chartering banchero costa

Capesize market recorded a strong growth in all the areas.

In the Atlantic basin, the standard route from Tubarao to Qingdao route reached around low/mid USD 22.0 pmt for the second half of August, while in the Pacific the key trade from West Australia to China fixed close to USD 9 pmt.

Short period market priced all the expectations for the remaining part of the year and went up to mid usd 20,000/d for modern eco type ships on a duration of 5 to 8 months.

Similarly, North Atlantic market settled the week over usd 30,000/d for round in the Atlantic Ocean and in the low/mid usd 40,000/d for the fronthaul.

Capesize Market

Rates

Panamax Market

Rates

An excellent week was registered in the Atlantic basin with rates that improved steadily. Many vessels were fixed reducing the list of spot tonnage in N Atlantic, stronger demand of minerals on TransAtlantic trades and a good amount of fronthaul business created some strong good feeling for owners.

Rates around $25,000/d were registered on Kamsarmax on fronthaul at the closing, Panamax with grains were fixing around $23,000/d and a number of Panamax fixing at $16,000/d for short rounds in Cont. ECSAm was rather quiet and rates remained flat around $16,000/d + 600,000 bb.

Rates in Pacific were still under pressure, especially in North Pacific, due to a lack of fresh enquiries. Only Indonesia and Australian mineral demand was enough to avoid a fall. Period activity was there with stronger rates, especially on Kamsarmax which were fixing at $14,000/d for 7/9 months.

3

0

7,000

14,000

21,000

28,000

35,000

13/7/17 13/11/17 13/3/18 13/7/18

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

13/7/17 13/11/17 13/3/18 13/7/18

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

1-YR TC BPI TC

market report - week 28/2018


BPI TC Avg. usd/day 12,233 10,821 +13.0% +33.7%

BPI 82 TC Avg. usd/day 10,756 10,628 +1.2% n.a.

P1 Transatlantic r/v usd/day 13,300 10,222 +30.1% +41.7%

P2 Skaw-Gib Trip East usd/day 20,614 18,235 +13.0% +34.8%

P3 Pacific r/v usd/day 9,931 9,721 +2.2% +14.4%

1 Yr TC Period Panamax usd/day 12,500 12,500 +0.0% +35.1%

1 Yr TC Period Kamsarmax usd/day 14,000 14,000 +0.0% +33.3%

dry cargo chartering banchero costa

The market showed improvements from US Atlantic and USG with more business concluded, most of it to Europe and S Brazil. Ultramax were fixing around $17,500/18,000/d for dirty cargoes to Europe and around $17,000/d for grains. Very few cargoes were available for F East and Middle East directions. Rates for USG/Turkey went up to $19.5/19.75/mt, some $0.50/mt less for NCSAm discharge. ECSAm market showed to be still alive and improved significantly. Tess58 types were seeing $14,500/d basis dely aps ECSAm for trips to Med and $14,000/d to Cont. Trips to F East on Supramax were around $14,750/d + 475,000 bb and Ultramax were asking $15,250/d + 525,000 bb. The Handysize market was not as healthy with many units spot, but owners are expecting improvements in the coming week, hence remained reluctant to fix; 35,000 dwt were fixed around $11,500/12,000/d for trips to the Cont/Med range.

Supramax & Handysize Market

N E

uro

pe

Me

dit

err

ane

an

Ind

ia

S A

fric

a

Activity improved significantly in the Med/BSea area compared to the previous week, especially on Supramax. Fronthaul rates rose from $15,000/d to $17/18,000/d and W African destinations went over $11,000/d from $9/10,000/d. Handysize rates increased too and rates for BSea-Cont easily achieved $7,500/d in a couple of days. Also the Cont market slightly improved for Handysize and Supramax, but not many fixtures were reported. A Tess58 was reported fixed at $13,500/d with scrap to E Med, a rate hike of at least $1,000/d compared to the previous week. Fronthaul was fixed around $18,000/d basis dely Cont redely Spore/Japan range with clean cargo. Handysize rates were around $12,000/d for E Med destinations and around $16,000/d for fronthauls on modern 35,000 dwt.

The market kept the negative trend of the previous week. From UAE a 57,000 dwt was fixed in the mid $12,000/d level basis dely aps Mina Saqr to WC India, then a 56,000 dwt open WCI was rumoured for similar business at $12,000/d basis dely aps. A Korean controlled 56,000 dwt open WC India was fixed in the mid $12,000/d basis dely aps UAE to WC India with limestones. A 57,000 dwt open WC India/Pakistan range was fixed at $11,000/d for costal WC India trip.

From S Africa early in the week a 56,000 dwt was rumoured at low $12,000/d + 200,000 bb for RBCT to MEG/WC India. Towards the end of the week the number of units in MEG decreased the amount of fresh cargoes, petcoke, sulphur and limestone improved leading to believe that the market will recover soon.

Far

East

P

acif

ic

The market kept the same trend of the previous week, slowing down both on Supramax and Handysize. A modern 63,000dwt was fixed at the end of the week for a RV with coal via Indonesia and redely China at $10,500/d; the same rate was then fixed on a 56,000 dwt basis dely Singapore.

Compared to this trade, a tick lower rates were registered for trips to MEG from N China basis modern tonnage. Handysize rates were around $8/8,500/d, basis modern Imabari 28,000 dwt, with dely SE Asia and redely China and a tick lower on the opposite routes.

US

Atl

anti

c

Sou

th A

mer

ica

4

0

4,000

8,000

12,000

16,000

13/7/17 13/11/17 13/3/18 13/7/18

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

1-YR TC BSI TC

0

3,000

6,000

9,000

12,000

13/7/17 13/11/17 13/3/18 13/7/18

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

1-YR TC BHSI TC



BSI TC Avg. usd/day 10,923 10,892 +0.3% +26.4%

S4A 58 USG-Skaw/Pass usd/day 16,100 15,369 +4.8% +18.6%

S9 58 WAF-ECSA-Med usd/day 9,396 9,229 +1.8% +13.5%

S1B 58 Canakkale-FEast usd/day 18,096 15,429 +17.3% +27.6%

S11 58 Pacific r/v usd/day 9,725 10,244 -5.1% +28.8%


BHSI TC Avg. usd/day 8,175 8,238 -0.8% +15.6%


Sup

ram

axH

and

y

Rates

Unit 13-Jul 06-Jul W-o-WPremium/

Discount

Jul (18) usd/day 20,460 20,460 +0.0% -15.8%

Aug (18) usd/day 18,810 18,810 +0.0% -22.6%

Sep (18) usd/day 20,830 20,830 +0.0% -14.2%

Q4 (18) usd/day 23,210 23,210 +0.0% -4.4%

Q1 (19) usd/day 14,290 14,290 +0.0% -41.2%

Q2 (19) usd/day 15,960 15,960 +0.0% -34.3%

Cal 19 usd/day 19,218 19,218 +0.0% -20.9%

Cal 20 usd/day 18,980 18,980 +0.0% -21.9%

Cal 21 usd/day 16,560 16,560 +0.0% -31.8%

Jul (18) usd/day 11,265 11,265 +0.0% -7.9%

Aug (18) usd/day 11,740 11,740 +0.0% -4.0%

Sep (18) usd/day 12,330 12,330 +0.0% +0.8%

Q4 (18) usd/day 12,685 12,685 +0.0% +3.7%

Q1 (19) usd/day 11,280 11,280 +0.0% -7.8%

Q2 (19) usd/day 12,440 12,440 +0.0% +1.7%

Cal 19 usd/day 12,368 12,368 +0.0% +1.1%

Cal 20 usd/day 11,845 11,845 +0.0% -3.2%

Cal 21 usd/day 10,120 10,120 +0.0% -17.3%

Jul (18) usd/day 11,270 11,270 +0.0% +3.2%

Aug (18) usd/day 11,790 11,790 +0.0% +7.9%

Sep (18) usd/day 12,070 12,070 +0.0% +10.5%

Q4 (18) usd/day 12,580 12,580 +0.0% +15.2%

Q1 (19) usd/day 11,150 11,150 +0.0% +2.1%

Q2 (19) usd/day 11,830 11,830 +0.0% +8.3%

Cal 19 usd/day 12,060 12,060 +0.0% +10.4%

Cal 20 usd/day 11,660 11,660 +0.0% +6.7%

Cal 21 usd/day 10,480 10,480 +0.0% -4.1%

Jul (18) usd/day 8,438 8,438 +0.0% +3.2%

Aug (18) usd/day 9,225 9,225 +0.0% +12.8%

Sep (18) usd/day 9,613 9,613 +0.0% +17.6%

Q4 (18) usd/day 9,850 9,850 +0.0% +20.5%

Q1 (19) usd/day 8,950 8,950 +0.0% +9.5%

Q2 (19) usd/day 9,475 9,475 +0.0% +15.9%

Cal 19 usd/day 9,463 9,463 +0.0% +15.8%

Cal 20 usd/day 9,238 9,238 +0.0% +13.0%

Cal 21 usd/day 9,188 9,188 +0.0% +12.4%

Han

dys

ize

Cap

esi

zeP

anam

axSu

pra

max

0

3,000

6,000

9,000

12,000

Jul-17 Jul-18 Jul-19 Jul-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 18.55 19.86 -6.6% -27.4%

TD1 MEG-USG usd/day -16,417 -15,270 -7.5% -455.8%

TD2 MEG-Spore ws 48.21 51.17 -5.8% -13.3%

TD3C MEG-China ws 47.50 50.75 -6.4% -12.7%

TD3C MEG-China usd/day 9,083 11,768 -22.8% -48.8%

TD15 WAF-China ws 48.83 51.21 -4.6% -13.5%

Avg. VLCC TCE usd/day -3,667 -1,751 -109.4% -138.6%

1 Year TC Period usd/day 20,000 20,000 +0.0% -23.1%

TD6 BSea-Med ws 86.39 85.64 +0.9% +19.1%

TD6 BSea-Med usd/day 10,723 9,264 +15.7% +65.2%

TD20 WAF-Cont ws 69.68 73.64 -5.4% +10.2%

MEG-EAST ws 68.00 72.00 -5.6% +1.5%

MEG-WEST ws 30.00 34.00 -11.8% +11.1%

Avg. Suezmax TCE usd/day 9,188 8,780 +4.6% +26.4%


TD7 NSea-Cont ws 120.83 112.78 +7.1% +25.7%

TD7 NSea-Cont usd/day 14,868 8,679 +71.3% +165.0%

TD17 Baltic-UKC ws 95.00 85.00 +11.8% +54.0%

TD17 Baltic-UKC usd/day 16,018 9,494 +68.7% +673.8%

TD19 Med-Med ws 140.56 94.00 +49.5% +72.3%

TD19 Med-Med usd/day 21,031 2,714 +675% +737.6%

TD8 Kuwait-China ws 102.06 100.33 +1.7% +11.4%

TD8 Kuwait-China usd/day 3,804 3,231 +17.7% -26.5%

TD9 Caribs-USG ws 101.11 111.39 -9.2% +22.6%

TD9 Caribs-USG usd/day 2,555 4,818 -47.0% +607.8%

Avg. Aframax TCE usd/day 10,831 5,945 +82.2% +186.1%


VLC

CSu

ezm

axA

fram

ax

tanker chartering banchero costa

Demand for VLCCs was seen remaining at a good level this week in the MEG, but the number of available vessels prevented any freight improvement. Rates actually softened a little, down to the high ws40s for East and in the high ws10s for Western discharge. Rates went down also off West Africa, not that much going on and WAF/East bottoming around ws47.5. No joy for owners in the Caribs either, very few fresh cargoes to fix and rates for Singapore discharge ending up around USD 3.0 mln. Not much going on also for Suezmaxes off West Africa and charterers managed to break owners' resistance quite easily, pushing rates for the UKC discharge down just below ws70. Has been another positive week in terms of cargo movements in the Mediterranean, but rates improvement has been only marginal, reaching slightly better than ws85 off the Black Sea. A very active week for Aframaxes in the Med, with plenty of cargoes in the market also thanks to a particularly busy Libya. Rates quickly firmed up to about ws140 for the Cross-Med. Positive week for owners also in the N Sea where rates have been slowly but steadily improving up to about ws120 for the Cross-Cont and close to ws100 off the Baltic. Another pretty quiet week and rates further softened down to around ws 100 for Caribs/USG voyages.

Crude Oil Tanker Market

6

Rates


0

8,000

16,000

24,000

32,000

13/7/17 13/11/17 13/3/18 13/7/18

VLCC MEG-Far East (usd/day)

-10,000

0

10,000

20,000

30,000

13/7/17 13/11/17 13/3/18 13/7/18

TD6 Suexmax BSea-Med (usd/day)

-10,000

0

10,000

20,000

30,000

13/7/17 13/11/17 13/3/18 13/7/18

TD19 Aframax Med-Med (usd/day)

10,000

15,000

20,000

25,000

30,000

Jul-17 Oct-17 Jan-18 Apr-18 Jul-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

13/7/17 13/11/17 13/3/18 13/7/18

MR Pacific Basket (usd/day)

0

5,000

10,000

15,000

20,000

25,000

13/7/17 13/11/17 13/3/18 13/7/18

MR Atlantic Basket (usd/day)

0

5,000

10,000

15,000

20,000

13/7/17 13/11/17 13/3/18 13/7/18

TC1 LR2 MEG-Japan (usd/day)

tanker chartering banchero costa

Product Tanker Market

Delays at Turkish Straits for Daylight Restricted Vessels

In the East of Suez, finally LR2 were able to increase their rates and closed the week at ws105 for a MEG/ Japan voyage basis 75,000 mt (equal to about $8,500/d TCE), and USD 1.95 mln for the MEG/UKC voyages. LR1 segment did not see any changes, and maintained ws120 (equal to about $7,000/d TCE) for eastward voyages basis 55,000 tons. Another flat week in the West of Suez, where LR1 and LR2 were still fixing respectively at USD 1.3 mln and USD 1.8 mln for a UKC/Japan voyage. The clean Handy market kept steady levels in the Med as rates maintained ws130 for 30,000 mt on the Cross-Med and the usual 10 ws points more for the B Sea-Med fixtures. The market in the Cont recorded a good number of fixtures for Med discharge, that could possibly change next week scenario in terms of tonnage. Otherwise, rates for the Baltic/UKC and the Cross-UKC trades held same rates' levels of previous week as well, so ws130 and ws120 respectively. Clean MRs market from Europe going West eased to ws100 level basis 37,000 mt while rates for W Africa discharge were assessed at ws110. The 38,000 mt clean cargoes fixed on the US/TA routes maintained steady at ws87.5/90 level. The Med market for dirty Handies/MRs has been quiet during the first part of the week and then it became suddenly busy during the second part especially from the B Sea. Due to the availability of tonnage the rates for Handies didn’t move anyway and 30,000 mt on the Cross-Med remained at ws130 and at ws140 from the B Sea. The MRs market, instead, showed ws120 bss 45,000 mt on the Cross-Med, due to the amount of cargoes available and rates for Aframaxes going up. In the UKC the market remained quiet for the all week and the Cross-Cont basis 30,000 mt still holds at ws150 level. From the Panamax side, another quiet week has been recorded, with rates sliding down to ws95 bss 55,000 mt from both the Med and the UKC.



TC1 MEG-Japan ( 7 5 k ) ws 104.7 101.6 +3.0% +11.8%

TC1 MEG-Japan ( 7 5 k ) usd/day 7,774 6,912 +12.5% +1.2%

TC8 MEG-UKC ( 6 5 k ) usd/mt 25.6 25.8 -0.8% +43.7%

TC5 MEG-Japan ( 5 5 k ) ws 119.7 120.3 -0.5% +7.4%

TC5 MEG-Japan ( 5 5 k ) usd/day 7,624 7,655 -0.4% -1.9%

TC2 Cont-USAC ( 3 7 k ) ws 100.0 105.8 -5.5% -24.7%

TC2 Cont-USAC ( 3 7 k ) usd/day 569 829 -31.4% -92.1%

TC14 USG-Cont ( 3 8 k ) ws 85.6 89.7 -4.5% -23.5%

TC14 USG-Cont ( 3 8 k ) usd/day -1,151 -1,121 -2.7% -124.9%

TC9 Baltic-UKC ( 2 2 k ) ws 130.0 130.0 +0.0% -9.5%

TC6 Med-Med ( 3 0 k ) ws 130.0 130.0 +0.0% -4.9%

TC7 Spore-ECAu ( 3 0 k ) ws 177.6 174.5 +1.8% -18.7%

TC7 Spore-ECAu ( 3 0 k ) usd/day 10,094 9,658 +4.5% -14.1%

TC11 SK-Spore ( 4 0 k ) usd/mt 9.61 8.77 +9.6% +11.1%

MR Pacific Basket usd/day 9,972 7,086 +40.7% +1.4%

MR Atlantic Basket usd/day 4,424 4,862 -9.0% -62.5%

LR2 1 Year TC Period usd/day 14,250 14,250 +0.0% -5.0%

MR2 1 Year TC Period usd/day 14,500 14,500 +0.0% +11.5%

TD12 Cont-USG ( 5 5 k ) ws 97.2 99.7 -2.5% -8.8%

TD18 Baltic-UKC ( 4 0 K) ws 149.6 152.1 -1.6% +18.9%

BSea-Med ( 3 0 k ) ws 140.0 140.0 +0.0% +16.7%

Med-Med ( 3 0 k ) ws 130.0 130.0 +0.0% +18.2%

Cle

anD

irty

Rates


Northbound days 1.5 1.5 +0.0% +0.0%

Southbound days 1.5 1.5 +0.0% +0.0%

600

700

800

900

1,000

13/7/17 13/11/17 13/3/18 13/7/18

Shanghai Container Freight Index

5,000

7,000

9,000

11,000

13,000

12/7/17 12/11/17 12/3/18 12/7/18

Geared - 1 YR TC Period (usd/day)

2500 1700 1100

6,000

8,000

10,000

12,000

14,000

12/7/17 12/11/17 12/3/18 12/7/18

Gearless - 1 YR TC Period (usd/day)

4250 3500 2700


ConTex index 529 534 -0.9% +38.8%

4250 teu (1Y, g’less) usd/day 13,030 13,139 -0.8% +77.9%



2500 teu (1Y, geared) usd/day 12,071 12,139 -0.6% +40.9%



The major liner companies have gone into summer holiday mode, in fact, the chartering market is quiet as would be expected at this time of year. Asia to West Coast North America (ECNA) container trade slowed after a brisk start to the year and won’t repeat the early-year pace now that the US and China trade war is in force, according to container shipping analyst Drewry. The demolition of container ships could hit a seven-year low this year if current trends continue.

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 826 817 +1.0% -4.2%

Services:

Shanghai - North Europe usd/teu 882 881 +0.1% -6.1%

Shanghai - Mediterranean usd/teu 887 903 -1.8% +2.7%

Shanghai - WC USA usd/feu 1,685 1,555 +8.4% +33.2%

Shanghai - EC USA usd/feu 2,710 2,623 +3.3% +20.4%

Shanghai - Dubai usd/teu 434 470 -7.7% -43.8%

Shanghai - Santos usd/teu 1,587 1,737 -8.6% -57.8%

Shanghai - Singapore usd/teu 140 152 -7.9% -23.9%


Recent Fixtures

Vessel Name Built TEUs TEU@14 Gear Fixture Period Rates

Conti Makalu 2004 8,189 6,310 no fixed to CMA CGM 70-100 days $15,900/d

Maine Trader 2004 4,992 3,280 no fixed to Hapag 4-6 weeks $13,500/d

Patraikos 2010 4,398 2,810 no extended to Ts Lines 6 weeks $12,650/d

Uni Florida 2007 3,451 2,340 no fixed to Maersk 3-6 m $11,500/d

As Petra 2004 2,556 1,768 yes fixed to Maersk 8-9 m $12,350/d

Julius S. 2004 2,474 1,886 yes fixed to Melfi 8-12 m $12,500/d

100

105

110

115

120

13/7/17 13/11/17 13/3/18 13/7/18

Yen/USD Exchange

1.00

1.10

1.20

1.30

13/7/17 13/11/17 13/3/18 13/7/18

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 2.86 2.87 2.87 2.90 2.93 2.93

Euro -0.01 0.27 0.53 0.89 1.25 1.41

Libor USD Libor Euro Euribor Euro

6 Months 2.52 -0.31 -0.27

12 Months 2.79 -0.23 -0.18

banchero costa

In the dry bulk segment, Mitsui & Co has exercised an option for a Kamsarmax at Jiangsu New YZJ (TIER II) at USD 27 mln with delivery starting from 2019 to the first half of 2020.

In the gas sector, Turkish Petroleum Corporation has signed a LNG carrier with around 170,000 cum at Hyundai with delivery during the second half of 2020. In addition, George Economou Group has contracted a LNG carrier with around 174,000 cum at Samsung with delivery due during the second half of 2021.

In the container segment, Eastern Pacific Shipping has exercised options for container units with capacity of around 15,000 TEUs (included a high reefer capacity) at USD 100 mln each.

Newbuilding Market

Newbuilding Reported Orders

Indicative Newbuilding Prices (China)

sale & purchase

Interest Rates

Interest Rate Swaps

9

Unit 01-Jul-18 M-o-M Y-o-Y

Capesize usd mln 47.1 +0.6% +11.3%

Ultramax usd mln 25.8 +0.3% +13.6%

Supramax usd mln 22.8 +0.4% +14.6%

VLCC usd mln 82.0 +1.1% +8.2%

LR2 Coated usd mln 45.3 +0.8% +10.5%

MR2 Coated usd mln 33.6 +0.4% +5.3%

13-Jul 06-Jul W-o-W Y-o-Y

USD/Euro 1.16 1.17 -0.7% +2.0%

Yen/USD 112.4 110.5 +1.7% -0.8%

SK Won/USD 1,123 1,116 +0.7% -1.1%

Exchange Rates


Type Size Built Yard Buyers Price Comment

Crude 154,000 2019/20 Samsung Teekay 125.0 2 Units, DP2 Shuttle

tnk, 1A IC, LNG ready

OBO 83,500 2020 Yangzijiang Klaveness 40.0 Est. price

Gas 173,400 2020 DSME Seatankers n.a. LNG Carrier

TYPE VESSEL NAME DWT BLT YARD BUYERS PRICE NOTE

Bulk Hanton Trader VI 81,073 2016 Jiangsu New

Hantong Undisclosed 24.3

Bulk Hanton Trader VI 81,073 2015 Jiangsu New

Hantong Undisclosed 24.2

Bulk Poseidon 75,000 2002 Hyundai Ulsan Undisclosed 9.5

Bulk Bao Tong 64,000 2014 Chengxi Undisclosed 21.3

Bulk Sbi Echo 61,528 2015 Imabari Undisclosed 19.0 incl. 5yrs bbb at

$5,400/d and repurchase opt.

Bulk Navios Armonia 55,522 2008 Kawasaki Greek buyers 14.2

Bulk Thor Enterprise 42,529 1995 Namura Undisclosed 5.6

Bulk UBC Bremen 24,072 1998 Saiki Far Eastern buyers N/A

Crude Resale H2229/30 318,000 2018 Samsung C. Of Aissot 88.0 Scrubber ready

Prod Andreas 35,000 1999 Daedong Indian buyers 5.8

300

350

400

450

500

16/7/17 16/11/17 16/3/18 16/7/18

SubCon Demo Assessment (usd/ldt)

Dirty Tnk Clean Tnk Dry Bulk

15

20

25

30

35

16/7/17 16/11/17 16/3/18 16/7/18

Secondhand Values (usd mln)

Panamax Aframax MR


Dry Bulk usd/ldt 429.5 433.0 -0.8% +25.8%

Dirty Tanker usd/ldt 437.0 440.0 -0.7% +21.4%

Clean Tanker usd/ldt 436.0 441.0 -1.1% +21.8%

sale & purchase banchero costa

Secondhand Market

Baltic Secondhand Assessments

Baltic Demolition Assessment (Subcontinent)

10


Capesize usd mln 35.5 35.3 +0.5% +13.0%

Panamax usd mln 21.9 21.9 -0.1% +14.0%

Supramax usd mln 18.4 18.4 -0.2% +15.1%

VLCC usd mln 61.6 61.7 -0.1% -0.5%

Aframax usd mln 29.9 29.8 +0.2% +0.8%

MR Product usd mln 26.0 25.9 +0.3% +7.9%


Sale and purchase activity showed initial signs of slow steaming going into the summer period. What is interesting to notice is the new type of requirement coming from Chinese buyers for import purpose, now focused more on modern tonnage, whilst before the ideal type of ship were early 2000’s built. So far, a new requirement for modern Supramaxes built after 2011 has been reported, mainly in order to match the new Tier II requirement. In terms of concluded business clients of Nisshin are reported having sold 2 x 81,000 dwt Kamsarmaxes built 2015 and 2016 at Jiangsu New Hantong for price of USD 48.5 mln en bloc, “HANTON TRADER V” and “HANTON TRADER VI”, whilst another major Japanese Owners, Doun Kisen, has committed the “NAVIOS ARMONIA”, about 55,500 dwt built 2008 Kawasaki, at USD 14.2 mln to Greek Buyers. A modern Chinese controlled Ultramax, “BAO TONG” about 64,000 dwt built 2014 Chengxi, was reported sold at USD 21.3 mln to European (apparently non Greeks) counterpart. Scorpio concluded another sale and lease back deal with Japanese counterpart for their “SBI ECHO”, around 61,000 dwt built 2015 Imabari, for a soft price of USD 19 mln against a 5 year BB back at $5,400/d (we understand there are re-purchase options after the third year). On the tanker front very quiet week with headline of the activity the notice of an Iraqi Buyer (JV between Iraqi Oil Tankers and Arab Maritime Petroleum Transport) tiding up 2 x VLCC resales scrubber fitted for delivery ex Samsung 4Q 2018 at price of region USD 88 mln each.

Secondhand Reported Sales

news banchero costa

China's iron ore imports fall on pollution curbs, higher stockpiles China's iron ore imports dropped 11.6 percent in June from the previous month, customs data showed, hit as Beijing intensifies its push to clean up the country's environment and by mounting stockpiles at ports. Arrivals into the world's top importer of the steelmaking material reached 83.24 million tonnes last month, according to the General Administration of Customs, down from May's 94.14 million tonnes and from 94.7 million tonnes in June last year. China June aluminium, steel exports rise as trade row intensifies China's aluminium exports exceeded half a million tonnes for only the second time ever in June while steel exports hit an 11-month high, as strong international prices and a weak yuan meant shipments continued to defy U.S. tariffs. China is the world's top producer of steel and aluminium, which have been subject to 25 percent and 10 percent import tariffs, respectively, in the United States, since March 23. China's top steelmaking city set to deepen output curbs over summer The top Chinese steelmaking city of Tangshan has ordered steel mills, coke producers and utilities to cut output further this summer, according to a document from the city government, the latest step to curb smog in one of the country's most polluted areas. The move to deepen cuts in emissions will last for six weeks from July 20 until Aug. 31, according to the document, which was reviewed by Reuters. That will be in addition to 10-15 percent capacity cuts imposed from March to November. India's Essar Vizag starts up newly expanded iron ore handling complex India's Essar Vizag Terminal said Thursday that it has started operating its expanded 24 million mt/year mechanized iron ore handling complex at Vizag Port in Andhra Pradesh. The complex is an all-weather, deep draft facility equipped to serve customers in Southeast Asia, China, Japan and South Korea. "The project will help exporters on the east coast benefit from shorter turnaround times and reduced freight costs," Essar Ports' managing director Rajiv Agarwal said. Essar Ports operates the port. China cuts soybean import forecast in face of trade war China on Thursday cut its forecast for soybean imports for the 2018/19 crop year, warning that higher prices due to trade conflict with the United States would curb demand as farmers switch to alternative ingredients for their animal feed. Imports of soybeans in the crop year that starts on Oct. 1 will be 93.85 million tonnes, down 1.8 million tonnes, or 2 percent, from last month's estimate, the Ministry of Agriculture and Rural Affairs said in its monthly crop report. COFCO says China can replace U.S. soy imports with alternatives - state media China can increase soybean imports from other countries to reduce reliance on buying from the United States, the president of state grains trader COFCO said in an interview with the Communist Party's official People's Daily paper. Yu Xubo said in the interview that China can increase soybean imports from South American countries amid an escalating trade dispute with the United States that has seen the world's two biggest economies impose new import tariffs on each other's goods. Global trade war to be a boon for Black Sea grain Trade conflict between the United States and China could further boost already booming grain and oilseed exports from the Black Sea region, traders and analysts said. New opportunities to sell wheat, corn and soybeans to China and even the European Union are set to open up for the region's main exporters Russia, Ukraine and Kazakhstan, whose recent ascendancy has already ended full U.S. dominance in markets such as Nigeria and Mexico. Drought-hit Argentine corn crop may keep shrinking, strain global supplies The estimate for Argentina's drought-hit corn crop may be cut further from the 32 million tonnes currently expected to be harvested this season, the Buenos Aires Grains Exchange and the country's main farmers group said on Thursday. A reduced Argentine crop would squeeze global supplies of the feed grain to levels not seen in at least four years. The U.S. Department of Agriculture on Thursday lowered its global end-of-season corn stocks projection for this season to the lowest since 2014, while its 2019 ending stocks outlook was cut to a six year low. Philippines 2018 nickel ore exports seen down on low prices -industry The Philippines' nickel ore exports may drop to 30-35 million tonnes this year from 36 million tonnes in 2017 amid weaker prices, the head of a nickel mining industry group said on Tuesday. "As a whole, we expect exports this year to be less than what we saw last year because the price of low-grade nickel now is weak," said, Dante Bravo, president of the Philippine Nickel Industry Association, speaking at a media forum. Source: Thomson Reuters/ Platts

Dry Bulk Commodities


news banchero costa

Oil & Gas

JP Morgan raises oil price outlook, but trims demand-growth forecast Investment bank JP Morgan on Friday raised its outlook for oil prices, but lowered its forecast for global crude demand-growth this year amid increasing uncertainty over international trade. The U.S. bank said prices for Brent crude, the international benchmark for oil markets, would average $70 per barrel in both 2018 and 2019, up from an earlier forecast of $65 and $60 per barrel respectively. Brent stood at around $74 on Friday. Barclays raises oil price view on tighter supply outlook British bank Barclays on Tuesday raised its outlook for oil prices for this year and next amid expectations of lower supply from Libya and Iran. "Due to new outages and a quicker Iran supply reduction, we see Brent and WTI prices averaging $71 per barrel and $65 per barrel next year," the bank said. Norway oil, gas union widens six-day drilling rig strike A Norwegian union for workers on offshore oil and gas drilling rigs stepped up a six-day strike on Monday that has slightly hit oil output after employers did not respond to demands for higher wages and pension benefits. The union is adding 900 workers to the strike, under a plan announced last week, after failing to win concessions before a midnight (2200 GMT) deadline since almost 700 workers on the rigs went on strike on Tuesday. China's June crude imports at 6-mth low as "teapot" buying slows; gas imports strong China's crude oil imports fell for a second month in a row in June to the lowest since December, as shrinking margins and volatile oil prices led some independent refiners, known as "teapots", to scale back purchases. June shipments came in at 34.35 million tonnes, or 8.36 million barrels per day (bpd), according to data from the General Administration of Customs. S.Korea's June crude oil imports drop lowest since Jan 2015 South Korea's imports of Iranian oil fell 40.3 percent in June from the same month a year ago to their lowest since January 2015, as the country's buyers' slashed purchases ahead of the reimposition of U.S. sanctions targeting Iran. South Korea, one of Asia's major Iranian oil customers, imported 686,849 tonnes of Iranian crude in June, or 167,820 barrels per day (bpd), compared with 1.15 million tonnes in June 2017, customs office data showed on Sunday. That was down 9.5 percent from May. U.S. oil exports to India soar ahead of sanctions on Iran U.S. crude oil exports to India hit a record in June and so far this year are almost double last year's total as the Asian nation's refiners move to replace supplies from Iran and Venezuela in a win for the Trump administration. U.S. President Donald Trump's administration has been pressuring its allies to cut imports of Iranian goods to zero by November and India's shift advances the U.S. administration efforts to use energy to further its political goals. PDVSA's oil sales to U.S. bounced in June; Caribbean stocks drained Venezuelan crude sales to the United States recovered in June from May as state-run PDVSA exported more of its diluted oil to its customers and drained inventories from two Caribbean islands affected by assets seizures, according to Thomson Reuters data. PDVSA exports have declined in recent months due to a stubborn tanker backlog around Venezuela's main ports and its fast-declining crude output, which has stopped the firm from complying with supply contracts to almost all of its customers. Saudi refinery exports first gasoline barrels to U.S. A refinery in Saudi Arabia has shipped its RBOB gasoline to the United States for the first time, a potential precursor for more deliveries to a region where prices are currently at seasonal three-year highs. The 400,000 barrels-per-day Jubail Satorp refinery, a joint venture between Saudi Aramco and French company Total, said in its verified Twitter account that it sent the shipment of reformulated blendstock gasoline - commonly called RBOB - to the United States. It did not say whether those barrels had arrived yet, and its exact destination was unclear. U.S. crude stocks slump nearly 13 mln bbls to Feb 2015 low - EIA U.S. crude oil stocks fell by nearly 13 million barrels last week, the most in nearly two years, dropping overall crude stocks to their lowest point since February 2015, the Energy Information Administration said on Wednesday. Crude inventories fell by 12.6 million barrels in the week to July 6, compared with analysts' expectations for a decrease of 4.5 million barrels. That dropped overall crude inventories, not including the U.S. strategic reserve, to 405.2 million barrels. Source: Thomson Reuters/ Platts

market report - week 28/2018 12

300

400

500

600

13/7/17 13/11/17 13/3/18 13/7/18

Wheat and Corn Prices (usd/t)

Corn Wheat

3,000

3,500

4,000

4,500

5,000

13/7/17 13/11/17 13/3/18 13/7/18

Steel Prices in China (rmb/t)

Rebar Plate

40

60

80

100

120

13/7/17 13/11/17 13/3/18 13/7/18

Iron Ore and Coal Prices (usd/t)

Steam Coal Iron Ore

40

50

60

70

80

90

13/7/17 13/11/17 13/3/18 13/7/18

Brent and WTI Oil Prices (usd/bbl)

Brent WTI

200

400

600

800

13/7/17 13/11/17 13/3/18 13/7/18

Bunker Prices @ Singapore (usd/t)

IFO 380 IFO 180 MGO


Wheat usd/t 493.8 512.8 -3.7% -3.7%

Corn usd/t 339.5 347.5 -2.3% -9.9%

Soybeans usd/t 819.8 867.5 -5.5% -17.2%

Palm Oil usd/t 532.9 561.2 -5.1% -11.0%


Iron Ore (Platts) usd/t 63.2 63.0 +0.4% -3.2%

Iron Ore China @Tangshan rmb/t 472.0 473.0 -0.2% -7.5%

Rebar in China rmb/t 4,120 4,040 +2.0% +6.4%

Plate in China rmb/t 4,250 4,218 +0.8% +9.3%

HR Coil in China rmb/t 4,354 4,352 +0.0% +13.3%

CR Sheet in China rmb/t 4,685 4,693 -0.2% +10.4%


Steam @ Richards Bay usd/t 107.4 107.6 -0.1% +35.9%

Steam @ Newcastle usd/t 117.7 116.1 +1.4% +40.2%

Coking Coal Australia usd/t 187.3 188.5 -0.7% +14.9%


Crude Oil Brent usd/bbl 74.8 77.4 -3.3% +52.8%

Crude Oil WTI usd/bbl 70.6 73.8 -4.3% +51.5%

Crude Oil Dubai usd/bbl 71.6 74.3 -3.5% +52.4%

Natural Gas Henry Hub usd/mmbtu 2.77 2.85 -2.8% -7.0%

Gasoline Nymex usd/gal 2.10 2.12 -0.9% +34.6%

ICE Gasoil usd/t 650.8 668.3 -2.6% +44.5%

Naphtha Tokyo usd/t 657.3 659.9 -0.4% +57.0%

Jet-Kerosene Asia usd/bbl 87.7 88.8 -1.2% +48.7%


Rotterdam usd/t 432.0 442.5 -2.4% +51.8%

Gibraltar usd/t 456.0 464.0 -1.7% +51.7%

Singapore usd/t 462.5 470.5 -1.7% +54.4%

Rotterdam usd/t 467.0 470.0 -0.6% +45.5%

Gibraltar usd/t 481.0 489.5 -1.7% +54.2%

Singapore usd/t 495.0 493.5 +0.3% +52.5%

Rotterdam usd/t 631.0 644.5 -2.1% +47.4%

Gibraltar usd/t 675.5 693.0 -2.5% +42.1%

Singapore usd/t 656.0 672.0 -2.4% +45.3%

IFO

38

0IF

O 1

80

MG

O

banchero costa commodities

Oil & Gas Prices

Coal Prices

Iron Ore and Steel Prices

Agricultural

Bunker Prices


head office: via pammatone, 2 16121 genoa (italy)

phone: + 39-010-[5631-1]

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Documents

BANCOSTA Weekly Market Report · grain exporters association ANEC, Brazil may also import up to 1 million tonnes of U.S. soybeans , with ... P1 Transatlantic r/v usd/day 13,300 10,222