BANCOSTA Weekly Market Report · Weekly Market Report ... year-on-year in 1Q 2018, although output has since recovered to show a drop of just 0.6% in 1H 2018. However, despite overcapacity

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Weekly Market Report

Week 30/2018 (23 July – 27 July)

Comment: Cement trade highlights

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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 30/2018

The global cement production was estimated to reach around 4.8 billion tonnes in 2017 according to the IMARC Group. However, of this production, only an estimated 3% are traded internationally by water, with another 2-3% traded domestically by sea or via inland waterways, excluding China.

China

While Chinese cement production came in at 2.3 billion tonnes in 2017, the country’s capacity is estimated at up to 3.5 billion tonnes, indicating a surplus capacity of at least 30%. The cement industry was thus included in supply side reforms, with production cuts enforced from Nov 2017 – Mar 2018. As a result, China’s cement production fell 4.5% year-on-year in 1Q 2018, although output has since recovered to show a drop of just 0.6% in 1H 2018.

However, despite overcapacity in the industry, most of the cement and clinker produced in China is traded domestically or regionally, with Chinese customs data showing only 12.9 million tonnes exported in 2017. With demand from property, infrastructure, and urbanization still seeing growth, China’s cement consumption is expected to increase around 2% in 2018, which may serve to increase domestic trading but limit the country’s cement exports this year. In the first 6 months of 2018, only 5.5 million tonnes of cement and clinker were exported, down 41.7% year-on-year.

U.S.

Despite having the third largest cement production capacity in the world, cement imports by the U.S. are still expected to rise from a relatively strong economy and job market, tax reforms, and an anticipated increase in infrastructure spending. In April 2018, the Portland Cement Association (PCA) predicted growth of 2.8% in cement consumption in 2018 and 2019, and expect this to climb to 4% in 2020 as impacts from potential federal infrastructure spending take effect. The difficulty of building new cement production capacity and the country’s long coasts and extensive waterways also help to support growing import volumes, with imports in 2018 expected to go above 12 million tonnes compared to 9.2 million tonnes in 2016.

Vietnam

Vietnam has been seeing strong cement production growth, with production in the country increasing from 60 million tonnes in 2012 to 78 million tonnes in 2017. However, domestic demand growth has not been keeping at the same pace, with the Vietnam Cement Association (VNCA) forecasting a glut of 25-36 million tonnes per annum (MTPA) of cement by 2020 as production completely outstrips national demand.

As a result, Vietnamese exports have been growing to Asian countries such as Bangladesh, China, and the Philippines. These countries are estimated to account for 31%, 29%, and 19% of Vietnam’s cement and clinker exports at present. Growing shipments have also been reported to Latin American countries like Chile and Peru, and African countries such as Mozambique and Kenya.

According to Global Cement, Vietnam’s cement exports in the first 7 months of 2018 are estimated at 17.8 million tonnes, an increase of 55% year-on-year and close to their 18-19 million tonnes target for the entire year. Exports of cement in July 2018 alone were estimated at 2.1 mln tonnes, an increase of 43% year-on-year.

Cement Trade Highlights

International50%

Domestic42%

Domestic (inland water)

8%

Global Cement & Clinker Trade by Water(source: Cement Distribution Consultants ; in % of global water trade volume)

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

06/2015 12/2015 06/2016 12/2016 06/2017 12/2017 06/2018

mill

ion

to

nn

es

Cement & Clinker Exports by China & Vietnam - last 36 months(source: customs data ; exports in million tonnes)

China Vietnam

Unit 27-Jul 20-Jul W-o-W Y-o-Y

BCI TC Avg. usd/day 23,824 24,446 -2.5% +164.7%

C8 Transatlantic r/v usd/day 24,950 29,075 -14.2% +293.5%

C14 China-Brazil r/v usd/day 22,673 21,682 +4.6% +113.5%

C10 Pacific r/v usd/day 22,542 21,508 +4.8% +133.6%

1 Year TC Period usd/day 21,000 21,000 +0.0% +64.7%

dry cargo chartering banchero costa

Capesize market showed a mixed trend softening suddenly in the end of the week but maintaining its positive feelings for the next days with rates expected to rise again.

In the Pacific basin all miners were in the market and up to usd 10.0 pmt was fixed for dates in the first half of August before going down to usd 9.3 pmt. The standard route from Saldanha Bay to Quingdao was traded in the very high usd 16's pmt for mid August dates.

Out of Brazil Vale took several vessels at usd 22.5 pmt for the first 10 days of August and trades from Tubarao to the Med was fixed in the mid usd 10's pmt.

In the Atlantic Ocean the market was basically stable with mid usd 20,000’s per day agreed for short T/A and the key C7 route has agreed at a stronger usd 11.85 pmt for mid August.

Some activity for short period with usd 24,000/d agreed for 4/6 months delivery prompt China.

Capesize Market

Rates

Panamax Market

Rates

The week started with the ECSAm market that was very active. The week continued with the Continent on fire, again, both for short rounds, fronthaul and that ECSAm remained very active. Pacific was showing mixed signals with demand improving, but the tonnage list remained very long.

By mid-week Atlantic rates were steady except for Baltic/Murmansk, with charterers seemingly more relaxed as tonnage availability for later dates improved. Pacific appeared to be reaching a standoff with charterers waiting and owners trying to maintain rates waiting for growing demand, larger Post-Panamax units seemed under a little more pressure. The week ended with a firm Atlantic market on early positions for both round voyages and fronthaul.

The Pacific remained more subdued, with anticipation of possible congestions being a factor for some charterers.

3

0

7,000

14,000

21,000

28,000

35,000

27/7/17 27/11/17 27/3/18 27/7/18

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

27/7/17 27/11/17 27/3/18 27/7/18

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

1-YR TC BPI TC

market report - week 30/2018


BPI TC Avg. usd/day 12,695 12,457 +1.9% +38.4%

BPI 82 TC Avg. usd/day 13,718 13,502 +1.6% n.a.

P1 Transatlantic r/v usd/day 15,211 14,328 +6.2% +52.6%

P2 Skaw-Gib Trip East usd/day 21,193 20,839 +1.7% +36.9%

P3 Pacific r/v usd/day 9,344 9,622 -2.9% +14.8%

1 Yr TC Period Panamax usd/day 12,000 12,500 -4.0% +37.1%

1 Yr TC Period Kamsarmax usd/day 13,500 14,000 -3.6% +38.5%

dry cargo chartering banchero costa

A very quiet week registered from US with little demand for first half August dates. The only deal officially reported was an Ultramax fixed at $17,000/d with grains to Med, the coal trade from USEC to Med was lacking completely and a couple of units open USEC had to ballast USG to find some suitable business. Rates for USG/Turkey with petcoke were down to $19.75/20/mt and some $0.5/mt less from NCSAm. The Handysize market was even worse with a couple of ship sitting spot in USG/USEC for a few days. ECSAm market registered daily ups and downs and in the end remained stable with a slightly softer trend. Supramax were getting around $14,500/d basis dely aps ECSAm for trips to Med and $14,000/d to Cont; Ultramax were around $1,000/d higher. Trips to Far East were a tick lower than the previous week around $14,250/d +425,000 bb on Supramax and $15,250/d + 525,000 bb on Ultramax. The Handysize market soften a little with 35,000 dwt fixed in the $12,500/13,000/d for trips to Cont and Med and around $16,000/d to F East.

Supramax & Handysize Market

N E

uro

pe

Me

dit

err

anea

n

Ind

ia

S A

fric

a

Fronthaul spot rates from N Europe carried on with almost no changes and Tess58 remained around $18,500/d for trips to F East and Ultramax getting some $1000/d more. Rates for backhaul trades to USG and ECSAm registered a minor increase around +$2/300 daily. The trend was different for the spot voyages to Med where rates fell by $500/d and might register further losses. A Tees58 is now worth around $12,500/d for the usual scrap run to E Med; this is likely connected to the ongoing firm market in BSea. Handysize, 35,000 dwt, experienced a downward trend with fronthaul trips hardly getting $15,000/d and a fancy 38,000 dwt with scrap from ARA/Ghent range to E Med fixing at $10,500/d. Backhaul rates to ECSAm and USG remained around $7,500/8,000/d. As said The market moved upwards in Med/BSea area with a large number of owners that tried to take advantage fixing long fronthauls. Ultramaxes were easily getting rates up to $20/21,000/d while Handies were fixed in the $14,000/d for trips to Far East. Also InterMed and trips to Cont increased with charterers bidding at $10/11,000/d from Canakkale for trips to Cont on Supramax and similar numbers registered for backhauls to USG and ECSAm. The general feeling is that the market can still improve and many owners took a wait and see approach.

The market kept dragging on with at unchanged rates. The area is very crowded of spot tonnage and demand is not large enough, however owners occasionally managed to to scratch smaller improvements. Coal from Indonesia to China showed a 56,000 dwt Dolphin type fixed at $10,500/d from Singapore and a Tess58 fixed at $11,500/d on very similar terms. Nickel ore from Philippines to China was fixed on an Ultramax at $10,500/d basis dely N China and on a Tess58 at $11,500/d with a closer delivery Taiwan. No activity was registered on Pacific RV. InterAsia trading showed a Dolphin type fixed for loading coal in Indonesia at $9,000/d basis dely S China and redely Thailand and a Tess58 with the same loading fixed at $11,000/d basis dely Jakarta and redely S China. The Handysize market remained even steadier with rates ranging within the $8/9,000/d depending on the trade and on vessel’s actual specs; a fancy 38,800 dwt with dely Spore was fixed at $9,250/d for a trip with salt via SE Asia to China.

Far

East

P

acif

ic

Rates kept increasing for most of the week, but on Friday the growth seemed to be slowing. Early in the week an Ultramax was fixed basis dely dop WC India at low/mid $13,000/d for a trip via UAE to India, then a 55,000 dwt was fixed from South of Mumbai delivery under $11,000/d for trip via MEG to EC India. A 56,000 dwt was fixed basis dely aps UAE at $13,000/d for a trip via MEG to WC India. From WC India a Supra was fixed at $11,500/d basis dely dop for trip to China. More activity was registered from S Africa with for 1st half August laycan: a 57,000 dwt was understood to be fixed at $11,000/d basis dely dop Tuticorin for a coal cargo via S Africa to MEG/WC India, then a 56,000 dwt open in India was fixed basis dely aps at $12,500/d + 250,000 bb for a trip to SE Asia. Towards the end of the week an Ultramax got $12,500/d + 260,000 bb basis dely aps Richards Bay Coal Terminal to MEG/WC India.

US

Atl

anti

c

Sou

th A

mer

ica

4

0

4,000

8,000

12,000

16,000

27/7/17 27/11/17 27/3/18 27/7/18

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

1-YR TC BSI TC

0

3,000

6,000

9,000

12,000

27/7/17 27/11/17 27/3/18 27/7/18

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

1-YR TC BHSI TC



BSI TC Avg. usd/day 11,404 11,232 +1.5% +25.9%

S4A 58 USG-Skaw/Pass usd/day 17,013 16,700 +1.9% +44.2%

S9 58 WAF-ECSA-Med usd/day 9,329 9,336 -0.1% +5.8%

S1B 58 Canakkale-FEast usd/day 19,657 18,586 +5.8% +11.3%

S11 58 Pacific r/v usd/day 10,181 10,019 +1.6% +20.9%


BHSI TC Avg. usd/day 8,102 8,209 -1.3% +10.5%


Sup

ram

axH

and

y

Rates

Unit 27-Jul 20-Jul W-o-WPremium/

Discount

Jul (18) usd/day 23,810 23,660 +0.6% -0.1%

Aug (18) usd/day 23,100 22,140 +4.3% -3.0%

Sep (18) usd/day 24,220 23,090 +4.9% +1.7%

Q4 (18) usd/day 24,610 24,305 +1.3% +3.3%

Q1 (19) usd/day 14,000 14,170 -1.2% -41.2%

Q2 (19) usd/day 15,830 15,880 -0.3% -33.6%

Cal 19 usd/day 19,283 19,250 +0.2% -19.1%

Cal 20 usd/day 19,350 19,155 +1.0% -18.8%

Cal 21 usd/day 16,410 16,390 +0.1% -31.1%

Jul (18) usd/day 11,850 11,810 +0.3% -6.7%

Aug (18) usd/day 12,245 12,360 -0.9% -3.5%

Sep (18) usd/day 12,245 12,540 -2.4% -3.5%

Q4 (18) usd/day 12,300 12,550 -2.0% -3.1%

Q1 (19) usd/day 11,440 11,470 -0.3% -9.9%

Q2 (19) usd/day 12,605 12,700 -0.7% -0.7%

Cal 19 usd/day 12,354 12,360 -0.0% -2.7%

Cal 20 usd/day 11,760 11,790 -0.3% -7.4%

Cal 21 usd/day 10,065 10,095 -0.3% -20.7%

Jul (18) usd/day 11,010 11,100 -0.8% -3.5%

Aug (18) usd/day 11,965 11,930 +0.3% +4.9%

Sep (18) usd/day 12,205 12,320 -0.9% +7.0%

Q4 (18) usd/day 12,510 12,540 -0.2% +9.7%

Q1 (19) usd/day 11,110 11,140 -0.3% -2.6%

Q2 (19) usd/day 12,000 11,870 +1.1% +5.2%

Cal 19 usd/day 12,210 12,180 +0.2% +7.1%

Cal 20 usd/day 11,680 11,680 +0.0% +2.4%

Cal 21 usd/day 10,410 10,400 +0.1% -8.7%

Jul (18) usd/day 8,263 8,275 -0.1% +2.0%

Aug (18) usd/day 9,150 9,288 -1.5% +12.9%

Sep (18) usd/day 9,650 9,713 -0.6% +19.1%

Q4 (18) usd/day 9,825 9,888 -0.6% +21.3%

Q1 (19) usd/day 8,963 8,988 -0.3% +10.6%

Q2 (19) usd/day 9,500 9,500 +0.0% +17.3%

Cal 19 usd/day 9,475 9,475 +0.0% +16.9%

Cal 20 usd/day 9,263 9,250 +0.1% +14.3%

Cal 21 usd/day 9,175 9,175 +0.0% +13.2%

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 20.18 18.59 +8.6% -16.4%

TD1 MEG-USG usd/day -15,145 -15,696 +3.5% -202.4%

TD2 MEG-Spore ws 53.29 48.79 +9.2% +2.7%

TD3C MEG-China ws 52.42 48.19 +8.8% +3.1%

TD3C MEG-China usd/day 13,156 10,393 +26.6% -8.2%

TD15 WAF-China ws 51.63 47.33 +9.1% +0.3%

Avg. VLCC TCE usd/day -995 -2,652 +62.5% -115.2%

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

TD6 BSea-Med ws 91.31 84.72 +7.8% +21.7%

TD6 BSea-Med usd/day 12,907 9,858 +30.9% +94.7%

TD20 WAF-Cont ws 70.68 71.02 -0.5% +7.7%

MEG-EAST ws 65.00 66.00 -1.5% -7.1%

MEG-WEST ws 27.00 28.00 -3.6% +8.0%

Avg. Suezmax TCE usd/day 10,090 9,077 +11.2% +39.9%


TD7 NSea-Cont ws 124.72 116.39 +7.2% +28.7%

TD7 NSea-Cont usd/day 16,448 12,285 +33.9% +253.4%

TD17 Baltic-UKC ws 110.00 91.67 +20.0% +76.0%

TD17 Baltic-UKC usd/day 23,570 14,438 +63.2% +1516.6%

TD19 Med-Med ws 118.33 118.33 +0.0% +38.8%

TD19 Med-Med usd/day 12,112 12,690 -5% +363.9%

TD8 Kuwait-China ws 103.11 101.72 +1.4% +13.7%

TD8 Kuwait-China usd/day 3,823 4,225 -9.5% -12.4%

TD9 Caribs-USG ws 87.78 86.94 +1.0% -14.6%

TD9 Caribs-USG usd/day -2,164 -1,659 -30.4% -143.4%

Avg. Aframax TCE usd/day 10,169 8,215 +23.8% +156.5%


VLC

CSu

ezm

axA

fram

ax

tanker chartering banchero costa

The trend for VLCCs in the MEG started during previous week kept going in this one, and the healthy demand pushed rates up in the low ws50s region for East discharge and around ws20 for Western destinations. Market has been pretty dynamic also off West Africa where owners managed to push rates for East discharge up to the low ws50s level. Constant demand paired with a shortening position list led to firming rates in the Caribs where voyages for Singapore discharge reached USD 3.6 mln. A slow start of the week for Suezmaxes in West Africa but, as demand stabilizes, rates for UKC discharge settled around ws70. Same happened in the Med but a busier second half of the week allowed some rates improvements with the Black Sea/Med closing around ws90. Aframax market in the Mediterranean failed to keep the momentum going, and getting closer to the weekend, rates started showing some weakness settling around ws115. Rather active week in the North Sea at least during the first half, allowing owners to push rates up to around ws125 for the Cross-Continent and ws110 off the Baltic. Looks like something is finally moving in owners' favour in the Caribs, a more balanced position list allowed rates to slowly firm up to ws87.

Crude Oil Tanker Market

6

Rates


0

8,000

16,000

24,000

32,000

27/7/17 27/11/17 27/3/18 27/7/18

VLCC MEG-Far East (usd/day)

-10,000

0

10,000

20,000

30,000

27/7/17 27/11/17 27/3/18 27/7/18

TD6 Suexmax BSea-Med (usd/day)

-10,000

0

10,000

20,000

30,000

27/7/17 27/11/17 27/3/18 27/7/18

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

27/7/17 27/11/17 27/3/18 27/7/18

MR Pacific Basket (usd/day)

0

5,000

10,000

15,000

20,000

25,000

27/7/17 27/11/17 27/3/18 27/7/18

MR Atlantic Basket (usd/day)

0

5,000

10,000

15,000

20,000

27/7/17 27/11/17 27/3/18 27/7/18

TC1 LR2 MEG-Japan (usd/day)

tanker chartering banchero costa

Product Tanker Market

Delays at Turkish Straits for Daylight Restricted Vessels

Market in the East of Suez experienced a flat week overall. LR2 owners had to accept ws100 for a MEG/Japan voyage basis 75,000 (equal to about $6,500/d TCE) and USD 1.95 mln for MEG/UKC voyages. LR1 segment suffered as well and shifted to ws115 (equal to about $6,500/d TCE) for eastward voyages basis 55,000 tons. The West of Suez market slightly improved, allowing LR1 and LR2 to fix respectively at USD 1.5 mln and USD 1.85 mln for a UKC/Japan voyage. Another quiet week recorded in the Med for Clean Handies, both in terms of activity and rates levels. Cross-Med trades kept ws125 level on 30,000 tonnes and B Sea loadings the usual premium of 20 ws points. In the Cont, Handy market maintained ws135 basis 30,000 on the Baltic/UKC trades and ws125 for the Cross-Cont, albeit ws125 was fixed ex Finnart. Plenty of cargo from the UKC for clean MRs led rates of 37,000 mt Cont/TA voyages from ws105 up to ws112.5 by mid-week, but didn't prevent rates to come back to ws107.5-110 level which reported by Friday. Down in the Med, loadings going TA were paying ws110 always on 37,000 mt. US market for MRs heading to Europe fell again up to ws 75 for 38,000 mt. The handy dirty product market in the Med was still in tension during the week. A very tight position list pushed the rates up to 30@195 for the B Sea/Med and 30@175 for the Cross-Med. We also may see rates going up further if activity continues at these levels as there are no too many ships in the area. UKC was busy as well and rates moved up to 30@165 for the Baltic/UKC with some owners preferring to look at the Cont/Med voyages, therefore the UKC market may have soon limited tonnage available for local business. The MRs fixed both Handy and MR stems in the UKC and Med therefore also on this segment the rates moved up to 45@130 for the BSea/Med, 45@120/125 for the Cross-Med and 45@120 for the Baltic/UKC. Some activity recorded also on Panamax with rates moving now at [email protected]/105 both for the Med/USG and UKC/USG.



TC1 MEG-Japan ( 7 5 k ) ws 101.1 104.4 -3.2% -12.5%

TC1 MEG-Japan ( 7 5 k ) usd/day 6,657 8,124 -18.1% -43.7%

TC8 MEG-UKC ( 6 5 k ) usd/mt 24.7 25.4 -2.6% +37.8%

TC5 MEG-Japan ( 5 5 k ) ws 112.9 116.7 -3.2% -2.3%

TC5 MEG-Japan ( 5 5 k ) usd/day 6,216 7,390 -15.9% -22.5%

TC2 Cont-USAC ( 3 7 k ) ws 108.6 104.4 +4.0% -9.3%

TC2 Cont-USAC ( 3 7 k ) usd/day 1,427 1,287 +10.9% -71.0%

TC14 USG-Cont ( 3 8 k ) ws 74.1 82.2 -9.9% -12.9%

TC14 USG-Cont ( 3 8 k ) usd/day -3,347 -1,633 -105.0% -813.6%

TC9 Baltic-UKC ( 2 2 k ) ws 135.0 132.5 +1.9% -3.3%

TC6 Med-Med ( 3 0 k ) ws 124.9 125.0 -0.1% +0.2%

TC7 Spore-ECAu ( 3 0 k ) ws 190.8 184.1 +3.7% -13.9%

TC7 Spore-ECAu ( 3 0 k ) usd/day 11,687 11,209 +4.3% -0.1%

TC11 SK-Spore ( 4 0 k ) usd/mt 9.19 9.16 +0.3% +13.5%

MR Pacific Basket usd/day 9,985 10,442 -4.4% +7.6%

MR Atlantic Basket usd/day 3,212 4,411 -27.2% -54.1%

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% +7.4%

TD12 Cont-USG ( 5 5 k ) ws 102.8 100.9 +1.9% -1.8%

TD18 Baltic-UKC ( 4 0 K) ws 160.8 155.8 +3.2% +40.9%

BSea-Med ( 3 0 k ) ws 175.0 150.0 +16.7% +11.1%

Med-Med ( 3 0 k ) ws 195.0 140.0 +39.3% +34.5%

Cle

anD

irty

Rates


Northbound days 1.5 1.5 +0.0% +0.0%

Southbound days 1.5 1.5 +0.0% +50.0%

600

700

800

900

1,000

27/7/17 27/11/17 27/3/18 27/7/18

Shanghai Container Freight Index

5,000

7,000

9,000

11,000

13,000

26/7/17 26/11/17 26/3/18 26/7/18

Geared - 1 YR TC Period (usd/day)

2500 1700 1100

6,000

8,000

10,000

12,000

14,000

26/7/17 26/11/17 26/3/18 26/7/18

Gearless - 1 YR TC Period (usd/day)

4250 3500 2700


ConTex index 518 522 -0.8% +36.3%

4250 teu (1Y, g’less) usd/day 12,722 12,839 -0.9% +78.1%



2500 teu (1Y, geared) usd/day 11,932 11,994 -0.5% +39.6%



The liner companies continue to struggle with rising fuel costs as east-west spot rates remain static. Box carrier introduced general rate increases in order to push up rates: attempts to raise rates on the Asia-Europe trade have no particular success, while transpacific carriers managed to get a 15 percent on rates to the US East Coast from Asia and a 30% to the US west coast. The latest Shanghai Containerised Freight Index further sideward movement for spot rates on the Asia- Europe trade, prolonging the stable trend of recent months.

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 864 794 +8.8% -6.7%

Services:

Shanghai - North Europe usd/teu 926 863 +7.3% -3.8%

Shanghai - Mediterranean usd/teu 893 869 +2.8% +1.1%

Shanghai - WC USA usd/feu 1,877 1,616 +16.2% +11.3%

Shanghai - EC USA usd/feu 2,846 2,650 +7.4% +6.0%

Shanghai - Dubai usd/teu 371 371 +0.0% -46.2%

Shanghai - Santos usd/teu 1,931 1,437 +34.4% -42.4%

Shanghai - Singapore usd/teu 146 131 +11.5% -18.4%


Recent Fixtures

Vessel Name Built TEUs TEU@14 Gear Fixture Period Rates

MP The Edelman 2005 5,060 3,386 no fixed to HMM 6-12 m $12,300/d

Navios Lapis 2009 4,250 2,800 no fixed to CMA CGM 3-6 m $12,500/d

Maribor 2005 4,043 2,881 no extended to Cosco 1-2 m $12,300/d

Atlantic Flosta 2002 2,474 1,890 yes fixed to Maersk Line 2-4 m $10,250/d

Marivia 2001 2,082 1,650 yes fixed to MCC 2-6 m $9,500/d

Sagittarius 2001 1,730 1,125 yes extended to HMM 6-8 m $9,850/d

100

105

110

115

120

27/7/17 27/11/17 27/3/18 27/7/18

Yen/USD Exchange

1.00

1.10

1.20

1.30

27/7/17 27/11/17 27/3/18 27/7/18

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 2.93 2.97 2.98 3.01 3.05 3.05

Euro 0.02 0.31 0.58 0.92 1.30 1.45

Libor USD Libor Euro Euribor Euro

6 Months 2.53 -0.32 -0.27

12 Months 2.82 -0.23 -0.18

banchero costa

The news of the past week was that Japanese shipyards have apparently closed down the line to Tier II engines which opens interesting perspectives for both Chinese and South Korean shipbuilders who are still able to offer this type of fittings. A good example of the consequences to the above may be the 2+2 optional 63,000 dwt ultramax bulk carriers being inked by Doun Kisen, Japan at Nantong Xiangyang Shipbuilding for delivery in the first half of 2020, TIER II of course. On the big size, this time TIER III, Sinokor Merchant Marine has ordered 2 x 208,000 dwt Newcastelemax at Shanghai Waigaoqiao with delivery 2020 at around USD 51/52 mln. Other sectors have seen important orders too, especially gas. US investment company Delos Shipping placed 6+6 93,000 cbm ethanol carriers at Hyundai and Samsung in equal share. They will be the biggest units ever built; price should be averaging to usd 115 mln apiece for a total possible investment up to usd 1.5 billion. The order is based on speculation but against long T/Charters to Chinese company Zhejiang Satellite Petrochemical (ZSP). NYK has confirmed their second very large LNG of 174,000 cbm at Hyundai Samho with delivery in April 2020 but price remains undisclosed.

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%

27-Jul 20-Jul W-o-W Y-o-Y

USD/Euro 1.16 1.17 -0.6% -0.6%

Yen/USD 111.1 111.4 -0.3% -0.2%

SK Won/USD 1,118 1,134 -1.4% +0.5%

Exchange Rates


Type Size Built Yard Buyers Price Comment

Dry 208,000 2020 SWS Sinokor 51.0 2 units, Tier 3

Dry 84,000 2020/21 Oshima Foremost n.a. 2 units

Product 115,000 2020 Daehan Sinokor 46.0 2 units + 2 Opt, Tier 2

TYPE VESSEL NAME DWT BLT YARD BUYERS PRICE NOTE

VLOO F Whale 319,800 2011 Hyundai Greek buyers 41.0 10 cargo tanks

Bulk Dubai Star 75,200 2001 Samho Chinese buyers 8.2

Bulk Alkyon 74,000 2001 Hitachi Chinese buyers 8.1

Bulk Tai Profit 73,100 2001 Sumitomo Chinese buyers 7.75

Bulk Bulk Neptune 57,000 2009 Mitsui Undisclosed 15.0

Bulk Jin Li 50,700 2001 Oshima Zhejiang Fuxing 8.6

Bulk Evangelia L 38,000 2015 Naikai Iraqi buyers 19.0 open hatch

Crude Nichion 304,000 2004 Universal C. Of Hellenic Tankers 23.5

Prod River Eternity 105,400 2006 Sumitomo C. Of Latsco 15.0 coated / uncoiled

Prod Sigma Eternity 105,200 2009 Hyundai HI C. Of Latsco 21.5

Prod Laima 37,300 2003 Hyundai Mipo Indonesian buyers 8.5 SS/DD due 2021

Prod Baltic Sea I 37,300 2003 Hyundai Mipo Middle Eastern buyers 6.1 SS/DD due, IC 1B

350

400

450

500

30/7/17 30/11/17 31/3/18

SubCon Demo Assessment (usd/ldt)

Dirty Tnk Clean Tnk Dry Bulk

15

20

25

30

35

30/7/17 30/11/17 31/3/18

Secondhand Values (usd mln)

Panamax Aframax MR


Dry Bulk usd/ldt 421.0 423.0 -0.5% +19.1%

Dirty Tanker usd/ldt 434.0 431.0 +0.7% +15.4%

Clean Tanker usd/ldt 432.0 431.0 +0.2% +16.1%

sale & purchase banchero costa

Secondhand Market

Baltic Secondhand Assessments

Baltic Demolition Assessment (Subcontinent)

10


Capesize usd mln 36.0 35.8 +0.7% +15.5%

Panamax usd mln 21.9 21.9 -0.1% +15.2%

Supramax usd mln 18.4 18.4 -0.1% +15.9%

VLCC usd mln 61.8 61.8 +0.0% -0.0%

Aframax usd mln 29.9 29.8 +0.2% +0.8%

MR Product usd mln 25.9 25.9 -0.0% +8.8%


Dry bulk market showed positive signs also thanks to strong Chinese imports that are supporting the market with a good activity on modern and large vessels. Following the recent purchase of four Capesizes, Sinokor are believed to be the Buyers of 3 Capesize resale dely late 2019 and Q1 2020. The ships are ex Jiangsu Yangzi Xinfu, reported price of region of usd 50 mln basis scrubber fitted. Following the new regulation applying for importing ships into the Chinese system, we see the number of enquiries for post 2011 built units growing, on the contrary we noticed some pressure on early-mid 2000 Supramax and Panamax such as the “LADY MARIA OCEAN” 76,000 dwt built 2007 Imabari which reported sold at price of region usd 13.2 mln, softer compared to recent similar tonnage. Older Panamaxes are also showing sign of softening; “DUBAI STAR” is reported sold to Chinese at usd 8.4 mln whilst the “TAI PROFIT” 73,000 dwt built 2001 Sumitomo at region of usd 7.75 mln. An interesting benchmark is the sale, still on subjects, of the Tess 58 “TSCHAIKOWSKY” around 58,000 dwt built 2008 Tsuneishi Cebu which committed at usd 14.2 mln (the sale is being done via online platform vessel's bid). On the tanker side, softening prices have encouraged some transactions to happen, again with focus on larger tonnage. The “NICHION” around 303,000 dwt built 2004 Universal controlled by Japanese JX Ocean is reported old to Greeks for usd 23.5 mln, buying mentioned being Hellenic Tankers and/or Cyprus. In the product sector the “SIGMA INTEGRITY” 105,000 dwt built 2009 Hyundai Ulsan has been reported sold for usd 21.5 mln to Latsco who is also mentioned as the potential buyer of the “RIVER ETERNITY” 105,000 dwt built 2006 Sumitomo at price of region usd 15 mln (the ship has no coils though).

Secondhand Reported Sales

news banchero costa

Global steel output jumps in H1 as strong margins tempt mills to ramp up Global crude steel output, a gauge of economic health, rose 4.6 percent in the first half of this year versus the same period last year, as strong margins prompted mills in major producing countries to ramp up, industry data showed on Thursday. Crude steel production for the 64 countries reporting to the World Steel Association (worldsteel) was 881.5 million tonnes in the first half. In June, it rose 5.8 percent versus June last year to 151.4 million tonnes, worldsteel said. Chinese steel output cuts to vary from mill to mill next winter -official Production cuts in China's mammoth steel sector will vary from mill to mill next autumn and winter, said an environmental ministry official, as the country shifts away from a 'one size fits all' approach to fighting pollution. That comes after the nation's state council earlier this month said the 82 cities required to take special anti-smog measures over autumn and winter would be able to draw up their own bespoke plans for those steps. China probes stainless steel imports from Indonesia, EU, Japan and Korea China launched an anti-dumping probe into stainless steel imports worth $1.3 billion, including from a privately owned Chinese mill with operations offshore, after complaints that a flood of product has damaged the local industry. The Commerce Ministry said the investigation will target imports of stainless steel billet and hot-rolled stainless steel sheet and plate from the European Union, Japan, South Korea and Indonesia, which nearly tripled last year. Australia's Fortescue Metals Group posts record quarterly iron ore shipments Iron ore producer Fortescue Metals Group reported record quarterly iron ore shipments on Thursday, enabling it to meet its full-year guidance. The world's no. 4 iron ore miner shipped 46.5 million tonnes in the June quarter compared with 44.7 million tonnes a year ago, the company said in a statement. UBS had expected shipments of 46.3 million tonnes for the period. Only a 'cataclysm' could hit top quality ore demand -Vale CEO Brazil's Vale, the world's top iron ore producer, forecast steady prices for the mineral and rising premiums for its top quality ore, thanks to strong demand from China and despite global trade tensions. Vale Chief Executive Officer Fabio Schvartsman said a scarcity of Vale's trademark top quality ore protects the miner for the foreseeable future from the impact of a global trade war, which has hurt other minerals. India coal imports surge in July, despite advancing prices: Russell India's coal imports appear to have surged in July and may even come close to a monthly record as it grapples with domestic transport woes and rising demand for electricity. Coal imports are on track to reach 19.7 million tonnes in July, according to vessel-tracking and port data compiled by Thomson Reuters Supply Chain and Commodity Forecasts. New Brazil freight policy will harm grains trade, boost costs -Cargill Food processor and commodities trader Cargill Inc said on Tuesday a new Brazilian road freight policy would have a major impact on grains trading, driving up costs in the world's biggest soy producer. Paulo Sousa, Cargill's head of grains and food processing in Latin America, said the new freight rules would hamper forward sales of grain and reduce transportation efficiency in Brazil. Trade war drives China to seek ways to cut soymeal in animal feed China's state planner has discussed ways of reducing soymeal levels in animal feed with top feed makers, sources briefed on the matter said, as Beijing tries to help its farmers cope with a protracted trade war with Washington. The National Development and Reform Commission (NDRC) called the companies to a meeting in the Chinese capital on Wednesday, the two sources said. The discussions also looked at how to secure alternative protein-rich ingredients, they added. Trump wants $12 billion in aid to U.S. farmers suffering from trade war The Trump administration on Tuesday said it will use a Great Depression-era program to pay up to $12 billion to help U.S. farmers weather a growing trade war with China, the European Union and others that the president began. It is a clear signal the U.S. President Donald Trump is determined to stick with tariffs as his weapon of choice in the conflict. Discount not discourse to boost U.S. soy sales to EU European Union imports of U.S. soybeans will remain strong for economic reasons with talks between U.S. President Donald Trump and European Commission President Jean-Claude Juncker giving them only a symbolic boost, European traders and analysts said. Trump told reporters after meeting Juncker on Wednesday that the EU would start, almost immediately, to buy a lot of soybeans.

Source: Thomson Reuters/ Platts

Dry Bulk Commodities


news banchero costa

Oil & Gas Russia raises oil output forecast for 2018, 2019 Russia's oil production this year will increase to 551 million tonnes (11.02 million barrels per day), a new 30-year high and up by around 3.5 million tonnes from previous expectations, Energy Minister Alexander Novak said on Wednesday. He said Russia would further raise production to 555 million tonnes in 2019 after the Organization of the Petroleum Exporting Countries and other oil producers led by Russia agreed last month to ease production curbs. In China's far west, CNPC vows $22 bln spend to replace ageing oil wells China National Petroleum Corp (CNPC) said on Wednesday it will spend more than 150 billion yuan ($22 billion) by 2020 to boost oil and gas production in the western region of Xinjiang, aiming to offset falling output from ageing fields in northeast China. The increased spending will push output in the Xinjiang Autonomous Region to more than 50 million tonnes of oil equivalent between 2018 and 2020, CNPC said. Iran says will respond in kind if US tries to block oil exports Iran will react with equal countermeasures if Washington tries to block its oil exports, the foreign ministry said, while the Islamic Republic's armed forces chief said U.S. threats would draw an "unimaginable and regrettable" reaction. U.S. officials are stepping up diplomatic efforts to pressure countries to stop importing Iranian oil. Iran becomes India's No. 2 oil supplier, ahead of Saudi- govt data Iran was the second-biggest oil supplier to Indian state refiners between April and June, India's oil minister said, replacing Saudi Arabia as companies took advantage of steeper discounts offered by Tehran. India, Iran's top oil client after China, shipped in 5.67 million tonnes, or about 457,000 barrels per day (bpd), of oil, from the country in the first three months of this fiscal year, Dharmendra Pradhan told lawmakers in a written reply. Taiwan's Formosa buys first U.S. crude to replace Mideast oil - official Taiwanese oil refiner Formosa Petrochemical Corp has bought a U.S. crude oil cargo for the first time to replace Middle East crude, the company spokesman said. The company bought 1 million barrels of U.S. Mars crude to be delivered between the second-half of September and the second-half of October as its price was competitive with those of Middle East oil, Formosa's spokesman KY Lin told Reuters. Saudi Arabia suspends oil exports through Red Sea lane after Houthi attack Top oil exporter Saudi Arabia said on Thursday it was "temporarily halting" all oil shipments through the strategic Red Sea shipping lane of Bab al-Mandeb after an attack on two big oil tankers by Yemen's Iran-aligned Houthi movement. Saudi Energy Minister Khalid al-Falih said in a statement sent by his ministry that the Houthis had attacked two Saudi Very Large Crude Carriers (VLCCs) in the Red Sea on Wednesday morning, one of which sustained minimal damage. Petrobras targets larger China market share with new crude oil Brazil's state-controlled energy company Petrobras plans to push more crude oil to top importer China by marketing a new medium-sweet grade that could be shipped from October, two sources with knowledge of the matter said. Petrobras expects to start pumping pre-salt oil from new platforms in the fourth quarter that would add to output from Latin America's biggest producer and lift its exports. U.S. refiners boost purchases of CPC Blend to record as prices drop U.S. refiners will import a record monthly volume of crude from the Caspian region in July after snapping up the cargoes when prices reached near six-year lows, according to market sources and Thomson Reuters shipping data. The unusually large volume of crude is one of many changes in the international oil trade caused by a flood of U.S. shale oil headed overseas. France's Avril raises biodiesel output on higher oil prices, demand Strong oil prices and a spike in demand has allowed Avril's biodiesel plants to run at full capacity since June but Argentine imports could force the European Union's largest biodiesel maker to return to part-time work, its CEO said on Tuesday. Europe's biodiesel industry has been struggling since the EU reduced duties on imports from Argentina last year after Buenos Aires mounted a successful challenge at the World Trade Organisation. U.S. crude inventories slump 6 mln bbls to Feb 2015 low -EIA U.S. crude oil inventories last week tumbled more than expected to their lowest level since 2015 as exports jumped and stocks at the Cushing hub dropped, the Energy Information Administration said on Wednesday. Crude inventories fell 6.1 million barrels in the week to July 20, compared with analysts' expectations for a decrease of 2.3 million barrels. At 404.9 million barrels, inventories, not including the nation's emergency petroleum reserve, were at their lowest level since February 2015. Source: Thomson Reuters/ Platts

market report - week 30/2018 12

300

400

500

600

27/7/17 27/11/17 27/3/18 27/7/18

Wheat and Corn Prices (usd/t)

Corn Wheat

3,000

3,500

4,000

4,500

5,000

27/7/17 27/11/17 27/3/18 27/7/18

Steel Prices in China (rmb/t)

Rebar Plate

40

60

80

100

120

27/7/17 27/11/17 27/3/18 27/7/18

Iron Ore and Coal Prices (usd/t)

Steam Coal Iron Ore

40

50

60

70

80

90

27/7/17 27/11/17 27/3/18 27/7/18

Brent and WTI Oil Prices (usd/bbl)

Brent WTI

200

400

600

800

27/7/17 27/11/17 27/3/18 27/7/18

Bunker Prices @ Singapore (usd/t)

IFO 380 IFO 180 MGO


Wheat usd/t 535.8 513.8 +4.3% +11.3%

Corn usd/t 364.5 355.8 +2.5% -2.9%

Soybeans usd/t 874.5 851.3 +2.7% -12.5%

Palm Oil usd/t 537.4 540.6 -0.6% -13.4%


Iron Ore (Platts) usd/t 64.1 63.6 +0.7% -7.9%

Iron Ore China @Tangshan rmb/t 499.0 487.0 +2.5% -3.7%

Rebar in China rmb/t 4,180 4,142 +0.9% +6.7%

Plate in China rmb/t 4,262 4,248 +0.3% +7.7%

HR Coil in China rmb/t 4,360 4,355 +0.1% +11.0%

CR Sheet in China rmb/t 4,689 4,692 -0.1% +7.4%


Steam @ Richards Bay usd/t 104.0 107.4 -3.1% +31.6%

Steam @ Newcastle usd/t 115.2 117.7 -2.1% +34.0%

Coking Coal Australia usd/t 182.2 183.4 -0.7% +10.4%


Crude Oil Brent usd/bbl 74.3 72.8 +2.0% +41.6%

Crude Oil WTI usd/bbl 68.9 68.1 +1.2% +38.5%

Crude Oil Dubai usd/bbl 73.8 71.5 +3.1% +48.0%

Natural Gas Henry Hub usd/mmbtu 2.79 2.74 +1.8% -5.1%

Gasoline Nymex usd/gal 2.16 2.06 +4.9% +28.6%

ICE Gasoil usd/t 660.3 642.8 +2.7% +33.2%

Naphtha Tokyo usd/t 656.5 648.8 +1.2% +54.1%

Jet-Kerosene Asia usd/bbl 87.4 86.9 +0.6% +46.2%


Rotterdam usd/t 440.0 421.0 +4.5% +46.4%

Gibraltar usd/t 462.5 447.0 +3.5% +46.1%

Singapore usd/t 473.5 460.5 +2.8% +52.3%

Rotterdam usd/t 472.5 458.0 +3.2% +41.5%

Gibraltar usd/t 490.0 473.0 +3.6% +46.5%

Singapore usd/t 508.0 493.0 +3.0% +54.2%

Rotterdam usd/t 626.0 614.0 +2.0% +37.9%

Gibraltar usd/t 691.5 675.0 +2.4% +40.7%

Singapore usd/t 656.5 642.5 +2.2% +38.4%

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]

dry - capesize 5631-200 [email protected] research 5631-535 [email protected]

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Documents

BANCOSTA Weekly Market Report · Weekly Market Report ... year-on-year in 1Q 2018, although output has since recovered to show a drop of just 0.6% in 1H 2018. However, despite overcapacity