DRY
Australia’s GrainCorp posts bumper profit but cloudy outlook hits shares
Australia’s biggest grain handler GrainCorp Ltd said on Tuesday its annual underlying profit nearly tripled on the back of a record wheat crop, but warned of a shrinking harvest and volatile energy costs ahead, sending its shares sharply lower. The negative reaction to GrainCorp’s best result in four years underscored its exposure to the effects of weather on crop volumes, with the company making efforts to diversify its business into related areas. (Reuters)
Brazil’s Vale denies postponing sale of New Caledonia mine stake
Brazil’s Vale SA in a securities exchange filing on Monday denied that it had decided to postpone the sale of a stake in the New Caledonia nickel mine, saying it is continuing to look for a partner. Reuters reported on Friday, citing sources, that the mining major would postpone the sale for up to a year after initial bids for the assets came in at the lower end of expectations. (Reuters)
Philippines 9-month nickel ore output drops 11 pct amid sanctions
Nickel ore output in the Philippines, the world’s top supplier, dropped 11 percent in the nine months to September with several mines still suspended under a government crackdown and others hit by bad weather, the mining industry regulator said. Of the country’s 30 nickel mines, only 17 reported output during the nine-month period, the Mines and Geosciences Bureau said in a report on Monday. (Reuters)
Egypt has filed legal complaint against zero ergot wheat decision -official
Egypt has filed a legal complaint against a court ruling issued last week that effectively reinstated zero tolerance of the common grain fungus ergot in wheat shipments, Supply Ministry spokesman Mamdouh Ramadan said on Monday. The government will retain an ergot tolerance of 0.05 percent in shipments, a common international standard, while the complaint is considered, Ramadan said. (Reuters)
South Africa’s NUM could serve strike notice Wednesday
South Africa’s National Union of Mine Workers will give notice of a strike at all mines represented by the NUM from Saturday in the event no agreement is reached in negotiations with the Chamber of Mines of South Africa by Wednesday, a source said Tuesday.
An offer was made by the Chamber after talks Monday, which the NUM will report to its members Tuesday before meeting with the Chamber on Wednesday, an NUM spokesman said.
The source said the offer was “very tempting” and several members represented by the NUM were willing to accept the deal, though any agreement must be accepted by all members as part of the centralized negotiations.
A 48-hour strike notice was originally going to be served last Thursday, before improved offers led to the postponement of the strike and the renewed negotiations Monday.
The NUM has been demanding a one-off Rand 1,100 ($78) payment for workers for 2017, an 8% pay rise for 2018 and 9% for 2019.
The Chamber represents Anglo American Coal, Delmas Coal, Exxaro Coal Mpumalanga, Glencore, Kangra Coal, Koornfontein Mines and Msobo Coal. (Platts)
Australian PWCS coal terminals’ vessel queue falls to six ships
Port Waratah Coal Services’ two terminals at Newcastle port in eastern Australia had six ships waiting offshore Sunday, down from 12 ships a week ago, the Hunter Valley Coal Chain Coordinator said in a report Sunday.
The ship queue for the PWCS terminals is expected to be fewer than five vessels at the end of November, the coal chain coordinator said.
The PWCS terminals shipped 2.4 million mt of coal exports in the week ended Sunday, up 608,900 mt from a week earlier, and the month-to-date exports totaled 5.2 million mt, the report showed.
Coal producers forecast ship arrivals in November at 8.1 million mt, at 10.4 million mt in December, and at 9.1 million mt for January.
Month-to-date coal exports throughput for Newcastle port’s railway were 9.01 million mt, HVCCC said.
Around 3.82 million mt of coal exports were shipped through the NCIG terminal at Newcastle month to date, according to S&P Global Platts data.
Carrington and Kooragang terminals at Port Waratah had combined stocks of 2.13 million mt available for export on Sunday, down 56,121 mt on the previous week.
Meanwhile, Gladstone port had 10 ships in its vessel queue Monday, and an additional four ships were loading coal exports at the Queensland port’s RG Tanna coal terminal, Gladstone Ports Corporation said. (Platts)
Russian wheat exports up 26.3% on year at 14.77 mil mt
Russian wheat exports from July 1, the start of the 2017-18 marketing year, to November 15, were up 26.3% year on year at 14.77 million mt, ministry of agriculture data showed Monday.
Export volumes have been picking up with harvesting over 97% completed, at some 88 million mt of wheat harvested as of November 16, the ministry said.
Russian exporters have also shipped 1.44 million mt of corn in the current marketing year, 0.7% lower year on year, and 2.77 million mt of barley, 81% higher year on year.
The main importers of Russian grains in the first two weeks of November were Turkey with 389,000 mt, Bangladesh with 224,000 mt, Saudi Arabia with 146,000 mt and Egypt with 126,000 mt.
Other big importers of Russian grains are Iran, Lebanon and Sudan. (Platts)
Iranian Apr-Oct iron ore exports up 11.8% year on year to 11.09 million mt
Iranian exports of iron ore in the first seven months of the Iranian year (April-October) were 11.8% higher year on year at 11.09 million mt, mines and metals state holding company Imidro said.
The exports had a value of $612 million, up 60.6%.
Iran imported 193,000 mt of metallurgical coal and coke in the period, 27% higher. Imports of met coal were expected to increase further following a fatal explosion in one of the country’s main coal mines in May, which shut the operation, an Iranian trader in Tehran said.
Iron ore exports will reach 20 million mt or more in the current Iranian year (to March 2018), mainly of iron ore concentrates, the trader said.
Most of the exports are from large state miners and private mines do not play a significant role in the export business, the trader said.
China is the main target market for Iranian iron ore, taking more than 90% of the country’s iron ore export shipments. (Platts)
BALTIC INDEX
Last Index Published Date: 21 NOVEMBER 2017
Baltic Exchange Dry Index 1396 +11
Baltic Exchange Capesize Index 3255 +41
Baltic Exchange Panamax Index 1275 -5
Baltic Exchange Supramax Index 856 +6
Baltic Exchange Handysize Index 625 -3
TIMECHARTER
‘Anangel Unity’ 2015 179818 dwt dely Cape Passero 01/03 Dec transatlantic round redel Skaw-Cape Passero $28,500 daily – Uniper
‘Hebei Tangshan’ 2012 93671 dwt dely Hong Kong 22/23 Nov trip via West Australia redel Singapore-Japan $12,500 daily – Panocean ‘Mykonos Wave’ 2012 87340 dwt dely Dunkirk 23 Nov trip via USEC redel Japan with coal $17,850 daily – Jera
‘Zheng Jun’ 2013 81810 dwt dely Lorient 20 Nov trip via USEC redel India $17,500 daily – Norden
‘Lady Giovi’ 2007 81791 dwt dely US Gulf 01/05 Dec trip redel Skaw-Gibraltar approx. $12,500 daily plus approx. $250,000 bb – Klaveness
‘Giacometti’ 2013 81731 dwt dely Las Palmas spot trip via Orinoco redel Singapore-Japan $19,350 daily – Sinoeast
‘Ocean Scorpio’ 2013 81687 dwt dely Qingdao 24 Nov/02 Dec 2 laden legs redel Singapore-Japan $10,000 daily – Louis Dreyfus
‘Christina B’ 2007 77072 dwt dely Gabraltar 27/30 Nov trip via Baltic & Saudi Arabia option Turkey redel Cape Passero intention grains $10,500 daily – Langlois
‘Lucky Star ‘ 2002 76662 dwt dely Longkou prompt trip via NoPac redel Singapore-Japan $9,000 daily – cnr – <recent>
‘Santa Rosalia’ 2008 75886 dwt dely Vizakhapatnam 22/24 Nov trip via Indonesia redel Japan $10,500 daily – NYK
‘Seas 14’ 2006 74477 dwt dely Meizhou 19/21 Nov trip via Australia redel China $8,300 daily 1st 35 days $9,000 daily thereafter – World Wide Bulk
‘Aeolian Breeze’ 2001 74225 dwt dely Ulsan spot trip via E Australia redel China $9,000 daily – cnr
‘Tai Profit ‘ 2001 73105 dwt dely aps Santos 01/15 Dec trip via PG redel PMO $14,500 daily + $450,000 bb – Copa Shipping
‘Mackenzie’ 2016 63226 dwt dely NC South America prompt trip redel Chile $24,000 daily – ED&F Man Shipping
‘Navios Mercury’ 2013 61393 dwt dely Jakarta 23 Nov trip redel Thailand $10,000 daily – cnr
‘Orchid Halo’ 2012 56174 dwt dely Hong Kong 22 Nov trip via Indonesia redel China $8,000 daily – Dragon Carrier
‘Densa Eagle ‘ 2010 55094 dwt dely Singapore prompt tripvia Indonesiaredel India $10,000 daily – cnr
‘Erasmos’ 2011 54863 dwt dely Continent prompt trip via Baltic redel Ashdod about 40 days intention sulphur $12,750 daily – Oldendorff
‘Ilfa’ 2001 52551 dwt dely Kandla 25/28 Nov trip redel China $9,600 daily – Bainbridge Navigation
‘Giovanni Topic’ 2002 52038 dwt dely Cebu prompt trip via Indonesia redel Vietnam $8,900 daily – China Navigation
PERIOD
‘Star Moira’ 2006 82295 dwt dely retro Haldia 10 Nov minimum 4/about 6 months redel worldwide $12,400 daily – cnr
COMMODITY NEWS
Oil prices were little changed as the impact from expectations of an extended OPEC-led production cut was cancelled out by rising output in the United States. Gold prices crept up ahead of the release the next day of minutes of the last U.S. Federal Reserve meeting, which could offer clues on the pace of potential interest rate hikes by the central bank. China aluminium futures fell sharply to their lowest in more than three months, dragged down by signs of robust global production. Chicago wheat futures lost ground for a second session, with abundant global supply pressuring prices. The dollar gave back some of its gains in Asian trading but stuck close to a one-week high against a basket of currencies as a German political deadlock continued to pressure the euro. (Reuters)
TANKERS
UAE’s ADNOC to venture into privatisation, oil trading
Abu Dhabi National Oil Company (ADNOC) has embarked on a major shake-up plan to privatise its services businesses, venture into oil trading and expand partnerships with strategic investors, its chief executive said on Monday. The partial privatisation plan marks a major shift by the state energy company that was founded in 1971. It aims to make ADNOC more competitive and commercially focused, operating in way that is more akin to other state-owned controlled peers. (Reuters)
Iraq’s southern oil exports rise to near record in Nov
Oil exports from southern Iraq have risen by 150,000 barrels per day (bpd) this month to close to a record high, according to shipping data and an industry source, as OPEC’s second-largest producer seeks to offset a shortfall from the north. Southern Iraqi exports in the first 20 days of November averaged about 3.50 million bpd, up 150,000 bpd from October, according to shipping data tracked by Reuters and independent tracking by an industry source. (Reuters)
Trafigura Confirms Plans for Pakistan’s Second LNG Terminal
Commodity trading and logistics company Trafigura has confirmed plans to develop a second LNG import terminal project at Port Qasim, Pakistan.
The decision was unveiled as part of the inauguration ceremony of Pakistan GasPort’s (PGPL) new LNG floating storage and regasification import terminal at the site, which will be served by the 170,000 m3 FSRU BW Integrity.
To more than double the country’s current LNG regasification capacity, the new terminal will supply 90 million cubic feet of gas per day to private buyers in Pakistan. However, even after the new terminal reaches full capacity a significant supply shortfall of the order of 19 million tonnes of LNG per annum is expected, according to Trafigura.
The company earlier announced plans for the second import terminal, without disclosing any details. The company now informed that it would partner with PGPL in developing a new merchant FSRU through the new project.
The project will include a new jetty, berth and a second FSRU, “benefiting from cost synergies with the existing facility. It offers the potential to turbo-charge import growth and rapidly scale up industrial use of LNG in the country,” Trafigura said. (World Maritime News)
Russia warns over Urals crude oil quality
The quality of Russia’s key Urals crude exports towards Europe will continue to fall next year as more of the country’s low-sulphur oil flows are diverted eastward to China, Russian national oil pipeline operator Transneft warned Monday.
Predicting a 2% rise in crude exports by Russian companies next year, Transneft said the sulphur content in its westbound export flows will reach “a critical level” this year, as the company has no further technological tools to improve the quality of crude flows headed west towards mostly European customers.
“Due to a [planned] rise in low-sulphur crude supplies to China, there will be no more low-sulphur volumes available for improving crude quality via other directions,” Transneft’s vice-president Sergei Andronov said Monday.
The increase in sulphur levels in Urals as Russia exports more premium crude through outlets in the far east of the country has long been predicted, and may support prices for rival crude grades such as neighbouring Kazakhstan’s high-value CPC crude.
The latter is exported through the Russian port of Novorossiisk via the CPC pipeline, which, unusually, is not owned by Transneft, but by an international consortium.
The rise of alternative crudes around the eastern Mediterranean, including CPC, Azeri and Kurdish crudes, has already depressed demand for Urals in recent years, pushing it to further flung destinations.
At the request of the energy ministry, Transneft maintains the quality of crude delivered to domestic refineries stable, at around 1.63% sulphur since 2014, Andronov said.
Increasing sulphur content poses a high risk to domestic refining because Russian refineries are only equipped to process crude with less than 1.8% sulphur.
As a result, the sulphur content in export flows rose to 1.61% from 1.51% over the same period, he said.
As a solution to the problem, Transneft has offered to direct high-sulphur crude into a separate export flow to Ust-Luga, but the energy ministry is reluctant to approve this plan. Sulphur content in ESPO blend remains at around 0.5%.
Eastward, crude exports via the Skovorodino-Mohe pipeline offshoot from the ESPO pipeline network to China are set to grow to 28.5 million mt in 2018, up from over 16 million mt this year, as Russia and China have mainly completed the expansion of the route, first vice-president of Transneft, Maxim Grishanin, said speaking during the same event.
In 2019, crude deliveries via Skovorodino-Mohe are to reach designed 30 million mt/year, he said.
Russia’s top producer Rosneft exclusively supplies crude via the route to CNPC, under two intergovernmental agreements, with the deliveries launching in 2010.
The East Siberia-Pacific Ocean (ESPO) pipeline ships crude to Skovorodino and further on to the Kozmino port on the Pacific coast, from which mainly spot cargoes are exported.
Transneft plans to complete the expansion of the entire ESPO network in 2020, bringing Kozmino’s capacity to 50 million mt/year, up from around 35 million mt/year currently, in 2019.
Transneft also expects to complete the expansion of the pipeline offshoot from ESPO to Rosneft’s Komsomolsk -on-Amur refinery to 8 million mt/year from 6 million mt/year currently in the second quarter of 2018, Grishanin said.
Looking ahead, Transneft said it expects crude exports by Russian companies to grow by around 1.8% year on year in 2018 to 242.4 million mt, or around 4.87 million b/d, according to preliminary shipping requests by domestic oil producers.
Andronov said Transneft expects deliveries in the western directions to reduce as around 10-12 million mt of crude will be redirected towards eastern markets in 2018.
“We think that westbound exports most likely reduce at the Primorsk and Ust-Luga ports [on the Baltic Sea], as crude supplies via the Druzhba pipeline are carried out mainly via long-term contracts,” he said, speaking at a company event. (Platts)
SHIPPING
Drewry: Ship Operating Costs Stabilise in 2017
The cost of operating cargo ships rose marginally in 2017 following two consecutive years of falls, but shipowners should prepare for higher costs led by a spike in insurance premiums, shipping consultancy Drewry said.
After two years of marked decline, average vessel operating costs stabilised in 2017 as pressure on owners was lifted by a nascent recovery across most cargo shipping markets.
The average daily operating cost across the 44 different ship types and sizes covered in Drewry’s Ship Operating Costs Annual Review and Forecast 2017/18 report rose 0.9% in 2017, following a 7.5% fall over the previous two years. Costs rose for most cargo sectors, with the exception of container shipping which achieved a third consecutive year of cost reductions.
“However, there are limits to how long cost cutting can be sustained,” Martin Dixon, Drewry’s director of research products, said.
Looking ahead, pressure to restrain costs will continue as many sectors remain overtonnaged and any recovery will rely on fragile fundamentals. Drewry said it expects costs under the immediate control of owners, such as manning, spares, repairs & maintenance and management & administration, to be tightly managed.
Large losses being booked by reinsurers for a series of natural disasters this year “will have the effect of driving up hull & machinery as well as P&I premiums in future years,” Dixon added.
“However, given the more benign outlook for the remaining cost heads, overall ship operating cost inflation is expected to remain moderate over the next few years,” according to Drewry. (World Maritime News)
ICS: Shipping Needs to Be Economically Sustainable
The shipping industry could only be environmentally sustainable if it is economically sustainable as well, the International Chamber of Shipping (ICS) told the OECD Working Party on Shipbuilding in Paris.
“The perennial challenge facing shipowners is overcapacity, aided and abetted by government subsidies and support measures that encourage shipyards to produce ships that are surplus to requirements,” Simon Bennett, ICS Director of Policy, said.
He further commented that, if governments are serious about helping the shipping industry deliver on the United Nations Sustainable Development Goals, the OECD needs to reboot efforts to have a global agreement on the elimination of market distorting measures from shipbuilding.
“Despite being in existence for over 50 years it’s disappointing that the working party on shipbuilding has still made little progress, with the last round of negotiations on a new OECD agreement having been suspended several years ago,” Bennett informed.
ICS also set out the progress that is being made to further improve the shipping industry’s environmental performance.
With regard to the implementation of the UN IMO Ballast Water Management Convention, Bennett said that, whenever possible, shipowners should only install treatment systems that have been approved in accordance with the revised and more robust type-approval standards adopted by IMO in 2016 in order to ensure that it would be fit for purpose in all operating conditions worldwide.
Regarding the 2020 global sulphur in fuel cap, ICS explained that in conjunction with other shipowner associations it is working on a proposal to IMO that the carriage of non-compliant bunker fuels should be banned in order to ensure fair competition.
Related to the development by IMO of a suitably ambitious strategy for the reduction of CO2 emissions by the international shipping sector, Bennett said that ICS’ vision is zero CO2 emissions as soon as possible using alternative fuels and new propulsion technologies.
“But so long as ships are dependent on fossils fuels, IMO Member States need to be both politically and technically realistic about what can be achieved in the short term if this is to compatible with the legitimate concerns of emerging economies about the impacts on trade and their sustainable development,” Bennett concluded. (World Maritime News)
Golden Ocean Returns to Profit
Norway-based dry bulk shipping company Golden Ocean Group Limited (GOGL) returned to profit in the third quarter of 2017 as dry bulk freight rates continued to improve in the period.
The company delivered a net income of USD 0.4 million for the three months ended September 30, compared with a net loss of USD 26.7 million reported in the same period a year earlier.
Operating revenues amounted to USD 127 million in the third quarter, up from USD 70.8 million seen in the three month period of 2016, driven by an increase in freight rates.
Dry bulk freight rates continued to improve in the third quarter, with market rates for all vessel classes above those from the previous quarter. Rates for Capesize vessels experienced the highest volatility among the vessel classes the company is exposed to and ended the quarter well above the rates for Panamax and Supramax vessels.
Global fleet utilization also improved during the third quarter. According to Maritime Analytics, fleet utilization ended at 84.5% in the third quarter, up from 81.6% in the third quarter of 2016.
“Thus far in the fourth quarter, rates have continued to improve, which should contribute positively to the company’s earnings in the quarter,” GOGL said.
“The company has taken a series of steps to maximize its market leverage by focusing commercial efforts on the vessel segments we believe provide the greater exposure to a recovery in the dry bulk shipping market,” Birgitte Ringstad Vartdal, Chief Executive Officer of Golden Ocean Management AS, said. (World Maritime News)
Navig8 Chemical Tankers Delivers Loss
Navig8 Chemical Tankers, a joint venture between the Navig8 Group and Oaktree Capital Management, has delivered a net loss in the quarter ended September 30, mainly due to lower rates.
The company’s net loss for the period was at USD 4.9 million, compared to the net income of USD 3.7 million, for the same three months of 2016. The decrease in net income is mainly attributable to lower gross average daily time charter equivalent (TCE) rates achieved in the period.
Revenue for the three months ended September 30, 2017 was USD 39 million, up from USD 35.8 million reported in the same quarter a year earlier.
The TCE rates earned by the A-Class, V-Class, T-Class and S-Class vessels in the quarter were USD 14,489, USD 12,933, USD 14,133 and USD 13,574 per day. The number represent a drop from the TCE rates seen in the same period a year earlier, when the ships earned USD 16,773, USD 17,514, USD 19,562 and USD 20,561 per day, respectively.
During the quarter, Navig8 Chemical Tankers completed its newbuilding program with the delivery of the 25,000 DWT stainless steel chemical tanker, Navig8 Sol, in August 2017. The ship was delivered under the sale and leaseback arrangements entered into with subsidiaries of SBI Holdings on May 19, 2017.
“Following the delivery of our final newbuilding vessel in August, Navig8 Chemical Tankers has one of the largest, most modern fleet of chemical tankers in the world,” Nicolas Busch, Chief Executive Officer of Navig8 Chemical Tankers, said.
“With growing demand for long haul trade and a rapidly declining rate of growth in the global fleet of large chemical tankers, market fundamentals are expected to tighten, which will provide a strong backdrop for operating our fleet,” Busch added. (World Maritime News)
Ship operators bullish for Supramax freight rates in Northwest Europe
Supramax freight rates in the UK Continent and Baltic are expected to tick higher in coming weeks, ship operator sources said, after scrap charterers were seen Monday circulating cargo requirements for mid-December dates.
With scrap charterers typically fixing stems 1-2 weeks out, their interest in mid-December dates indicates they expect freight rates to recover and are trying to lock in cheap prices now, sources said, after levels plummeted in recent weeks due to low cargo availability.
A lack of scrap and fertilizer cargoes saw freight rates in the region collapse since mid-October, with TCT rates dipping from as high as $18,000/d for scrap trips from the UK Continent to the East Mediterranean to the $13,000-$14,000/d range, while the Rotterdam to Aliaga scrap route basis 40,000 mt shed $2.50/mt over the same period to $16/mt on Monday.
Booming freight rates in the US East Coast and Gulf Coast have lent support to this notion, as tight tonnage in both regions has provided vessels open in the UK Continent with ballasting opportunities for early December dates. (Platts)
Liberia Scores a Win for Shipping in Brazilian Court
The Liberian Registry, in co-operation with the International Chamber of Shipping (ICS), has assisted the holder of a Liberian mortgage to overturn a decision of the Brazilian courts.
The registry informed that the decision, if left uncontested, “could have had serious adverse legal and economic consequences for the international shipping industry.”
Pursuant to the acquisition of the floating, production, storage, and offloading vessel (FPSO) OSX-3 in March 2012 by a Dutch company and following re-registration under the Liberian flag, the vessel was mortgaged in favour of Nordic Trustee ASA, a Norwegian entity acting as the security trustee and mortgagee of the vessel.
In an action before the lower court in Brazil, an unsecured third-party creditor, Banco BTG Pactual S/A Cayman Branch, challenged the status of the Liberian mortgage in Brazil on the grounds that the mortgage was not registered with the Admiralty Court of Brazil and that it was only filed with Liberia.
On November 16, 2017, the Superior Court of Justice in Brazil unanimously granted Nordic Trustee’s special appeal and the amicus motion filed jointly by the Liberian Registry and the ICS, of which the Liberian Shipowners’ Council is a member, against this decision.
The motion sought to clarify and rescind the lower court ruling, on the ground that it created uncertainty around the enforceability of mortgages for the majority of the world fleet – including those registers in major flag states such as the US, the Marshall Islands, China and Germany – when such vessels were trading in Brazil.
“Liberia took swift and decisive action following the decision of the lower court by filing the joint amicus motion to the main proceeding through its local counsel, Basch & Rameh. Liberia successfully submitted to the Court that the decision of the lower court would have an adverse legal and economic impact on the shipping industry, that it overlooked international conventions, and that it ignored international custom,” according to the registry.
Other ship registries, meanwhile, decided not to join the motion despite having major interests in Brazil and notwithstanding the possibility that their mortgages could be questioned and invalidated.
“This has been a long and difficult process but one we were determined to see through. Recognizing that the lower court decision could have been detrimental to international maritime trade, we decided to join as an amicus party early on. Although we were navigating uncharted waters, we knew this was the right decision,” Hara Gisholt, Vice-President, Business & Legal Affairs for the Liberian Registry, said.
“This is a historic victory for ship financing, international commerce and the Liberian maritime programme. The Liberian Registry’s swift and meticulous actions exemplify what we stand for – excellence, quality and being a true partner for our clients,” Scott Bergeron, CEO of the Liberian Registry, added. (World Maritime News)
S&P
Cosco Shipping Energy Orders Seven Ships from Dalian
China’s Cosco Shipping Energy Transportation has entered into agreements with Dalian Shipbuilding for the construction of HKD 4.32 billion (USD 553 million) worth of new ships.
Under the deals, signed on November 20, the company ordered four very large crude carriers (VLCCs) and three Suezmax tankers.
The new VLCCs are expected to be delivered in August, October, December 2020 and March 2021, respectively. While the Suezmaxes are set to join their owner in August and November 2020 and January 2021.
Cosco Shipping Energy Transportation said that an EGM will be convened for the shareholders to consider and approve the agreements.
The company has announced the proposed non-public issuance of A shares in an effort to finance the tankers. If the sale of shares does not proceed, the construction of the VLCCs and Suezmaxs is expected to be funded by the company’s internal resources or other means of financing including bank borrowings.
The company said that it opted for the move as it is “optimistic of the demand in the import crude oil transportation market and its persistent growth in the coming years.” (World Maritime News)