Daily Briefing January 21 2021
Free to read: Freight rates push derivatives trading to 12-year high | Is there still competition in liner shipping? | Tight bunker fleet seen disrupting scrubber economics
Good morning. Here’s our quick view of everything you need to know today.
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What to watch | Analysis | Opinion | Markets | In other news
What to watch
Economic turbulence and volatile freight rates are rapidly increasing trade in forward freight agreements – a little-understood and under-used mechanism to hedge against rising or falling vessel chartering costs.
There is much less competition in liner shipping than commonly assumed, due to a proliferation of vessel sharing agreements or consortia which provide carriers with the knowledge and capabilities to adjust ship capacity rapidly in line with changing demand, writes Olaf Merk, ports and shipping administrator at the International Transport Forum.
Tankers used for refuelling ships with 3.5% high-sulphur fuel oil are no longer as readily accessible in Singapore, the world’s busiest bunkering hub.
Dry bulk owners are optimistic of signs of a possible reversal of the decade-long market slump.
Analysis
A UK company is aiming to commercialise and mass produce Molten Salt Reactor technology for the transport and industrial sectors.
While the number of containers lost annually from boxships may be a small fraction of the total carried, there is still room to improve the stowage and lashing on vessels.
Opinion
From the News Desk: The deeper sources of Gulf of Guinea piracy are not going away. Until talk turns to action, operators must protect their ships and train their crews if they are to avoid becoming another statistic.
Markets
Weekly Briefing: Box bottlenecks look likely to fuel high rates for the foreseeable future and dry bulk owners have been rejoicing at the unusually positive start to the year. Tanker owners, however, are contending with a negative, pandemic-fuelled outlook — spot earnings on most benchmark routes are below operating costs.
Mining giant BHP has reduced its coal guidance for its full financial year as a number of events impacted production.
Panama Canal policy changes for liquefied petroleum gas tankers and fleet drydocking requirements will continue to strengthen very large gas carrier freight rates this year, according to Poten & Partners.
In other news
Greek shipowners topped the charts for secondhand vessel purchases last year but were reserved about penning newbuilding orders, according to records maintained by shipbrokers.
The order momentum for very large gas carriers continues, with Korea Shipbuilding & Offshore Engineering announcing an Won87.5bn ($79m) deal with compatriot South Korean shipping company KSS Line to build a liquefied petroleum gas carrier.
Pacific International Lines, in a plea for support from creditors to stave off liquidation, revealed that its founding family is backing the debt proposal on the table calling for dilution of equity held by existing shareholders to less than 15%.
Pacific Basin, a Hong Kong owner and operator of dry bulk vessels, said it has appointed Martin Fruergaard as chief executive to replace Mats Berglund.
Port of Los Angeles executive director Gene Seroka has announced two new measures aimed at improving the speed of drayage trucks through terminals at the Southern California facility.
Scorpio Bulkers, the US-listed owner looking to exit the sector, has agreed the sale of two more ultramaxes.
The outgoing administration in the White House issued a flurry of fresh sanctions on maritime assets in connection with Russia, Venezuela and Iran, coming on the eve of Donald Trump’s departure from office.
The port of Long Beach moved more than 8.1m teu in 2020, setting a record in the face of economic uncertainty due to the Covid-19 pandemic and the trade war with China.