IMAREX - ASIAN CLEAN TANKER FFA REPORT 8 Feb, 2010

IMAREX - ASIAN CLEAN TANKER FFA REPORT   8 Feb, 2010

Imarex Academy – Professional FFA Trading Courses in London and Sydney, March 2010

You are invited to attend the Imarex Academy Professional FFA Trading Courses in London and

Sydney in March 2010. Seize this opportunity to learn how to trade freight futures effectively and

to gain a detailed perspective of the tanker and dry bulk freight derivatives market. For more

information please refer to the Imarex Academy website http://www.exchange.imarex.com/imarex-academy/category488.html .

 

Clean Tanker FFA Summary:

TC4 (MR SG-JP 30KT) Feb kicked off the day with 135 lifted but ended 133.5 at 135 for a small decrease on the day. Q2 traded 5 points under Jun as a spread indicating a deepening of contango. Q2 closed 140 at 145, Q3 143 at 152 and Q4 155 at 157.5 for little movement on the day.

 

TC5 (LR1 AG-JP 55KT) Feb paper held fairly flat with 135 and 135.5 done, but the back end was pushed lower. Q3 was given at 139 and Q4 at 147, flattening the forward curve. Q4 was working 144 at 149 at the close and the Feb-Dec strip slipped to 138.5 at 142.

 

For Platts TC4 & TC5 Spot please refer to the IMAREX trading screen.

F F A s @ C l o s e

 

 

 

 

 

 

TC4

NET

TC5

NET

TC11

NET

SPOT BITR

133.57

-0.57

143.08

-2.13

$7.14

-$0.05

FEB10

134.50

-0.50

135.50

+0.50

$7.32

-$0.03

MAR10

140.00

+0.00

131.00

-2.00

$7.58

-$0.05

APR10

139.00

+0.00

134.00

+0.50

$7.81

-$0.04

Q210

141.00

+0.00

134.50

-0.67

$8.06

-$0.03

Q310

147.00

+0.00

139.00

-4.00

$8.70

+$0.00

Q410

155.00

-1.00

147.00

-5.00

$8.87

+$0.00

 

Physical market talking levels:

MR: Sing/Jpn estimate W130 The PACIFIC OASIS if true is a full 12 points lower than the RAFFLES PARK reported here on the 29th.  It often takes some time for lower AG rates to play out into Singapore, but this surely cannot bode well for MRs here.

 

LR1: Ag/Jpn estimate W145-140 With no immediate long-haul arb in sight, the lack of demand of the last week in doing a job on rates. Expect more of the same until the cargoes start flowing.

 

LR2: Ag/Jpn estimate W140 We have to look back to the 25th of Jan for a fronthaul fix rate, last concluded at W145. With the passage of time, the once thin tonnage list is beginning to look amply supplied for Feb and will certainly leave vessels waiting into March.

 

Reported fixtures:

ST TBN

35

CPP

08-Feb

WCI

AG-RSEA

$300K-500K

 

CNR

GULF RASTAQ

35

CPP

17-Feb

AG

EAFR

RNR

SUB

CNR

TORM MARY

35

CPP

05-Feb

AG

SING

RNR

SUB

VITOL

YUE CHI /ICE

30

CPP 

19-Feb

JINZHOU

SING-OPTS

$540K

FXD

ARCADIA

ZHU JIANG

35

NAP

15-Feb

WCI

JPN

W160

FLD

ITOCHU

ATLANTIC MUSE

35

CON

6-Feb

X

AG

$130K

FXD

VITOL

ARYTON II

40

CPP

23-Feb

DALIAN

SING

$295K

FXD

CNR

BLUE EMERALD

34

NAP

24-Feb

     WCI

   TWN-JPN

RNR

FXD

CNR

CHANG HANG XIN YUN

30

CPP

14-Feb

SING

CHINA

RNR

FXD

CNR

NARA

40

CPP

14-Feb

SING

SAFR

$900K

FXD

VITOL

ORIENTAL EMERALD

40

GO

20-Feb

NAKH

SING

$360K

FXD

CLEARLAKE

PACIFIC OASIS    

35

NAP

23-Feb

AG

JPN

w148

SUBS

SHELL

CANCALE STAR

55

CPP

15-Feb

AG

WEST

RNR

FLD

CNR

EAGLE HOPE           

65

CPP 

07-Feb

JPN

SING-UKC

$450K-$2M

COR

CONOCO

TORM OTTOWA

70 DW

 

 

1+1 YRS

 

$16.3-17.3K/D

 

 

TORM TAMAR

70 DW

 

 

1+1 YRS

 

$16.3-17.3K/D

 

 

OCEAN QUEST

LR2

 

 

FUJ 4/2

 

 

FLD

 

TORM MARGRETHE

75

NAP

24-Feb

RSEA

TWN

COA

FXD

CPC

LIMERICK SPIRIT

90

 

T/C

40-70D

DNR

$19.5K

EXT

VITOL

RATNA SHALINI

80

UNL

10Mar

SKOR

BRZL-UKC

RNR

SUBS

PETROBRAS

 

Posted on Mon, February 8, 2010 at 21:49 by Registered Commenterton mile spore | CommentsPost a Comment

I Can't Explain

Worst.  Idea.  Ever.

Posted on Mon, February 8, 2010 at 06:11 by Registered Commentermike reardon | CommentsPost a Comment

Brief Reports Today and Rest of Week

- Bloomberg Radio:  Today – 3pm EST – I will be on with Jeffrey Pribor of GMR and Akis Tsirigakis of SBLK.

- Tuesday 9th don’t forget the Hellenic-Norwegian Chamber of Commerce Shipping Event in NYC…and on Wed-Thurs 10th-11th BB&T is hosting their annual Transportation Services Conference in Miami.

Posted on Mon, February 8, 2010 at 05:54 by Registered Commentermike reardon | Comments1 Comment

Equities

Capital Link Indices
Maritime:    1808.53   -24.44   -1.33%
Tanker:       2132.17   -40.32   -1.86%
Dry:           889.88       1.75       0.20%

Posted on Mon, February 8, 2010 at 05:54 by Registered Commentermike reardon | CommentsPost a Comment

Dry Bulk

Baltic Indices
BDI 
BCI   
BPI   
BSI  
BHSI 


Martin Korsvold:  Inventories of iron ore at Chinese ports are reported at 68,5 mill tons at the end of last week, up 0,85 mill tons WoW. The iron ore market posted a modest rebound last week with the spot price moving up ~5% to USD 125.9/pmt for 62% FE delivery CFR Tianjin, whilst the 2010 curve appreciated 4-5%. The rebound came on the back of higher activity ahead of the Chinese New Year holiday which starts at the end of this week. In addition there are rumors that the Indian government will increase the royalty on export ore to 15%, up from the 5% set in December. If true this would have a positive impact on the prices.

Dry FFAs  - light volume as prices sell off, though Capes currently have support at these levels

              Spot                              
Q2 FFA       
Cape:  
                                    34750, down 1500
PM:                                          25750, down 750
SM:                                          21750, down 500

Posted on Mon, February 8, 2010 at 05:53 by Registered Commentermike reardon | CommentsPost a Comment

Tankers

Crude
VLCC Ag/East      85     ($49k)     softer
SM Wafr/Usac      87.5  ($16k)     about same, possibly touch softer
Feb AG                 70 
March AG             0      
Feb Wafr bbls       81m  
March Wafr           7m   
Turkish Straits       5n/3s  down 3  
Fujairah bunkers   448      down 2       

Physical:  Limited activity brings softer sentiment and in some cases softer rates.  Some cgos are seeing a large amount of offers come in – thereby allowing Charterers room to leverage rates down.

Crude FFAs:  
Trading is off to a slow start and bid/asks provide few clues as to the state of today’s sentiment, though the market seems largely in line with Friday’s closing levels:   TD3 Feb 80, TD3 March 69, TD3 Q4 75.

Clean
37kt Cont/ta        180     ($12k)    about same
38kt Caribs/up     145     ($6k)      about same, soft tone
55kt Ag/East       140     ($13k)      softer

Physical:  Wafr activity has kept regional demand alive, though overall sentiment in the Atlantic basin in somewhat weak.  Eastern rates are showing a soft underbelly as well as rates on a few trade lanes move a touch further to the downside.

FFAs:  
Negligible activity thus far.  Bid/asks imply that we remain close to closing levels for time being.  TC2 Feb 178, March 158.  TC4 Feb 135, TC5 Feb 135.

Posted on Mon, February 8, 2010 at 05:53 by Registered Commentermike reardon | CommentsPost a Comment

Dry Bits

Baltic Dry Index closed @ 2715 down -133 points or -4,67% for the week.  Top/bottom performances

SBLK +5.93%, SB +3.29%, DSX +2.04%// NMM -11.91%, OCNF -9.63%, EXM -8.32%

FIDELITY MARI has chartered the Genco Knight (GNK) a 73,941dwt Panamax built in 1999. Laycan was set for Feb 4-6th at IMMINGHAM on the Humber Estuary (a large tidal estuary on the east coast of Northern England) >via USG > CHINA at a rate of USD 34,500 daily.  Immingham is the UK’s largest dry bulk-handling port. Cargoes, such as coal, ilmenite, petroleum coke, titanium slag, ferrous alloys, pig iron and pyrites, are regularly handled at the port’s in-dock and deep-water riverside facilities.  I could not find the harbor masters report telling us whether she will be laden departing the UK.

 

Mining Australia: “Rio Tinto is demanding a 40% rise in the benchmark iron ore price following negotiations with Japanese and Korean steel mills.  According to the report, the Chinese are unlikely to accept any raising of the benchmark price above 30%.  Another source was reported as saying that the Korean and Japanese steel companies could be willing to accept up a 40% rise in the benchmark.”  I hope we don’t see any negotiators end up in jail this year.  My first few years in shipping equities I failed to understand the significance of the benchmark.  Now this unfortunate annual reality leaves me glued to the news, fully understanding I cannot believe a word I read. 

 

Fairplay:  Russia is being accused of dumping nuclear waste into the Baltic Sea in the early 1990s, the BBC reported today.”  Nowadays in good old Russia, the Mafia gets paid to handle ship scrapping and other tedious environmental concerns.  What a bunch of thugs.  Give a hoot, don’t pollute!!!

 

Good Fortunes

 

Posted on Sun, February 7, 2010 at 03:55 by Registered Commenterdry bulk dave | CommentsPost a Comment

Dry Bits

"On The Rocks”

The ice can normally (each winter) be counted on to provide an effect on rates similar to port congestion.  With more vessels available than cargoes, the only ice discussed recently at a fixture negotiation relates to beverages.    

Fearnleys Weekly

Capesize  “ Market appears generally overtonnaged, and ballasters face a hard time.”

Panamax  “ With a negative amount of spot cargoes compared to number of spot vsls, and the ice in the Baltic didn´t improve the situation.” 

 Turning to the market today I spotted GNK (Genco) @ 18.75 surprising myself as I resisted.  Way  2 much bad karma for this week and next.  In the last four weeks GNK is down 26% and when the sector swings, we all know how well this stock performs.

Reader Comments provided by Brewer;

”NMM is tax advantaged in that a portion of the distribution is treated as a return of capital and the balance is qualified dividends taxed at a max 15%. Plus they do not issue a k-1. Anyone who has wrestled with a k-1 can attest that this is a considerable benefit for an MLP.

And a pont of clarification: I said that NMM is a simple proposition, not that NM was simple. NMM is simple. They own ships that are on long term charter and they pay out all their excess cash. This is what DSX was before Mr. Palios chose to build up a warchest of cash to go bottom fishing with. The Omnibus agreement is lengthy, but most MLPs have big, ugly documents that set the rules of engagement between GP and LP.

NM is indeed a more complicated entity, and very hard to forecast quarterly earnings for. However, it is not hard to see the longer term business sttrategy that Ms. Frangou pursues with NM as the centerpiece (and NMM, NNA and eventually NSALI as offshoots): buy dollars for 50 cents, use a sane amount of leverage to juice returns, and build net worth on a massive scale over the long term without too much worry about how an individual quarter turns out. What is not to like about that?”

"Very much appreciate your blog and enjoy reading it."

Thanks for your informative and well articulated reply.  The exchange of information and opinions that may be of benefit to investors is what this is all about.

Good Fortunes

 

Posted on Fri, February 5, 2010 at 11:41 by Registered Commenterdry bulk dave | CommentsPost a Comment

Jonathan Chappell has released his 2010 Dry Bulk Outlook

Posted on Fri, February 5, 2010 at 08:19 by Registered Commentermike reardon | CommentsPost a Comment

Tankers

Crude
VLCC Ag/East      90     ($54k)     down $29k since last week
SM Wafr/Usac      87.5  ($16k)     down another $6k since last week
Feb AG                 70 
March AG             0      
Feb Wafr bbls       81m  
March Wafr           7m   
Turkish Straits       6n/5s  about same  
Fujairah bunkers   450      down 10 from 1 week ago       

Physical:  Activity has slowed a bit, allowing rates and/or sentiment to decline a touch further.  The cgo count is healthy thus far – though with Feb being a short month – it could be considered in line with where we stood last month.  The difference being, the cgo count ely in Jan was light and had to make up ground in a hurry – thereby providing mojo…and boosting rates.  The Feb count is not light – and therefore may not provide the type of upside burst we saw in Jan.

Frode Morkedal:  Frontline buys and sells a VLCC. Today, Frontline announced that it has agreed to acquire the VLCC "Front Vista" (1998 built) from Ship Finance at a purchase price of USD 58.5m. Frontline has furthermore agreed to sell the vessel and the buyer will settle the purchase price through the payment of installments over a 10 year period. The price the buyer pays to Frontline was not given.

Crude FFAs:   TD3 volume has been good/fair.  March trades down 1.5 points to 70 and is offered over at that level.  Q4 trades down 2 points to 75 and is offered over at that level.  TD5 Feb remains priced in the 87/90 range.


Clean
37kt Cont/ta        180+ ??    ($12k)    wide range….ws 200 reported
38kt Caribs/up     145           ($6k)      unchanged, quiet
55kt Ag/East       145            ($14k)      on downtrend


Physical:  Reports of ws 200 for some Cont/ta activity make it difficult to reconcile where rates might stand, but the higher numbers seem to represent outliers rather a consensus market level.  The
Bald Viking of Southport reports that Hovensa in St Croix will be down for scheduled maintenance until at least Feb 23 – thereby limiting Caribs activity…but possibly encouraging a few marginal Cont/ta bbls.  Wafr activity is still reported as “unusually” good.  Thank you Trygve.

FFAs:   Good/fair volume on TC2.  Feb and March both trade within a point of their closes at 180 and 160, though the Feb contract is not showing obvious support.  TC6 Q3 trades flat at 145.  Eastern volumes have been light.  TC4 and TC5 trade flat – both at 135.

Posted on Fri, February 5, 2010 at 08:19 by Registered Commentermike reardon | CommentsPost a Comment
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