Suezmax Tankers: Lifeline Ahead?

MarineLink.com
Tuesday, December 17, 2013
Tankship image courtesy of Torm

Despite the firming of broader demand fundamentals short-term, the Suezmax sector still faces more wild cards that other sectors in the years ahead, considers Poten & Partners in a recent Market Opinion from their Commodity Consulting & Analytics department. Excerpts follow:

Last week, the Suezmax sector finally began to cash in on the freight rate gains exhibited by their larger VLCC cousins over the past two months.

Historically, these two markets have tended to move in tandem since both vessel sizes service West African export requirements. Because cargoes in West Africa are generally stemmed in one million barrel parcels, charterers can arbitrage the differential in freight rates by co-loading two cargoes on one VLCC instead of chartering two Suezmaxes.

As a result, strong VLCC rates have allowed for upward movements in Suezmax rates. While this current uptick in freight rates might merely be seasonally-lived, longer-term positives exist for this semi-slighted sector.

Two additional factors helping to drive the Suezmax market outside of the general correlation with VLCCs are the growth in exports from West Africa to the East and a potential balancing of the orderbook against possible demolition candidates aged 15 years or older that is likely to take place in the next few years.

Suezmax fleet excess unlikely
From a supply perspective, the best news for existing Suezmax owners is the small size of the orderbook relative to the number of vessels 15 years or older. The current orderbook amounts to a little more than 10% of the 440 ship fleet; however, 13% of the fleet is 15 years or older suggesting that there may be slight contraction in the fleet over the next several years.

The development of new trade patterns, particularly those with longer voyages, has led to unpredictable regional availability; bucking monthly and seasonal trends for supply and demand. At the end of the day it will be the moderation of tonnage supply will be the most important factor in supporting rates going forward.

 Source: Poten & Partners
www.poten.com
 

 

 

Maritime Reporter April 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

New CEO for Evergas

Evergas has appointed Steffen Jacobsen as CEO of the company as of 8 May 2015 Mr. Jacobsen joined Evergas 1 February 2015 as Vice President, Fleet after almost 35 years in Maersk.

NCSP Group Cargo Traffic Up 6% in Q1 2015

Novorossiysk Commercial Sea Port Group (NCSP Group or the Group) (LSE: NCSP, Moscow Exchange: NMTP) reports that Group’s consolidated cargo turnover in Q1 2015 increased by 2 million tonnes or 6.

Naming Ceremony of Evergreen's EVER LYRIC

Evergreen Group today held the naming ceremony for EVER LYRIC, the eighth of its L-type vessels built by CSBC Corporation in Taiwan. The ceremony took place

Tanker Trends

Liner Service Reliability Jumps to 64%

According to Drewry Supply Chain Advisors, liner shipping service reliability on the three East-West trades showed an aggregate on-time performance of 64% in March - a five-month high.

Suezmax Tankers Bullish

Global fixture activity for suezmax crude tankers rose in the first quarter by 5% year on year, with most of the activity coming out of West Africa.   Suezmax

MacGregor's Pusnes bow loading systems for Suezmax Tankers

MacGregor, part of Cargotec, has secured contracts to supply Pusnes bow loading systems for three newbuild shuttle tankers intended for operations in Brazilian waters.

Finance

Seaspan Takes Delivery of New Containership

Seaspan Corporation (SSW) has accepted delivery of a 14000 TEU containership, the YM Wellhead.    The new containership, which was constructed at Hyundai Heavy Industries Co.

'Make in India’ - the Newbuzzword in Indian Shipping Sector

The Prime Minister Narendra Modi's  'Make in India’ initiative offers a plethora of opportunities in the maritime sector, particularly in shipbuilding, with the

Baltic Index Perks up on Increased Rates for Bigger Vessels

The Baltic Exchange's main sea freight index, which tracks rates for ships carrying dry bulk commodities, edged higher on Thursday as rates for bigger vessels rose.

Logistics

Liner Service Reliability Jumps to 64%

According to Drewry Supply Chain Advisors, liner shipping service reliability on the three East-West trades showed an aggregate on-time performance of 64% in March - a five-month high.

Suezmax Tankers Bullish

Global fixture activity for suezmax crude tankers rose in the first quarter by 5% year on year, with most of the activity coming out of West Africa.   Suezmax

Seaspan Takes Delivery of New Containership

Seaspan Corporation (SSW) has accepted delivery of a 14000 TEU containership, the YM Wellhead.    The new containership, which was constructed at Hyundai Heavy Industries Co.

 
 
Maritime Careers / Shipboard Positions Maritime Security Navigation Offshore Oil Pipelines Pod Propulsion Port Authority Ship Electronics Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2114 sec (5 req/sec)