Market Secrecy Bad For Rates, Say Brokers
Increased secrecy in the tanker chartering market may be pushing rates lower, even though many brokers and owners like the idea of doing private business. Although it has always been a secretive business where only a portion of trading was made public, shipping sources say more and more tanker chartering is being done directly through a single broker rather than being put out to tender. However, ship owners and some brokers say charterers are able to dictate rates because they have more information about cargo and ship availability and can influence the perception of supply and demand. Despite this, most tanker brokers generally prefer private business even if it means they cannot compete for some cargoes.
Insurers Should Control Ship Classification System: Broker
Insurers should control the ship safety classification process in the light of weaknesses exposed by the Erika’s loss, a senior tanker broker said. Insurance companies should hold the mandate over who inspected vessels’ structural conditions and passed them as safe, an official at Marinav Shipping and Trading said. Since insurers pay out the claim, it is therefore in their best interest to ensure that the vessel is maintained so that risk is minimized, the broker said. The current system is flawed because ship owners appoint the inspectors and can apply pressure to receive “flexible” treatment in return for retaining their business, he said…
Tanker Trends
Freight rates for crude tankers loading early April in the Middle East were climbing early last week as shipowners held out for higher prices in expectation of heavy vessel fixing, brokers said. VLCC rates to the U.S. Gulf were expected to rise five or more Worldscale points to W62.5-65 ($10.75 per ton) for the next done fixture, some brokers said. Japan shipment prices were also lifting with the latest bookings at W70 ($7.50 per ton), up from W67.5 in the week before. "We believe this week will be heavy for one reason alone, there will be placement of barrels West to alleviate the shortage that the U.S. market is stressing," broker Marinav Shipping & Trading forecast in its March 13 report.
