Realities of a multi-fuel future
Decarbonising the shipping industry is a complex challenge, yet a wholesale switch to green fuels would go a long way towards meeting net zero ambitions. However, that switch is being hampered by a lack of demand-side signals for greener shipping from policy makers, suppliers of goods, and consumers, making it difficult for the industry to move forward with confidence. Additionally, apprehensions about the use of greener fuels – including the potential for health, safety, and environmental concerns, higher costs, lower energy density, and limited availability at ports of call – are compounding demand-side challenges, according to the Global Maritime Forum (GMF).
Surge in Panamax newbuilding orders
There has been a surge in Panamax newbuilding orders in the first four months of 2023. So far this year there have been 61 orders placed, compared to just 13 for the same period in 2022, an increase of c.369%. The majority of these orders have been placed since March, coinciding with an uptick in Bulker spot earnings as confidence in this sector begins to grow once again. After falling to a two and a half year low of around 5,900 USD/Day in February, spot rates have more than doubled to reach around 13,600 USD/Day, an increase of c.131%. The overwhelming majority of these orders have been placed by Chinese companies, accounting for c.71% of orders. Canada ranks second with c.13% of orders and Greece ranks third with c.7%.
Tanker market resurgence underway
The Tanker market’s long term fundamentals appear to be quite favorable, as the global orderbook is still at just 3% of the total fleet, while oil production and demand are expected to remain at healthy levels moving forward. In its latest weekly report, shipbroker said that “with a robust US growth of 5.5%, bringing volumes to 18.8 million bpd this year, it is predicted that global oil output would increase by 1.3% to 101.7 million barrels per day in 2023. On the demand side, due to weakening economic trends, the world’s demand for oil is expected to climb by about 2 million bpd in 2023 after rising by over 2.4 million bpd in 2022.
Ship recycling market picks up pace
The Ship recycling market has come back to life over the past few days, as a result of more container candidates entering the market. In its latest weekly report, shipbroker said that “as we enter the summer period (where’s the sun) and the end of the Eid celebrations, the market has sprung into life again with a cluster of new container units circulating for sale from various well-established liner companies. Buying activity has also ramped up on the back of a potential continuous flow of tonnage following a somewhat barren period, however we are hearing of weaker domestic steel markets which may affect sentiment from the waterfront.
Dry bulk market: a positive week for capesizes
After the surge of activity in the middle of the week, the Capesize market calmed on Friday to welcome the long weekend approaching in most of the countries in both basins. The time charter average settled at $19,080, rising $2,810 week-on-week. The Brazil to China and west Australia to China both further improved compared with the beginning of the week, to $22.728 and $9.043 respectively. The backhaul route also finally came back to positive territory after a long wandering in the negative. In the North Atlantic, there was talk of tonnage supply tightening. On the period front, the Boston (177,827 2007) delivery Zhenjiang 4/14 May was fixed for 14/17 months at $17,000.
EU carbon levy pressurises metal
An initial agreement between the European Parliament and Council on a Carbon Border Adjustment Mechanism (CBAM) to crack down on carbon leakage will have ramifications for aluminium trade, and possibly before the end of the year. While the agreement still needs to be confirmed and adopted by EU member states and the European Parliament, the provisional agreement of a transitional phase could be in place by October. The CBAM is designed to shore up the EU’s Emission Trading System (ETS) and aid the bloc’s goal of carbon emission reduction of 55% by 2030 compared with 1990, leading to net zero by 2050.
Russian oil acts a disruptor in oil shipping routes
The Redrawing of the global oil trade has been a mainstay after the was on Ukraine, with Russian oil flows acting as a major disruptor in the market. In its latest weekly report, shipbroker said that “the European ban on the imports of Russian products came into effect in early February and expectations at the time were that the country’s clean petroleum product (CPP) exports would come under pressure. However, Russian exports have actually increased compared to levels seen last year.
The increasing efforts to tackle shipping emissions
Liquid Wind releases White Paper on the economic implications of e-fuel Well-to-Wake emissions compared to alternatives. The development is moving rapidly in the eMethanol and e-fuel space. In the white paper we dig into these increased efforts and show why eMethanol is the best alternative to fossil fuels. The shipping industry is stepping up its efforts to reduce its carbon footprint. More and more companies are setting targets and offering green shipping solutions to their customers.
Brazil record soybean crop could add fuel to the dry bulk market
The Dry bulk market could receive further boost from a record Brazilian soybean crop. In a recent weekly report, shipbroker commented that “this year is expected to be a record year as far as the Brazilian soybean crop is concerned. Forecasts say that the country will produce 153 million mt and will export 92.7 million mt. Usually, the country’s export season runs from February to June, but this year it is going to be different, since the heavy rains in Brazil are likely to push the record crop to the second half of the year.