[ID] => 10002
[post_author] => 34
[post_date] => 2018-08-21 09:32:51
[post_date_gmt] => 2018-08-21 08:32:51
[post_content] => Global seaborne LPG trade is expected to grow by 3.5 per cent this year to 95.1m tonnes, according to Facts Global Energy. That will provide employment for LPG carriers of all sizes but in many segments fleet growth is outpacing demand. It is only in the fully pressurised segment that additions to the global fleet are currently lagging demand and the past year has shown some significant improvement of earnings.
Epic Gas, which has a young and modern fleet of 39 vessels and is the largest commercial operator of pressurised LPG carriers, reports that average market rates for its 3,500-m³ ships were up 36 per cent year-on-year in the second quarter; the increase for its 5,000-m³ vessels was 24 per cent. Only in the larger segments, where there is more competition with semi-refrigerated carriers, were earnings flat or slightly off.
“Fleet supply in the smaller vessels segment where we operate remains contained taking into account minimal newbuilding deliveries scheduled for the next three years and a growing pool of scrapping candidates from older vessels,” says Charles Maltby, CEO of Epic Gas.
Timecharter equivalent earnings per vessel/day rose 13.7 per cent overall compared to the second quarter 2017, with fleet utilisation running at 92.9 per cent.
ALL AROUND THE WORLD
Epic Gas is active in all geographic locations and so has a unique perspective on the market for pressurised LPG carriers. It notes that, during the second quarter, heightened activity in north-west Europe persisted until the summer lull set in late in the period. There was better employment for larger vessels compared to the prior period, with shippers moving larger parcel sizes and willing to pay firmer rates.
The Middle East was busy with LPG and petrochemical exports during the second quarter. The region saw an increasing presence of the largest sized pressure vessels to serve growing markets in Pakistan, Bangladesh, Sri Lanka and, more recently, Sudan.
The market in Asia remained firm for most of the quarter. China’s propylene imports remain an important driver in the 3,500-m³ and 5,000-m³ sector and imports during the second quarter are understood to have remained at the previous period’s level of 230,000 tonnes.
Things have been less happy elsewhere. The Mediterranean/Black Sea spot market was generally quiet, with weak export activity from Russia and the Ukraine and contractual volumes being moved largely by trader-controlled tonnage.
While US LPG export volumes continue to increase, they mainly benefited larger LPG carriers in the second quarter, with volumes moved by pressurised and smaller semi-refrigerated ships down by 22 per cent compared to the first quarter. This was mainly felt in transatlantic cargoes to the Mediterranean and West Africa, which disappeared from the market.
Epic Gas states that there are currently 324 fully pressurised gas tankers of 3,000 m³ capacity or more on the water (excluding domestic Chinese-flagged tankers), with only eight newbuildings due to be delivered by the end of 2020. Conversely, there are currently 12 ships of 28 years or older, which makes them likely candidates for scrapping. Fleet growth in the next two years is therefore expected to be extremely low, if not negative, which will further tighten the market in those locations where demand remains firm.
[post_title] => LPG: Sweat the small stuff
[post_status] => publish
[comment_status] => open
[ping_status] => open
[post_name] => lpg-sweat-small-stuff-2
[post_modified] => 2018-08-20 17:37:41
[post_modified_gmt] => 2018-08-20 16:37:41
[post_parent] => 0
[guid] => https://www.hcblive.com/?p=10002
[menu_order] => 0
[post_type] => post
[comment_count] => 0
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LPG: Sweat the small stuff
Improved earnings for fully pressurised ships are no surprise, merely the expected outcome of restrained newbuilding activity and firm demand