BALTIC EXCHANGE PROVIDES DOLLAR ASSESSMENTS FOR TANKERS
The Baltic Exchange has announced plans to publish a daily time-charter rate for a variety of tanker types on a trial basis from January 2008. The rates will initially cover Very Large Crude Carriers (VLCCs) with trials of similar derived rates for other vessels following shortly thereafter.
The Time-Charter Equivalent (TCE) will be calculated using a variable feed of bunker costs from relevant bunkering ports from authoritative sources and exchange rates for adjusting port costs.
The draft vessel description and approach to the calculation are as follow, and the Baltic is asking for market feedback before details are firmed up.
VLCC
300,000 mt dwt, double hull
14.5 knots on 90 mt IFO (average laden/ballast)
In port: 2 days pumping 85 mt ifo mt per day
3 days idle 27 mt ifo per day
Routes:
The published time-charter equivalents will be an average of the rates derived from TD1 and TD3.
TD1: 280000 mt Ras Tanura/LOOP laydays cancelling 20/30 days in advance max age 20 years - bunkers based on Fujairah and/or St. Eustatius 3.75% ttl commission. For the purpose of the calculation, bunker prices will be drawn from Fujairah and St.Eustatius on a 50/50 basis.
The TD1 calculation will be based on current market practice of ballasting the vessel back via the Suez Canal.
TD3: 260000 mt Ras Tanura/Chiba laydays cancelling 30/40 days in advance max age 15 years - bunkers based on Fujairah. 3.75% ttl commission.
All Baltic Exchange tanker assessments are currently expressed as Worldscale.
The move is expected to help the tanker freight derivative industry price its contracts in a more transparent fashion.
Baltic Exchange chief executive Jeremy Penn said:
“Expressing tanker assessments as a dollar timecharter equivalent is an important step for a significant number of trading companies and will help develop the tanker FFA market. If the trial proves successful, we will extend our TCE assessments to cover four vessel sizes. Providing the market with a branded, accurate and independent dollar calculation will prove to be a very useful service.”
ENDS
For further details please contact Bill Lines, Navigate PR
T: +44 (0)20 7369 1653
E: blines@navigatepr.com
Notes to editors
Worldscale is a pricing system for tankers run by the Worldscale Association which enables owners, charterers, and brokers to determine market levels based on a $/metric ton reimbursement for an estimated 70,000 port-to-port combinations.
The Baltic Exchange is the world's only independent source of maritime market information for the trading and settlement of physical and derivative contracts. Its international community of over 550 members encompasses the majority of world shipping interests and commits to a code of business conduct overseen by the Baltic.
Baltic Exchange members are responsible for a large proportion of all dry cargo and tanker fixtures as well as the sale and purchase of merchant vessels.
