News & Media

18 December, 2020

Australian Newsletter - Issue 657

MARITIME MARKET UPDATE: MARKET IS BACK TO DEMAND RECOVERY UNCERTAINTY
Source: International Shipping News (Hellenic Shipping News)
Risavika LNG front month has increased by 9.1 % week on week to 26.50 EUR/MWh on colder January outlook. In addition, higher demand for LNG in Asia tightens LNG supply to Europe providing additional support for gas prices in front month. Low sulfur oil products has gained 2-2.9 % during last week, while fuel oil 3.5 front month has slightly dropped by 0.1 % to 274.70 USD/t. Low sulfur marine fuel oil (MFO 0.5) has increased by 2 % and closed at 355.68 USD/t, and MGO 0.1 has increased by 2.9 % week on week and closed at 406.85 USD/t.
FULL STORY

CHINA'S THE GLOBAL TIMES APPEARS TO CONFIRM A BAN ON AUSTRALIAN COAL IMPORTS AMID PERILOUS TRADE TENSIONS
Source: Anna Henderson, Stephen Dziedzic, James Oaten and Som Patidar (ABC News Aus)
Chinese state media appears to have confirmed that Beijing has blocked Australian coal imports, in a move which is likely to cost the economy billions of dollars and further inflame tensions between the two countries. Nationalistic state-owned tabloid The Global Times reports that China's top economic planner has approved power plants to import coal without clearance restrictions from several countries "except for Australia". Australian government sources say such media reports should be treated seriously because they are generally directly sanctioned by the Chinese Government.  FULL STORY

EMPTY CONTAINER REPOSITIONING ISSUES CONTINUE TO CREATE SHORTAGES
Source: Lee Hong Liang (Seatrade Maritime News)
The ongoing severe shortage of containers that is driving up freight rates is due mainly to logistical issues, not fleet underinvestment, according to shipping analyst Drewry. “Container shipping remains disrupted by box equipment shortages which are restricting available capacity and so forcing freight rates to record highs. However, this is being driven by empty container repositioning issues rather than inadequate fleet,” wrote Martin Dixon, director, head of research products, Drewry. In terms of supply, the global ocean-borne container equipment fleet is expected to end the year having declined 1.1% to 39.9m teu compared to a 3.3% projected fall in 2020 global …  FULL STORY

IRON ORE PRICE: HAVE THE BEARS GOT IT WRONG?
Source: Hellenic Shipping News
Commodity forecasting is a difficult business at the best of times. Even the most sophisticated “all-singing, all dancing” supply-demand model cannot account for a myriad of imponderables. These can include weather events and environmental factors, operational outages and disasters, government policy changes (especially in China)—and heavens above, a global pandemic. Granted, there is always a crystal ball element to price forecasting. But in the case of key steelmaking raw material iron ore, analysts, consultants and industry experts, and often market players themselves, have consistently got the price outlook wrong—typically on the low side. In fact, from practically the time your blogger started covering the iron ore and steel industry—from Shanghai in May 2008, the month of Fortescue Metals Group’s inaugural shipment…  FULL STORY

NEW MINE DEALS TO GROW PORT EXPORTS OUT OF GERALDTON
Source: Geoff Vivian (TheWest.com.au)
Geraldton Port’s annual exports are expected to surge by 1.5 million tonnes from existing mines and a further 2m tonnes now agreements have been signed with the owners of three new mines. In Geraldton yesterday, WA Ports Minister Alannah MacTiernan said jobs were being created in the region. “Every time that the port is putting through more tonnage, there’s more people coming into the region generally,” she said. Strandline Resources, GWR Group and Fenix Resources have signed port services agreements, with the WA Government expected to start a major growth spurt in the Mid West within two years. Fenix is expected to export 1.25m tonnes annually from its Iron Ridge iron ore projects…  FULL STORY

PORT SPENCER EYES POTENTIAL FOR HYDROGEN AS WELL AS GRAIN
Source: GrainCentral.com
PENINSULA Ports has paved the way for Port Spencer to be developed as a multi-commodity port with the acquisition of an extra 283 hectares of land. The company is now in discussions with parties about exporting commodities including hydrogen to supplement its grain income. Port Spencer is located on South Australia’s Eyre Peninsula, and has ruled out iron ore as a commodity it will handle due to the risk of contamination it poses to grain exports. Earlier this year, Peninsula Ports received a Public Environmental Report (PER) amendment, which removed the storage and export of iron ore from the project and allowed for the potential of other more suitable commodities to be managed alongside grain at the port.  FULL STORY

MELBOURNE PORT HAULAGE TAKING CONGESTION FINANCIAL HIT
Source: FullyLoaded.com.au
While Sydney container congestion heat has eased somewhat recently, the situation in Melbourne has flared in the lead-up to Christmas. Many of the issues are common between the cities’ ports, with the overflow from Sydney’s earlier problems, exacerbated by industrial action on the wharves, feeding into the Melbourne task as containership lines have sought to avoid the northern port. Now, in a detailed analysis of the problem, haulage body Container Transport Alliance Australia (CTAA) says Melbourne’s landside container logistics chain has reached critical congestion levels, driven by exceptionally strong import volumes and a backlog of empty containers not evacuated by shipping lines from the Port of Melbourne.  FULL STORY

AUSTRALIA'S AGL MAKES FINAL PUSH TO WIN APPROVAL FOR LNG IMPORT TERMINAL
Source: Sonali Paul (Reuters)
MELBOURNE, Dec 17 (Reuters) - Australia's AGL Energy Ltd AGL.AX on Thursday made a final bid for approval of a long delayed gas import terminal in the state of Victoria which it said would fill an expected shortfall in gas supply from 2024 and not damage the environment. AGL in 2016 was the first company to propose importing liquefied natural gas (LNG) to southeastern Australia, aiming for deliveries to start in 2021, but its plans were held up due to pressure from opponents for an extended environmental review. The review, which received more than 6,000 submissions, will send its recommendations in early 2021 to Victoria's planning minister, who is due to decide on the project in March.  FULL STORY

UPDATED: KEMBLA DERAILMENT FORCES REROUTING VIA SYDNEY
Source: Liz Wells (Grain Central)
DISCUSSIONS held in the wake of Tuesday’s derailment near Port Kembla point to the likelihood of the line being partially reopened from 4 January. This will involve one of the dual lines on the Moss Vale to Unanderra (MVA) rail path opening for a few hours overnight to carry grain trains heading down the Illawarra Escarpment to Port Kembla’s two grain terminals, and to Manildra Group’s Shoalhaven Starches plant. The MVU line will close during daylight hours to allow clean-up crews to operate safely until the site is cleared and the second line can be reopened.  FULL STORY

PORT OF NEWCASTLE COMMITS TO DIVERSIFICATION
Source: TrailerMag.com.au
The largest port on the East Coast of Australia has called for Expressions of Interest (EOI) for the supply of two mobile harbour cranes as part of a long-term diversification program. The EOI aligns with Port of Newcastle’s plans to invest in port capability that supports jobs and boosts the national economy. The announcement is part of a suite of key strategic development opportunities to support the future diversification of the Port, including the Newcastle Bulk Terminal (NBT), Maritime Precinct, Automotive and Automotive / Ro-Ro Hub. A separate project to install a new $35 million state-of-the-art ship unloader at the NBT – boosting safety, environmental compliance and efficiency in the handling of bulk products – is on track for completion in the second half of 2021.  FULL STORY

WHITEHAVEN BOLSTERS WINCHESTER SOUTH AMBITIONS
Source: Vanessa Zhou (Australian Mining)
Whitehaven Coal is anticipating a 50 per cent boost in production and processing capacity from the $980 million Winchester South coal project in Queensland. After updating a pre-feasibility study (PFS) for the project, Whitehaven is now targeting 15 million tonnes a year of run-of-mine coal over a mine life of more than 20 years. This includes the production of pulverised coal injection (PCI) and semi-hard coking coal (SHCC), which are used in the manufacture of steel, in addition to thermal coal exports. Whitehaven also declared maiden coal reserves of 350 million tonnes, and more than doubled its JORC resources from 530 million tonnes to 1.1 billion tonnes.  FULL STORY

AUSTRALIAN LNG EXPORTS HEAD IN 2020 TO RECORD OUTPUT
Source: Freight News (Hellenic Shipping News)
November was a strong month for Australian LNG exports, with 6.9 million tonnes (Mt) shipped, the highest since April this year. This was despite supply disruptions from Gorgon, Australia’s second largest project, and delays to the start-up of the Prelude floating LNG project. One of the reasons for the strong performance was record production from the east coast LNG projects at Gladstone. Taken together, the Gladstone projects exceeded nameplate capacity for the first time since exports commenced in January 2015. FULL STORY

CUSTOMS' COVID-19 REQUEST FOR CREW ARRIVING IN PORT TARANAKI LABELLED DISCRIMINATION
Source: Robin Martin (RNZ.co.nz)
Customs is asking that the crew of overseas vessels arriving at Port Taranaki carry evidence they have completed Covid-19 protocols and have health authority permission when they take shore leave. The move follows incidents in New Plymouth where the crew of the Hong Kong registered Yangtze Flourish were confronted by port staff and reported to police while out shopping. The Yangtze Flourish arrived in New Plymouth on 25 November with a cargo of palm kernel from Malaysia and its 22 crew were granted shore leave two days later after returning negative Covid-19 tests.  FULL STORY

REDUCTION IN WORKER HOURS FOLLOWING DEATHS CONTRIBUTING TO CARGO BACKLOG, PORT SAYS
Source: Kendall Hutt (Stuff.co.nz)
Ports of Auckland says a reduction in worker hours in the wake of two deaths is “absolutely” contributing to a container backlog. New Zealand’s ports have struggled to cope with congestion issues in the post Covid-19 period. Congestion has become so bad that some shipping lines have introduced a surcharge on cargo passing through Ports of Auckland, on top of shipping rates that are sometimes several times higher than usual. There are a number of reasons for the backlog, including a coronavirus-related delay in a major automation project at the port and a struggle to get the right staff to operate the port's eight cranes.  FULL STORY

AUCKLAND PORT MOVE: NORTHPORT STILL VIABLE DESPITE ABSENCE OF NZ FIRST – BACKER
Source: Denise Piper (Stuff.co.nz)
A proposal to move Ports of Auckland's operations to Whangārei remains viable, despite the move's main backers – NZ First – no longer being in Parliament, a businessman says. The spotlight is on Northport after it agreed to unload the container ship Constantinos P, instead of its Christmas cargo having to wait for weeks to get into the congested Ports of Auckland. The move sparked traffic safety and congestion fears for the road north of Auckland and served as a reminder of the need for a rail link to the port. But Kaitaia businessman Wayne Brown – who headed an inquiry into North Island cargo which supported Auckland port moving north – said it shows the market backs Northport.  FULL STORY

Whilst every effort has been made to ensure the accuracy of the information contained herein, Inchcape Shipping Services accepts no liability nor makes any representations or warranties of any kind, express or implied, as to its completeness, accuracy, reliability or suitability