News & Media

04 June, 2021

Australian Newsletter - Issue 681

SHIPPING’S “DIRTY FUEL” STAGES A COMEBACK AS EMISSIONS TARGETS LOOM
Source: Britt Russell Webster (SPGlobal.com)
"Dirty and unwanted" was how many market participants summarized the prospects for high sulphur fuel oil after IMO 2020 took effect, but more than a year on, this outlook has refused to materialize. Instead, scrubber washing technology has helped the shipping fuel find a niche within IMO 2020's framework, rescuing it from a quick demise. Analysts are now warning that the fuel may have an expiration date as the shipping industry moves towards tougher emissions targets, but there is little certainty over its remaining lifespan.  FULL STORY

CHINA TRIES TO BREAK ITS AUSTRALIAN IRON RELIANCE
Source: HellenicShippingNews.com
As the China-Australia trade war moves from product to product, ranging from barley to lobsters to wine, Beijing has so far refrained from imposing any ban or barrier on Australian iron ore. As global prices soar for the ore, China’s insatiable appetite and inability to find suitable substitutes are net-net insulating Australia from Beijing’s punitive intent. Australia supplies 53% of global demand for iron ore, of which China consumes 57%. According to the March edition of Resources and Energy Quarterly, Australia currently supplies 68% of China’s iron ore imports. Prices for the steelmaking commodity hit a record high of US$233 per tonne earlier this month, an uptrend that began last year but is now increasingly a reflection of growing global inflation fears and market concerns of Covid-caused supply disruptions in Brazil and elsewhere, the REQ report said.  FULL STORY

MEETING ON TOWNSVILLE PORT CHANNEL UPGRADE NEXT WEEK
Source: Eldin Ganic (DredgingToday.com)
The Port of Townsville said that the Independent Technical Advisory Committee (ITAC) will meet next week to discuss the Channel Upgrade Project. The public update will be held online on Wednesday, 9 June, from 1.30pm to 3pm. The ITAC members have diverse technical backgrounds and all are recognized in their fields of expertise. The ITAC is appointed, organized and supported by the Port of Townsville but Its deliberations and conclusions, however, are independent. The ITAC is comprised of an Independent Chair and technical / scientific specialists in numerous fields.  FULL STORY

CHINA’S STAKE IN AUSTRALIA’S LARGEST COAL EXPORT PORT QUESTIONED
Source: HellenicShippingNews.com
China’s stake in the Port of Newcastle has been questioned following recent changes to foreign investment laws. The port, which is the largest coal export port in the world, is operated by a company via a 98-year lease with the NSW government. That company is part-owned by the same Chinese state-owned corporation involved in Victoria’s Belt and Road Initiative — an agreement scrapped by the Morrison government in April after it cited the arrangements as inconsistent with foreign policy. Nationals Queensland senator Susan McDonald asked the government during Senate estimates on Tuesday whether the $1.75 billion lease sold by the NSW government in 2014 would still be approved today “given the geopolitical environment”.  FULL STORY

PORT OF NEWCASTLE DEAL – KEY FACTS
Source: MirageNews.com
In May 2021, NAB announced its role in the development of a loan for Port of Newcastle. This loan aligned financing for Australia’s largest east coast seaport with long-term environmentally and socially responsible outcomes. As Sustainable Finance Structuring Coordinator, NAB assisted in the development of both a sustainability-linked financing framework and green financing framework with Port of Newcastle. This transaction has been widely reported across domestic and global media. Due to the complexity of the refinancing arrangement, some reporting has contained factual inaccuracies.  FULL STORY

NSW THERMAL COAL CHARGES UP AS DEMAND RISES
Source: Nickolas Zackharia (AustralianMining.com.au)
Newcastle thermal coal futures have risen to their highest price since July 2018 at $US121.25 ($156.50) per tonne on Wednesday, off the back of increased demand for the commodity in Asia. The price rise marked a 93 per cent increase in the past year, closing at $US120.50 per tonne. The Australian Bureau of Statistics (ABS) last week recorded an 8 per cent increase to Australian coal exports in April 2021, which increased by $287 million. Coal exports to India led the charge, which rose by 167 per cent ($116 million) in April. “Australian coal exports to India have been steadily rising since mid-2020, following a substantial reduction in Chinese demand for Australian coal,” the ABS stated.  FULL STORY

GRAIN SHIP SETS SAIL WITH WA GRAIN ONBOARD
Source: FarmWeekly.com.au
THE first export vessel commissioned by SALIC Australia finished loading at Port Kembla's Quattro Ports on May 23 and has set sail for the Kingdom of Saudi Arabia. The 60,000 tonne cargo of wheat is the first of multiple bulk export cargos SALIC Australia has planned for this year. A SALIC Australia spokeswoman said the company's ground-breaking foray into the grain export market would generate a number of benefits for the Australian grains industry over the coming months and years. "Given its ongoing investments in Australian agricultural production and supply chain, more and more of Saudi Arabia's food requirements will be filled by Australian produce, which is ultimately good for prices and competition here in Australia," the spokeswoman said.  FULL STORY

IRON ORE MINERS TAKE DIG AT WA OVER 25PC PORT FEE HIKE
Source: Brad Thompson (AFR.com)
Iron ore heavyweights represented by the Port Hedland Industries Council have taken a swipe at the West Australian government over a move to milk close to $200 million a year out of the mining industry on top of a massive royalties windfall. The industries council, whose members include BHP, Fortescue Metals Group, Roy Hill and Mineral Resources, said it wasn’t consulted about a 25 per cent increase in export charges at Port Hedland. The government announced the fee hike on Monday, the same day WA Treasury released figures showing state revenue was up almost $3.7 billion year-on-year for the nine months to the end of March. Some $2.1 billion came from an increase in iron ore royalties as the benchmark price soared way above the $US96 a tonne assumed in the government’s financial forecasts.  FULL STORY  

PORT ISSUES WEIGH ON WEST AUSTRALIAN IRON ORE SHIPMENTS
Source: ArgusMedia.com
Port problems at Australian iron ore producers Rio Tinto and BHP moderated total shipments from the four largest iron ore producers in the Pilbara region of Western Australia (WA) in the week to 29 May. The four largest WA producers — Rio Tinto, BHP, Fortescue Metals and Roy Hill — loaded vessels with a combined total of 17.09mn deadweight tonnes (dwt) of capacity in the latest week, down from 17.93mn dwt in the week ending 22 May. Loadings were 1pc below the average of 17.25mn dwt/week over the past year, with Rio Tinto not shipping anything from its East Intercourse Island (EII) berths at Dampier and BHP experiencing problems at its Nelson Point terminal at Port Hedland.  FULL STORY 

SHIP'S CREW MEMBER POSITIVE IN PERTH PORT
Source: Aaron Bunch (VictorHarbourTimes.com.au)
A crew member from a ship docked at Western Australia's Fremantle Port has been placed in hotel quarantine after testing positive for coronavirus. WA Premier Mark McGowan wants the vessel to set sail before a flight carrying repatriated Australians arrives from India at Perth Airport on Wednesday. He says WA can't take more COVID-19 infected crew members from visiting ships as they risk overwhelming WA's quarantine facilities. The man in his 20s was placed into Perth hotel quarantine on Monday after he was tested for the virus at the Fiona Stanley Hospital. "He came off Sunday because he was unwell with symptoms that apparently weren't COVID-related," Mr McGowan told reporters on Tuesday.  FULL STORY

AUSTRALIA'S LONGEST EVER SHIPPING BAN ISSUED FOR 'UNBEARABLE' CONDITIONS AND 'SYSTEMIC' FAILURES
Source: Kelly Fuller (ABC.net.au)
Australian maritime authorities have banned a flag-of-convenience ship from Australian waters for 36 months for "unbearable" conditions and "systemic" failures. The Australian Maritime Safety Authority (AMSA) detained the Panama-flagged bulk carrier MV Maryam on February 19. The Qatari-owned vessel was docked at Port Kembla for 36 safety and crew welfare deficiencies. After speaking to the ship's captain and crew, AMSA inspectors found the owner, Aswan Shipping had failed to pay key contracts, leaving the ship without fuel for the engine, power and lighting.  FULL STORY

NZ APPLES GRAPPLE WITH SHIPPING ISSUES
Source: John Hey (FruitNet.com)
Lack of containers and shipping services causing uneven supply to export markets.
New Zealand’s apple industry is facing “unprecedented” challenges with shipping its fruit to export markets. Fresh produce exporters all over the world are currently grappling with Covid-related shipping issues, including reefer container shortages, port congestion, and reduced or disrupted services from shipping lines. The challenges have been compounded for New Zealand apple shippers, who are vying with other industries such as meat and seafood for limited freight space and services in a market where global consolidation has reduced the number of shipping lines servicing the country.  FULL STORY

NEW ZEALAND’S FORESTRY PRODUCT EXPORT PRICES ROSE 7%
Source: Lesprom.com
New Zealand’s prices for oil and logs rose sharply in the March 2021 quarter, while import and export prices continued to fall overall, Stats NZ said. Overseas trade index (OTI) import and export prices both fell 0.8% in the quarter to March 2021. Prices remained well below those recorded a year ago, with annual falls of 6.3% for imports and 7.2% for exports. Terms of trade rose 0.1% in the March 2021 quarter but remained down 0.9% annually. The terms of trade measures the purchasing power of New Zealand’s exports abroad and is an indicator of the overall state of the economy. A rise in the terms of trade means New Zealand can buy more imports for the same amount of exports.  FULL STORY 

LOCAL FOCUS: TSUNAMI LOG THREAT TO NAPIER AFTER EARTHQUAKE
Source: Patrick O’Sullivan (NZHerald.com.nz)
It could take as little as 20 minutes for a tsunami to hit Napier after an earthquake. And with Napier Port stacked with logs and containers, water alone may be the least of the city's worries. A tsunami could sweep many thousands of logs and containers across the region, significantly hampering rescue and recovery efforts. A very large earthquake poses an extreme theat of Tsunami to Hawke's Bay, with tectonic plates colliding deep in the Hikurangi Trench offshore. A study in Gisborne highlighted the threat of logs to the city if a large tsunami was to strike. Gisborne is not a container port. Napier Port's senior communications advisor Chris Lonergan said its primary focus was the safety and wellbeing of people working on the port.  FULL STORY

3,000 SHIPPING CONTAINERS FELL INTO THE PACIFIC OCEAN LAST WINTER
Source: Tim Lydon (Salon.com)
A rise in container-ship accidents adds to the growing marine plastic pollution problem. You're right if you think you've been hearing a lot about container ships lately. One off the coast of Sri Lanka that was carrying 25 tons of nitric acid and other cargo suffered an explosion after containers caught fire on May 20 and burned for more than a week, littering the beaches with plastic pollution. And in March all eyes were on the Suez Canal, where a 1,300-foot-long container ship turned sideways and gummed up international trade with a six-day-long traffic jam. Maybe you've also had your shoes, bike or other online purchases delayed because of backed-up ports near Los Angeles.  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.