Bunker Fuel

JLC China Bunker Fuel Market Monthly Report (September 2023)

Country sold approximately 1.67 million mt of bonded bunker fuel in the month, with the daily sales decreasing by 4.23% to 55,610 mt from August, JLC’s data shows.

Published

11 months ago

October 13, 2023

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Beijing-based commodity market information provider JLC Network Technology Co. recently shared its JLC China Bunker monthly report for September 2023 with Manifold Times through an exclusive arrangement:

Bunker Fuel Demand

China’s bonded bunker fuel sales retreat in September

China saw a drop in its bonded bunker fuel sales in September, due to tightening supply and some policy factors.

The country sold approximately 1.67 million mt of bonded bunker fuel in the month, with the daily sales decreasing by 4.23% to 55,610 mt from August, JLC’s data shows. The sales by Chimbusco, Sinopec Zhoushan, SinoBunker and China ChangJiang Bunker (Sinopec) were respectively 550,000 mt, 620,000 mt, 75,000 mt and 35,000 mt, while those by suppliers with regional bunkering licenses dropped to 388,300 mt.

Despite relatively stable shipping demand, China’s bonded bunker fuel sales fell back amid tightening supply. Meanwhile, the barging capacity at ports in Shenzhen, Guangzhou and Xiamen became inadequate, adding to the downward pressure on the sales.

China’s bonded bunker fuel exports rally in August

China’s bonded bunker fuel exports rallied modestly in August, mainly due to a slight increase in domestic fuel oil output.

The country exported roughly 1.63 million mt of bonded bunker fuel in the month, inching up by 0.84% month on month, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

Among these exports were 1.55 million mt of heavy bunker fuel and 79,600 mt of light bunker fuel, which accounted for 95.12% and 4.88% of the total, respectively.

Enterprises with national bunkering licenses exported about 1.17 million mt of bonded bunker fuel in the month, accounting for 71.99% of the country’s total, with Sinopec Fuel Oil and Chimbusco taking 64.35%. Meanwhile, suppliers with regional licenses exported 456,600 mt, occupying 28.01%, with PetroChina Fuel Oil (Zhoushan, Shanghai, Guangzhou and Shenzhen) supplying 234,600 mt, accounting for 14.39% of China’s exports and 51.38% of regional enterprises’ total.

Larger bonded bunker fuel exports were ascribed to faster fuel oil production. China’s daily fuel oil output settled at 146,839 mt in August, a boost of 3.31% month on month, according to data from the National Bureau of Statics (NBS). Meanwhile, bunkering business at Chinese ports recovered to some degree when typhoons weakened, which also lent some support to the exports.

Capping the upside, however, some refiners and traders ran short of quotas on low-sulfur fuel oil (LSFO) exports.

On a year-on-year comparison, China’s bonded bunker fuel exports plunged by 19.65% in August. Underlying the slump was a relatively high base in August 2022 when refiners hiked exports sharply amid new quotas.

China recorded a total of 13.66 million mt of bonded bunker fuel exports in the first eight months of this year, growing by 2.42% from the corresponding months in 2022, decelerating from a boost of 6.38% in January-July.

Heavy bunker fuel exports totaled 12.97 million mt in the eight months, making up 94.97%, while marine gas oil exports amounted to 687,400 mt, accounting for 5.03%. Enterprises with national bunkering licenses tallied about 10.97 million mt of bonded bunker fuel exports in this period, accounting for 80.32%, while those with regional licenses exported 2.69 million mt, nearly one fifth of the country’s total exports.

Domestic-trade bunker fuel demand rises in September

Domestic-trade bunker fuel demand rose in September, amid lingering bullish sentiment and pre-holiday restocking.

Domestic-trade heavy bunker fuel demand climbed to 360,000 mt in the month, an increase of 30,000 mt or 9.09% from August, JLC’s data shows. In the meantime, domestic-trade light bunker fuel demand rose to 140,000 mt, up by 10,000 mt or 7.69% from the previous month.

Though downstream buyers increased purchases to meet rigid demand, their acceptance of high prices was still limited.

Bunker Fuel Supply

China sees a drop in its August bonded bunker fuel imports

China’s bonded bunker fuel imports dropped in August, as import costs surged and domestic fuel oil production sped up.

The country imported approximately 306,500 mt of bonded bunker fuel in the month, a cut of 8.23% from the previous month and 8.48% from a year earlier, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

South Korea became the largest supplier to China by exporting about 111,600 mt of bonded bunker fuel, accounting for 36.4% of the latter’s total imports. Oman ranked second with 100,600 mt, accounting for 32.8%, while Russia slipped to the third place with 91,300 mt, making up 29.8%. There were also 3,000 mt of bonded bunker fuel coming from Singapore, occupying 1.0%.

Domestic importers showed lower buying interest, as high-sulfur bunker fuel prices in Asia soared amid surging international crude and imported low-sulfur bunker fuel prices still lacked price advantages. Meanwhile, freight rates for imported cargoes stayed firm, adding to the downward pressure on the imports.

The drop in the imports was also because of larger domestic production. Chinese refiners raised their daily fuel oil output to 146,839 mt in August, an increase of 3.31% month on month, according to data from the National Bureau of Statics (NBS).

China’s bonded bunker fuel imports totaled about 2.49 million mt in January-August, diving by 20.58% from the same months in 2022, slowing down from a plunge of 22.02% in January-July.

Chinese blenders supply more domestic-trade heavy bunker fuel in Sept

Chinese blenders supplied more domestic-trade heavy bunker fuel in September, as they raised output when refineries increased low-sulfur residual oil supply. Meanwhile, terminal buyers placed more orders for bunker fuel towards the public holiday for the Mid-Autumn Festival and the National Day.

Chinese blenders supplied about 390,000 mt of domestic-trade heavy bunker fuel in the month, a boost of 20,000 mt or 5.41% from August, JLC’s data shows.

On the contrary, domestic-trade marine gas oil (MGO) supply dropped to 160,000 mt, a cut of 10,000 mt or 5.88% month on month. Coking margins were squeezed by rising feedstock prices, forcing refineries to reduce their light bunker fuel supply.

Editor
Yvette Luo
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Sales (Beijing)
Tony Tang
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Sales (Singapore)
Ginny Teo
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JLC Network Technology Co., Ltd is recognized as the leading information provider in China. We specialized in providing the transparent, high-value, authoritative market intelligence and professional analysis in commodity market. Our expertise covers oil, gas, coal, chemical, plastic, rubber, fertilizer and metal industry, etc.

JLC China Bunker Fuel Market Monthly Report is published by JLC Network Technology Co., Ltd every month on China bunker market, demand, supply, margin, freight index, forecast and so on. The report provides full-scale & concise insight into China bunker oil market.

Note: China-based commodity market information provider JLC Technology has been providing Singapore bunkering publication Manifold Times China bunker volume data since 2020. Data from that period is available here.

Photo credit: JLC Network Technology
Published: 13 October, 2023

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BV VeriFuel participates in first LNG bunkering operation in Shanghai

VeriFuel, Bureau Veritas’ Marine Fuel Services programme designed to facilitate future developments of the marine fuel industry, successfully participated in its first LNG bunkering operation in Shanghai.

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BV VeriFuel participates in first LNG bunkering operation in Shanghai

VeriFuel, Bureau Veritas' Marine Fuel Services programme designed to facilitate the future developments of the marine fuel industry, last week celebrated a milestone in LNG bunkering in Shanghai.

VeriFuel successfully participated in its first LNG bunkering operation about two weeks ago in Shanghai.

“This marks a significant step forward as we expand our service offerings to meet the growing demand for sustainable fuel solutions,” it said in a social media post.

“With more deliveries already on the way, our new service line is ready to support your LNG bunkering needs. We look forward to partnering with you on this exciting journey towards a more sustainable future.”

According to Bureau Veritas, VeriFuel provides the latest technology in order to monitor global marine fuel activities.

In 50 countries, VeriFuel provides the inspection services that are performed by in-house bunker surveyors based on uniform procedures and reporting.

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Published: 10 September, 2024

Methanol

Methanex to acquire OCI Global international methanol business

Transaction includes OCI’s interest in two methanol facilities in Beaumont, Texas, a low-carbon methanol production and marketing business and a currently idled methanol facility in Netherlands.

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Methanex to acquire OCI Global international methanol business

Methanex Corporation (Methanex) on Sunday (8 September) announced that it has entered into a definitive agreement to acquire OCI Global’s (OCI) international methanol business for USD 2.05 billion.

The transaction includes OCI’s interest in two world-scale methanol facilities in Beaumont, Texas, one of which also produces ammonia. The transaction also includes a low-carbon methanol production and marketing business and a currently idled methanol facility in the Netherlands.

“This is a unique opportunity to create value by acquiring two highly attractive North American methanol assets that will further strengthen our global production base and we expect it will be immediately accretive to free cash flow per share,” said Rich Sumner, President and Chief Executive Officer of Methanex.

“The Beaumont plants benefit from access to North America’s abundant and favourably-priced supply of natural gas feedstock, and are expected to increase our global methanol production by over 20 percent.”

“We believe the transaction will provide significant long-term value to Methanex shareholders while aligning with our strategic objectives of industry leadership, operational excellence, and financial resiliency,” said Mr. Sumner.

“From an operating perspective, we have a shared culture of safety and operational excellence, and we expect the OCI team will help us build new skills in ammonia while enhancing our capabilities in the evolving business of low carbon methanol production and marketing.”

Nassef Sawiris, Executive Chairman of OCI, added, “We are pleased with the opportunity to achieve a significant ownership position and are highly confident in Methanex’s ability to create enduring value for shareholders. As the global leader committed to safety and operational excellence, we identified Methanex as the natural owner of OCI Methanol at the outset of our strategic process, which we initiated in the spring of 2023.”

As part of the transaction, Methanex will acquire the following:

A methanol facility in Beaumont, Texas with an annual production capacity of 910,000 tonnes of methanol and 340,000 tonnes of ammonia. This plant was restarted in 2011 and since that time the plant has been upgraded with USD 800 million of capital for full site refurbishment and debottlenecking.
A 50 percent interest in a second methanol facility also in Beaumont, Texas, operated by the joint venture Natgasoline LLC (Natgasoline). The Natgasoline plant was commissioned in 2018 and has an annual capacity of 1.7 million tonnes of methanol, of which Methanex’s share will be 850,000 tonnes.
OCI HyFuels, which produces low-carbon methanol and sells industry-leading volumes with trading and distribution capabilities for renewable natural gas (RNG). With nine years of experience in the low-carbon methanol business and with an array of blue-chip customers, this will enhance Methanex’s existing Low Carbon Solutions function with additional expertise in this developing segment.
A methanol facility in Delfzijl, Netherlands with an annual capacity to produce 1 million tonnes of methanol. This facility is not currently in production due to unfavourable pricing for natural gas feedstock.

Closing of the transaction is expected in the first half of 2025. The transaction has been approved by the boards of directors of both companies and is subject to receipt of certain regulatory approvals and other closing conditions including TSX approval for the issuance of Methanex shares to OCI.

The transaction is also subject to approval by a simple majority of the shareholders of OCI. The largest shareholder of OCI, has signed an agreement to vote for the transaction.

Photo credit: OCI Global
Published: 10 September, 2024

Alternative Fuels

Corvus Energy gas-safe marine fuel cell system receives type approval by DNV

Firm said the system is the first Fuel Cell System designed to be inherently gas-safe, making it the safest fuel cell system in the market.

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Corvus Energy gas-safe marine fuel cell system receives type approval by DNV

Corvus Energy, supplier of energy storage systems (ESS) for maritime applications, on Wednesday (4 September) announced that the Corvus Pelican Fuel Cell System has received Type Approval from classification society DNV.

The system, which was developed through the three-year-long H2NOR project, is the first Fuel Cell System (FCS) designed to be inherently gas-safe, making it the safest fuel cell system in the market.

Corvus Energy said receiving type approval from DNV confirmed that the Corvus Pelican Fuel Cell System meets the most stringent performance and safety standards required by the maritime industry.

Olaf Drews, Head of Engines & Pressurized Equipment Maritime, said: “It is a special fuel cell system, because the Pelican uses nitrogen for inerting of the fuel cell space.”

“It is the first fuel cell system that uses this technology and this brings it to a very preferred safety level. This is a milestone, and we look forward to the first ship project.”

Despite technology improvements and advancements in battery electric vessels, most vessels cannot achieve zero-emission operations for extended periods of time using batteries alone. For vessels on longer routes and vessels that are unable to charge often enough, we need to add clean fuel and fuel cells to enable extended zero-emission capabilities.

CEO of Corvus Energy, Fredrik Witte, said: “Toyota’s unsurpassed knowledge in developing high-quality and efficient fuel cells, in addition to the strong collaboration and high level of maritime experience among the partners in this development project, has been key.”

“This is a milestone for net zero shipping. We now have a high-quality range extender to add to our existing ESS portfolio with the scalability and the safety needed to be a real driver in the future of marine decarbonization.”

The first Corvus Pelican Fuel Cell System is produced and ready to be installed onboard MS Skulebas, a 35-meter fishing and training vessel owned by Vestland County and operated by Måløy Upper Secondary School in Norway.

The vessel already has a 1 MWh battery system onboard. By adding the Corvus Pelican Fuel Cell System and hydrogen storage, the vessel will be able to operate for four days on zero emission.

Photo credit: Corvus Energy
Published: 10 September, 2024