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Bunker Fuel

JLC China Bunker Market Monthly Report (April 2024)

China saw a drop in its bonded bunker fuel sales in April as it sold about 1.63 million mt of bonded bunker fuel due lower production and a severe shortage of barge capacity at ports, says Beijing-based JLC.

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Beijing-based commodity market information provider JLC Network Technology Co. recently shared its JLC China Bunker monthly report for April 2024 with Manifold Times through an exclusive arrangement:

Bunker Fuel Demand

China’s bonded bunker fuel sales drop in April

China saw a drop in its bonded bunker fuel sales in April, because of lower production and a severe shortage of barge capacity at ports.

The country sold about 1.63 million mt of bonded bunker fuel in the month, with the daily sales down by 7.48% month on month to 54,270 mt, JLC’s data shows.

Bonded bunker fuel sales by Chimbusco and Sinopec (Zhoushan) respectively dropped to 490,000 mt and 580,000 mt in April, while those by suppliers with regional bunkering licenses fell to 468,100 mt. At the same time, SinoBunker and China Changjiang Bunker (Sinopec) settled at 6,000 mt and 3,000 mt, without change from March, the data shows.

China’s LSFO supply tightened in April when refineries’ unit maintenance peaked, leading to a fall in the country’s bonded bunker fuel sales. Meanwhile, Chinese customs strengthened the supervision of bunker barges, dampening ports’ bunkering business to some extent.

China’s bonded bunker fuel exports grow in March

China’s bonded bunker fuel exports grew in March, as domestic refiners boosted low-sulfur fuel oil (LSFO) production and relatively low LSFO prices attracted more shipowners.

The country exported 1.41 million mt of bonded bunker fuel in the month, climbing by 13.38% from a month earlier, with the daily exports up 6.06% to 45,555 mt, JLC estimated, with reference to data from the General Administration of Customs of the PRC (GACC).

Heavy bunker fuel exports amounted to about 1.32 million mt, accounting for 93.13% of the country’s total, while light bunker fuel exports settled at 97,000 mt, accounting for 6.87%.

Chinese refiners expanded their bonded bunker fuel exports when domestic supply increased amid larger LSFO production. China’s LSFO output rose to about 1.40 million mt in March, with the daily output growing by 5.41% month on month to 45,000 mt, JLC’s data shows.

Meanwhile, LSFO prices at Chinese ports were more competitive than those in Singapore and neighbouring regions, attracting more shipowners to refuel in China, especially in Shanghai and Zhoushan.

However, on a year-on-year comparison, China’s bonded bunker fuel exports plunged by 31.70% in March.

In the first three months of this year, China’s bonded bunker fuel exports totaled 4.44 million mt, a fall of 11.27% from the same months in 2023. Heavy bunker fuel exports settled at 4.16 million mt in the period, accounting for 93.81%, while light bunker fuel exports settled at 274,500 mt, accounting for 6.19%.

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Domestic-trade bunker fuel demand shrinks in April

Domestic-trade bunker fuel demand shrank in April, as shipowners were still hesitant to make deals and new orders were limited when terminal demand for cargo transportation stayed relatively weak.

Domestic-trade heavy bunker fuel demand came in at 420,000 mt in the month, down by 10,000 mt or 2.33% month on month, JLC’s data indicates.

In the meantime, domestic-trade light bunker fuel demand was 130,000 mt, down by 10,000 mt or 7.14% from a month earlier. Shipowners with a wait-and-see attitude just based purchases on rigid demand.

Bunker Fuel Supply

China’s bonded bunker fuel imports extend surges in March

China’s bonded bunker fuel imports extended surges in March, as freight rates for imported cargoes decreased and high-sulfur fuel oil (HSFO) demand from Zhoushan grew.

The country imported about 383,300 mt of bonded bunker fuel in the month, surging by 72.11% from the previous month and 118.28% from a year earlier, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

HSFO demand from Zhoushan Port was growing amid the expansion of its high-sulfur bunkering business, coupled with a decline in freight rates for imported cargoes, pushing up China’s bonded HSFO imports.

China did not import any bonded low-sulfur fuel oil (LSFO) as the economic efficiency for import was still relatively low. Delivered-to-vessel prices and premiums of LSFO at the ports in East China dropped, as domestic LSFO supply increased on larger production.

Malaysia surpassed Russia to become the largest supplier in March, exporting 179,600 mt of bonded bunker fuel to China which accounted for 46.85% of China’s total imports. Russia slipped to the second place with 162,600 mt, accounting for 42.43%, followed by South Korea with 41,100 mt, accounting for 10.72%.

China’s bonded bunker fuel imports totaled about 965,200 mt in the first quarter of this year, a dramatic rise of 52.60% from the same quarter in 2023.

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Domestic-trade heavy bunker fuel supply tightens in April

Domestic-trade heavy bunker fuel supply tightened in April, as blenders’ blending interest was limited by decreasing availability of low-sulfur residual oil and the cargo delivery was not smooth.

Chinese blenders supplied about 430,000 mt of heavy bunker fuel in the month, a loss of 30,000 mt or 6.52% from March, JLC’s data shows.

At the same time, domestic-trade MGO supply was estimated at 160,000 mt, stable month on month, the data shows. Refineries’ enthusiasm for MGO production was relatively fair in April.

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Bunker Prices,Profits

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Yvette Luo
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Sales (Beijing)
Tony Tang
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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.

All rights reserved. No portion of this publication may be photocopied, reproduced, retransmitted, put into a computer system or otherwise redistributed without prior authorization from JLC.

Related: JLC China Bunker Market Monthly Report (March 2024)
Related: JLC China Bunker Fuel Market Monthly Report (February 2024)
Related: JLC China Bunker Market Monthly Report (January 2024)

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 earlier periods are available here.

 

Photo credit: JLC Network Technology
Published: 13 May 2024

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Business

Singapore: Sing Fuels appoints Sanket Naik as Managing Director

Sanket joined Sing Fuels in 2016 as a Credit Manager and has ‘immersed himself’ in all departments; will drive company to expand into areas like sustainability and biofuels.

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Singapore: Sing Fuels appoints Sanket Naik as Managing Director

Singapore-based provider of marine fuel solutions Sing Fuels on Saturday (7 December) said Sanket Naik, was recently promoted to Managing Director of Sing Fuels. 

The firm said Sanket joined Sing Fuels in 2016 as a Credit Manager. 

“He immersed himself across all departments, ranging from investment to business development, gaining a 360-degree understanding of the business and serving as a key driver of growth and success at Sing Fuels,” Sing Fuels said in a social media post. 

“As Managing Director, Sanket is poised to drive Sing Fuels 3.0, expanding into areas like sustainability and biofuels, ensuring we stay at the forefront of industry innovation.”

 

Photo credit: Sing Fuels
Published: 9 December, 2024

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Legal

Vietnam: Two vessels seized over 31,000 litres of illegal diesel oil

Vietnam Coast Guard said vessels were transporting various quantities of oil material: “HP-3790” was transporting about 16,000 litres and “Phuong Nam 68” transported about 15,000 liters.

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The Vietnam Coast Guard on Thursday (5 December) said it detained vessel HP-3790 in the sea bordering Hai Phong City and Quang Ninh Province. 

The Coast Guard discovered the ship at 2pm on 4 December displaying several suspicious signs and ordered the vessel to stop for administrative inspections.

The authority proceeded to inspect the vessel, which had three crew members on board, and found it to be transporting about 16,000 litres of diesel oil with no invoices or documents proving its legal origin.

HP 3790

The Coast Guard also detained another ship, Phuong Nam 68, that also had three crew members on board at 10am on 5 December. 

The ship was transporting about 15,000 liters of DO oil with no invoices or documents proving its legal origin.

As such, the ships were handed over to the Command of Coast Guard Region 1 for further investigation and handling in accordance with the provisions of law.

 

Photo credit: Vietnam Coast Guard
Published: 9 December, 2024

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Alternative Fuels

DNV: Use of ammonia as a bunker fuel among highlights in IMO MSC 109

Amendments to the IGC Code to enable the use of ammonia cargo as fuel were adopted and interim guidelines for the general use of ammonia as fuel were approved during session.

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Classification society DNV on Saturday (7 December) shared a statutory news article that provides a summary of the 109th session of the International Maritime Organization’s (IMO) Maritime Safety Committee (MSC 109) including adopted amendments to the IGC Code to enable the use of ammonia cargo as fuel and approved draft interim guidelines for ammonia as a marine fuel.

The following is an excerpt from the news update relating to bunker fuels:

The 109th session of the IMO’s Maritime Safety Committee (MSC 109) was held from 2 to 6 December 2024. Amendments to the IGC Code to enable the use of ammonia cargo as fuel were adopted, and interim guidelines for the general use of ammonia as fuel were approved. The IGF Code was amended to improve the safety of ships using natural gas as fuel. MSC 109 further approved draft SOLAS amendments to enhance the safety of pilot transfer arrangements and progress was made on the new safety code for Maritime Autonomous Surface Ships.

Meeting highlights

  • Adopted amendments to the IGC Code to enable the use of ammonia cargo as fuel
  • Adopted amendments to the IGF Code for ships using natural gas as fuel
  • Approved draft interim guidelines for ammonia as fuel
  • Approved draft amendments to SOLAS Regulation V/23 and the related performance standards to improve the safety of pilot transfer arrangements
  • Advanced the non-mandatory Code on Maritime Autono- mous Surface Ships (MASS)

Amendments to mandatory instruments 

Ammonia cargo as fuel (IGC Code) MSC 109 adopted amendments to Paragraph 16.9.2 of the International Code for the Construction and Equipment of Ships Carrying Liquefied Gases in Bulk (IGC Code) to enable the use of ammonia as fuel on ammonia carriers.

An MSC circular to encourage the voluntary early implementation of the amendments to Chapter 16 was approved. 

The amendments will enter into force on 1 July 2026.

Safety of ships using natural gas as fuel (IGF Code)

MSC 109 adopted amendments to the International Code of Safety for Ships Using Gases or Other Low-flashpoint Fuels (IGF Code), based on experience with the code since its entry into force in 2017.

The amendments include:

  • Clarified application provisions
  • Alignment with the IGC Code on suction wells for fuel tanks extending below the lowermost boundary of the tank
  • Alignment with the IGC Code on discharge from pressure relief valves to discharge to tanks under certain conditions
  • Clarified requirements to fire insulation for deck structures in relation to fuel tanks on open deck
  • Clarified requirements for hazardous ducts through non-hazardous spaces and vice versa
  • Updated requirements for the hazardous zone radius for fuel tank vent mast outlets, increasing to 6 metres for zone 1 and 4 metres for zone 2

The amendments will enter into force on 1 January 2028.

Goal-based new ship construction standards

Goal-based standards (GBS) for the new construction of bulk carriers and oil tankers are, conceptually, the IMO’s rules for class rules. Under the GBS, IMO auditors use guidelines to verify the construction rules for bulk carriers and oil tankers of class societies acting as Recognized Organizations (Resolution MSC.454(100)).

Initial GBS verification of Biro Klasifikasi Indonesia (BKI) BKI has requested GBS verification of their ship construction rules for bulk carries and oil tankers. MSC 109 agreed that the BKI rules comply with the GBS, provided non-conformities and observations are rectified and verified in a new audit.

North Atlantic wave data (IACS Recommendation No. 34, Revision 2) MSC 109 noted that IACS is currently undertaking a review of its Common Structural Rules (CSR) for bulk carriers and oil

tankers to reflect advances in data, materials, technologies and calculation methodologies. The CSR are implemented in the individual class rules of the IACS members, which are subject to compliance with the GBS.

MSC 109 further noted that IACS has now issued a revision of the North Atlantic wave data to ensure more scientific data as a basis for the rule formulas in the CSR. The new scatter diagram in Revision 2 of IACS Recommendation No. 34 shows the probability of occurrence of different sea states and is based on wave data from advanced hindcast wave models combined with ships’ AIS data for all SOLAS vessels in the period from 2013 to 2020.

MSC 109 agreed that an observation from the initial CSR audit in 2015, that the scatter diagram in Revision 1 of IACS Recommendation No. 34 was based on past statistics, was now considered addressed.

MSC 109 further invited IACS to provide more information about the assumptions, modelling and technical background for Revision 2 of IACS Recommendation No. 34, and agreed that the GBS audit of the revision to follow should be carried out in conjunction with the consequential rule changes in the CSR.

New technologies and alternative fuels 

Identification of gaps in current IMO instruments MSC 109 continued its consideration of potential alternative fuels and new technologies to support the reduction of GHG emissions from ships from a safety perspective. The intention is to identify safety obstacles, barriers and gaps in the current IMO instruments that may impede the use of the various alter- native fuels and new technologies.

MSC 109 agreed to add “swappable traction lithium-ion battery containers” to the list of alternative fuels and new technologies. The list already includes fuels and technologies such as ammonia, hydrogen, fuel cell power installations, nuclear power, solar power, wind power, lithium-ion batteries and supercapacitor energy storage technology.

Recommendations to address each of the identified barriers and gaps in the IMO regulatory framework will be considered in a Correspondence Group until MSC 110 (June 2025). Application of the IGF Code

MSC 109 agreed on draft amendments to SOLAS to clarify that the IGF Code applies to ships using gaseous fuels, whether they are low-flashpoint or not. The term “gaseous fuels” was added to the definitions in SOLAS Regulation II-1/2 and to the application provisions of SOLAS Regulations II-1/56 and 57.

The draft amendments are expected to enter into force on 1 January 2027, subject to adoption by MSC 110 (June 2025).

Carriage of cargoes and containers

Ammonia as fuel

MSC 109 approved draft interim guidelines for the safety of ships using ammonia as fuel.

Ships carrying liquefied gases in bulk (IGC Code)

MSC approved draft amendments to the IGC Code to incorporate the large number of Unified Interpretations developed since the latest major review of the code, which entered into force in 2016. The primary objective of the draft amendments is to remove ambiguity and promote the consistent implementation of the IGC Code requirements.

 

Photo credit: CHUTTERSNAP on Unsplash
Published: 9 December, 2024

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