Business

JLC China Bunker Market Monthly Report (August 2022)

China’s bonded bunker fuel sales continued to rise in August as bonded bunker fuel demand improved and supply from Zhoushan and Shanghai grew, JLC data showed.

Published

2 years ago

September 12, 2022

Admin

Beijing-based commodity market information provider JLC Network Technology Co. recently shared its JLC China Bunker monthly report for August 2022 with Manifold Times through an exclusive arrangement:

Bunker Fuel Demand

Bonded bunker fuel sales rise on more demand in Aug

China’s bonded bunker fuel sales continued to rise in August, as bonded bunker fuel demand improved and the supply from Zhoushan and Shanghai grew when local spread of the virus slowed down.

The country’s bonded bunker fuel sales climbed to around 1.80 mln mt in the month, up by 7.14% from a month earlier, JLC’s data shows. In detail, Chimbusco and Sinopec Zhoushan sold about 670,000 mt and 745,000 mt of bonded bunker fuel in August, JLC’s data indicates. Bonded bunker fuel sales by SinoBunker and China ChangJiang Bunker (Sinopec) were about 80,000 mt and 60,000 mt, respectively. About 245,000mt of bonded bunker fuel sales were made by suppliers who held local licenses, with PetroChina Zhoushantaking 110,800 mt.

China saw higher monthly growth in bonded bunker fuel exports in July, as the country continued to ramp upits production of low-sulfur fuel oil (LSFO, with the maximum sulfur content at 0.5%) amid new quota and substantial margins.

China recorded approximately 1.69 million mt of bonded bunker fuel exports in July 2022, jumping 12.06% month on month, according to data from the General Administration of Customs of PRC (GACC).

The exports of heavy bunker fuel and light marine gas oil were about 1.60 million mt and 99,900 mt in the month, respectively occupying 94.1% and 5.9% of the total.

State-owned enterprises exported roughly 1.45 million mt of bonded bunker fuel over the month, making up 85.44%, while the exports by local independent enterprises rose to 246,700 mt, accounting for 14.56%.

On a year-on-year comparison, however, the bonded bunker fuel exports declined by 9.44%in July, GACC data indicates. The drop came as supply tightened after China’s imports of bonded bunker fuel plunged amid high costs and the bonded bunker fuel market was still depressed by the epidemic.

JLC China Bunker Market Monthly Report (August 2022)

Domestic bunker fuel demand stabilizes in August

Domestic-trade heavy bunker fuel demand stabilized at 400,000 mt in August, as the consumption in the shipping market was relatively steady. The majority of market participants stood on the fence when bunker fuel prices remained high, resulting in light trading and limited new contracts. On the other hand, the demand for light bunker fuel ascended by 10,000 mt or 6.67% to roughly 160,000 mt in the month. Despite downward pressure from high temperatures and rising diesel prices, the demand for light bunker fuel was still supported by rigid demand.

Bunker Fuel Supply

China records steep fall in bonded bunker fuel imports

China’s bonded bunker fuel imports sharply slumped in July, amid a surge in the output of low-sulfur fuel oil (LSFO) and a decline in domestic bunker fuel prices.

The country imported about 352,600 mt of bonded bunker fuel in July 2022, a plunge of 31.85% month on month and 21.24% year on year, according to the data from the General Administration of Customs of PRC(GACC).

Encouraged by the release of this year’s third batch of LSFO export quota and still good margins, Chinaramped up its production of LSFO during the month, relieving the ongoing supply tension to some extent. As a result, the country slashed its bonded bunker fuel imports when the booming production managed to meet more domestic demand.

In addition, China’s bunker fuel prices kept sliding over the month, making domestic bunker fuel prices more competitive. At the same time, certain market participants who were pessimistic about imported LSFO prices reduced their procurement of imported low-sulfur resources because they thought that prices would continue to dip in the short run.

Despite a smaller share of the imports from Malaysia, the country still led all suppliers by exporting 83,400 mt of bonded bunker fuel to China, accounting for 24% of China’s total imports of bonded bunker fuel. Japan overtook the UAE and ranked second with the imports from it at 79,200 mt and accounting for 22%. The followings were Russia, South Korea and the UAE, with 77,900 mt from Russia, 69,000 mt fromSouth Korea and 42,100 mt from the UAE, accounting for 22%, 20% and 12% respectively. There were only 1,000 mt of bonded bunker fuel imports coming from Singapore in the month.

Domestic blended bunker fuel supply creeps up in August

Domestic blended bunker fuel supply increased in August, as blending margins were relatively good in the month, underpinned by higher bunker fuel prices.

Chinese blenders supplied a total of about 480,000 mt of heavy bunker fuel in August 2022, an uplift of 30,000 mt or 6.67% from a month earlier, JLC’s data shows.

In detail, the supply of low-sulfur asphalt, an important blendstock for heavy bunker fuel, increased in the month as blenders were keen to make purchases. However, the supply was inadequate in some regions, including Sichuan, due to the power rationing. The supply of shale oil also increased, while that of coal-based diesel and light coal tar tightened.

Meanwhile, the supply of domestic marine gas oil (MGO) rallied to around 180,000 mt, up by 20,000 mt or 5.00% from July.

Bunker Prices, Profits

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: 12 September, 2022

Winding up

Singapore: Annual general meeting set for Xihe Holdings subsidiary

Annual general meetings will be held on 23 September for Nan Chiau Maritime to receive an update on firm’s liquidation, according to Government Gazette notice.

Published

16 hours ago

September 10, 2024

Admin

A notice was published on the Government Gazette on Monday (10 September) regarding the annual general meetings to be held on 23 September for Xihe Holdings subsidiary Nan Chiau Maritime Pte Ltd.

Annual general meetings for Nan Chiau Maritime are to be held at the following times:

For the company: 2pm
For the creditors: 3pm

The agenda for all the meetings are:

To receive an update on the liquidation.
To receive an account of the Liquidators’ acts and dealings, and of the conduct of the winding up.

The following are the details of the liquidator:

Ho May Kee
Liquidator
c/o 8 Marina View
#40-04/05 Asia Square Tower 1
Singapore 018960

Xihe Holdings Pte Ltd and its subsidiaries are owned by the Lim family, who are also the owners of the embattled Hin Leong Trading.

Manifold Times previously reported several resolutions for the firm were passed by written means, including winding-up the company.

Manifold Times also reported directors of Nan Chiau Maritime declaring the company’s inability to continue business.

Photo credit: Jo_Johnston from Pixabay
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.

Published

16 hours ago

September 10, 2024

Admin

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.

Published

16 hours ago

September 10, 2024

Admin

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