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JLC China Bunker Market Monthly Report (December 2023)

Country recorded 1.54 million mt of bonded bunker fuel sales in December, with the daily sales down by 8.04% month on month to 49,810 mt, JLC’s data shows.

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JLC China Bunker Market Monthly Report (December 2023)

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

Bunker Fuel Demand

China’s bonded bunker fuel sales retreat in December

China’s bonded bunker fuel sales retreated in December, mainly due to tighter supply of low-sulfur bunker fuel.

The country recorded 1.54 million mt of bonded bunker fuel sales in December, with the daily sales down by 8.04% month on month to 49,810 mt, JLC’s data shows.

The sales by Sinopec Zhoushan, SinoBunker and China ChangJiang Bunker (Sinopec) fell to 560,000 mt, 50,000 mt and 30,000 mt in the month respectively, while those by suppliers with regional bunkering licenses dropped to 424,100 mt, down from 435,000 mt in November.

In the meantime, Chimbusco tallied about 480,000 mt of bonded bunker fuel sales, unchanged month on month, the data also indicates.

Low-sulfur fuel oil supply tightened amid insufficient export quotas, leading to a decline in China’s bonded bunker fuel sales. Meanwhile, bunkering operation at some Chinese ports was spoiled by bad weather, adding to the downward pressure on the sales.

China’s bonded bunker fuel exports drop further in November

China’s bonded bunker fuel exports dropped further in November, due to tighter quotas on low-sulfur fuel oil (LSFO) exports.

The country exported about 1.37 million mt of bonded bunker fuel in the month, a cut of 6.12% month on month, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

Heavy bunker fuel exports fell to roughly 1.31 million mt in November, accounting for 95.42% of the total, while light bunker fuel exports slipped to 62,700 mt, accounting for 4.58%.

Enterprises with national bunkering licenses exported about 933,200 mt of bonded bunker fuel in the month, making up 68.20%, with Sinopec Fuel Oil and Chimbusco taking 60.93%. Meanwhile, enterprises with regional licenses supplied 435,000 mt, accounting for 31.80%.

Facing quota tightness, Chinese refiners continued to cut their LSFO production and exports. China tallied only 637,000 mt of LSFO output in November, with the daily output at 21,233 mt, a plunge of 32.49% month on month, JLC’s data shows.

Sinopec’s application to convert quotas on 800,000 mt of fuel oil exports to those on oil product exports was approved in November, bringing China’s total LSFO quotas for 2023 down to 13.20 million mt. By the end of November, Chinese refiners had used about 96.1% of the total quotas, JLC’s data shows.

Lower exports were also ascribed to inflating export costs. The barging capacity at ports in South China and Shandong decreased, pushing up freight rates and hitting some bonded distributors’ export interest.

However, on a year-on-year comparison, China’s bonded bunker fuel exports grew by 5.68% in November.

China’s bonded bunker fuel exports totaled approximately 18.07 million mt in January-November, a gain of 1.09% from the same months in 2022, speeding up from 0.74% in January-October.

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Domestic-trade bunker fuel demand contracts in December

Domestic-trade bunker fuel demand contracted in December, as buyers’ acceptance of lofty prices was limited. Though China’s bunker fuel prices dropped in the month, they were still relatively high, supported by tight supply.

Domestic-trade heavy bunker fuel demand settled at 430,000 mt in the month, down by 20,000 mt or 4.4% from the previous month, JLC’s data shows. Meanwhile, domestic-trade marine gasoil (MGO) demand plunged to 130,000 mt, down by 30,000 mt or 18.8% month on month. Trading in the light bunker fuel market was tepid, and shipowners showed low buying interest.

Bunker Fuel Supply

China’s bonded bunker fuel imports soar in November

China’s bonded bunker fuel imports soared in November, because of tighter domestic supply.

The country imported about 536,900 mt of bonded bunker fuel in the month, a sharp boost of 32.70% month on month, JLC estimated, with reference to data from the General Administration of Customs of Chinese refiners cut their low-sulfur fuel oil (LSFO) output further in November, due to persistent quota tightness. China’s LSFO output settled at 637,000 mt in the month, with the daily output at 21,233 mt, a plunge of 32.49% from October, JLC’s data shows.

To fill the domestic supply gap, bonded distributors continued to increase their low-sulfur bunker fuel imports. However, continuous rises in the premiums for imported LSFO capped the imports to some degree.

High-sulfur bunker fuel imports also grew in the month amid supply tightness, while marine gasoil (MGO) imports held largely stable.

Singapore remained the largest supplier by sending 171,900 mt of bonded bunker fuel to China in the month, accounting for 32.02% of China’s total imports. Meanwhile, South Korea and Malaysia climbed to the second and third place with 158,800 mt and 92,900 mt, accounting for 29.58% and 17.31% respectively. Russia slipped to the fourth place with 70,700 mt, occupying 13.16%, followed by Japan with 42,500 mt, which made up 7.92%.

On a year-on-year comparison, however, China’s bonded bunker fuel imports dropped by 14.78% in November.

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Domestic-trade bunker fuel supply tightens in December

Domestic-trade heavy bunker fuel supply tightened in December, as blenders slowed down production when their blending costs inflated. Meanwhile, cargo delivery was not smooth against the background of strict tax inspection, forcing blenders to base their production on sales. Chinese blenders supplied about 430,000 mt of domestic-trade heavy bunker fuel in December, down by 30,000 mt or 6.52%, JLC’s data indicates.

At the same time, domestic-trade marine gasoil (MGO) supply settled at 150,000 mt, a monthly cut of 10,000 mt or 5.56%, the data shows. Refineries’ production enthusiasm was low when MGO prices dropped.

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Editor
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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.

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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 January, 2024

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Biofuel

SMW 2024: Ken Energy and Green COP partner to advance bio bunker fuels in Singapore

Through partnership between its two members, CSA said SGD 10 million will be invested into development and production of biofuel blends and aims to launch commercial-scale production by 2026.

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SMW 2024: Ken Energy and Green COP partner to advance bio bunker fuels in Singapore

The Coastal Sustainability Alliance (CSA), an industry collaborative effort led by Kuok Maritime Group (KMG), on Tuesday 916 April) announced its plans to advance the maritime biofuel ecosystem in Singapore with up to SGD 10 million (USD 7.33 million) in investments. 

The partnership will be spearheaded by two of its Alliance members – Green COP and Ken Energy – which formalised a Memorandum of Understanding (MOU) today at the Tech Stage (EXPO @SMW) at Singapore Maritime Week 2024.

Over the next two years, the CSA aims to develop stable B30, B40 and B50 biofuel blends and achieve production and commercial adoption of up to 50% (B50), derived from 50% agri-waste to Biobutanol – a blend poised to significantly reduce carbon emissions in maritime operations.

This process includes biofuel certification, commencing sea trials, building a production plant by 2025, and launching commercial-scale production by 2026. An initial SGD 500,000 angel investment has been secured for establishing a pilot plant for processing agri-waste, and over SGD 10 million is expected to be invested in scaling production capabilities.

These efforts in decarbonising the maritime sector will contribute to the CSA’s efforts to build the next generation of Singapore’s coastal ecosystem and are timely to address the potential surge in demand for sustainable biofuels.

Mr Tan Thai Yong, Managing Director, Strategic Projects and Technology, Kuok Maritime Group and Chairperson, CSA Council, said: “The formation of biofuel ecosystem under the Coastal Sustainability Alliance demonstrates our commitment to foster partnerships and deliver innovative sustainable maritime solutions for our conventional fleet owners as they progressively switch to lower emissions vessels.

“In bringing together Green COP and Ken Energy, we are laying the groundwork for a new biofuel supply chain and providing a viable alternative in the energy transition for the maritime sector. This initiative is more than an advancement in fuel technology as it exemplifies the power of collaboration, underscoring the CSA’s role as a steward and catalyst for positive change in the maritime industry.”

The CSA is actively driving maritime biofuel development to provide a viable biofuel alternative for vessels to reduce carbon emissions. The ecosystem will secure a ready supply of biofuel for local coastal demand and ensure the quality and stability of the biofuels with supply chain track and trace. This initiative also seeks to bolster Singapore’s standing in the Global Biofuels Alliance over the long term by building new R&D and innovation tracks in line with the nation’s environmental commitments.

Through this partnership, Ken Energy will play a pivotal role in strengthening the market and commercial utilisation of Biobutanol in maritime operations. This comprises vital aspects such as operational feasibility, life cycle assessment, and carbon emission reduction strategies. Ken Energy’s expertise and resources will be instrumental in optimising the practical implementation of Biobutanol for a B30-B50 blend and subsequent market integration in providing B50 to its customer fleet of bunker barges and CSA members.

Desmond Chong, Managing Director of Ken Energy, said: “We believe in the green transition that the maritime industry is embarking on. This conviction underscores our strategic collaboration with Green COP. Leveraging our proficiency in marine transportation logistics alongside Green COP's commendable sustainable biofuel production, we aim to spur the industry's widespread adoption of biofuels."

Green COP, with its proprietary technology, specialises in the efficient conversion of plant-based biowaste into sustainable biofuels through a patented pre-treatment and fermentation process. This innovative, cost-effective approach maximises resource utilisation and minimises waste generation, contributing to the circular economy and environmental sustainability.

Dr Hanson Lee, CEO of Green COP, said, “Green COP presents existing fleet owners with a coherent biofuel solution to achieve their net-zero targets in a progressive manner. We envision a future where Sustainable Marine Fuels (SMF), alongside coastal electrification, become the norm. The CSA has provided us access to market insights, industry collaborations and the necessary incubation for our growth. We look forward to working with more like-minded partners to spur biofuels research and adoption.”

Earlier in March 2024, Green COP signed an MOU agreement with 3Y Energy to develop and optimise green biofuel blends for the maritime and transportation sectors. Through this collaboration, Green COP will set up a pilot plant capable of processing a ton of biomass daily to produce sustainable fuels, while 3Y Energy will provide the innovative solutions in green fuel utilisation including biofuel blends. 

Introducing the B50 blend represents a significant advancement in reducing carbon emissions within the maritime industry. For every metric ton (mt) of B50 fuel burned, carbon emissions are reduced to 1.5 mt, a substantial improvement over the B30 blend, which reduces CO2 emissions to 2.1 mt per metric ton of fuel burned. Additionally, the production of Biobutanol, a key component of the B50 blend, is more energy-efficient and yields a higher volume of fuel compared to traditional methods used for producing Fatty Acid Methyl Ester (FAME). This enhances the sustainability of the fuel production process and supports the maritime sector’s transition to greener energy sources.

The CSA will continue to broaden the scope of the pioneering biofuel ecosystem and seek additional collaborations from stakeholders across the maritime and energy sectors to enhance technological, adoption and logistical capabilities.

This development follows closely on the heels of the Coastal Sustainability Alliance PXO Electric Fleet Signing and MoU Ceremony, held on 12 April.

Related: Alliance commences building of electric tug and supply boat for Singapore waters
Related: SMW 2024: Singapore is preparing port for multi-fuel future, says Transport Minister
Related: SMW 2024: MPA partners with S&P Global and Bunkerchain in digital ship identity
Related: SMW2024: 18th Singapore Maritime Week opens with ‘Actions meet Ambition’ theme
Related: SMW 2024: MPA to set up facility for maritime workforce to train in handling new bunker fuels
Related: SMW 2024: Singapore-Rotterdam Green and Digital Shipping Corridor partners to implement first-mover pilot projects

 

Photo credit: Coastal Sustainability Alliance
Published: 17 April 2024

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Alternative Fuels

SMW 2024: Pacific Environment, Ulsan Port Authority to accelerate zero-emission shipping and ports

Both signed a MoU to develop zero-emission shipping and ports in South Korea, within Asia, across transpacific and global corridors including possibility of supporting Korea Ports to transition to green bunker fuels.

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SMW 2024: Pacific Environment, Ulsan Port Authority mulls transition to green bunker fuels in South Korea

Pacific Environment on Tuesday (16 April) said it signed a Memorandum of Understanding (MoU) with Ulsan Port Authority outlining a vision of multi-year collaboration to accelerate zero-emission shipping and ports in the Republic of Korea, within Asia, across transpacific and global corridors. 

The MOU Signing Ceremony occurred during a joint reception co-hosted by Pacific Environment and Ulsan Port Authority with more than 50 participants during the Singapore Maritime Week 2024.

The MOU includes areas of possible cooperation: 

  • Supporting the Republic of Korea to decarbonise both its domestic shipping and harbour craft industry to align all Republic of Korea ports with the United Nations Framework Convention on Climate Change 1.5 degree Celsius trajectory
  • Support the Uslan Port to design and implement green shipping corridors across Asia, the transpacific and global corridors
  • Support the Ulsan Port and Republic of Korea Ports to transition to green fuels and provide electric power and zero-emission lifecycle fuels to help marine vessels meet zero-emissions prior to 2050 
  • Provide the Ulsan Port with an action plan to achieve the International Maritime Organization’s 2023 Greenhouse Gas Strategy 
  • Support the Ulsan Port to address additional marine and climate policy issues, such as ending ocean plastic pollution, fossil fuel shipping pollution, among others
  • Support improvement of the Ulsan Port and Republic of Korea Port’s system to prompt the use of green fuels, develop workforce safety standards and train workers.

This is the second MOU that Pacific Environment has signed with Republic of Korea maritime leaders. Last May 2023, Pacific Environment and Korean Maritime Institute signed a multiyear MOU to accelerate zero-emission shipping and ports. 

Soonyo Jeong, Vice President, Ulsan Port Authority, said: “We are excited about our partnership with Pacific Environment and look forward to the support the organisation can provide on-the-ground to move our port and our country to a zero-emission future.”

“As the largest bunkering port in the Republic of Korea, we hope to do our part to address climate change and move shipping to a 1.5 degree Celsius future.”

Shannon Wright, Executive Director, Pacific Environment, said: “Pacific Environment is proud to partner with the Port of Ulsan. Today’s signing of the Memorandum of Agreement between the Port of Ulsan and Pacific Environment is an exciting start to a multiyear partnership. 

“Ulsan Port has been designated as the only green ship fuel supply port in the Republic of Korea, and aims to become an green energy logistics hub.”

“We look forward to supporting the port with strategic policy and planning assistance to support the efforts towards zero-emission shipping and ports.”

Related: SMW 2024: Singapore is preparing port for multi-fuel future, says Transport Minister
Related: SMW 2024: MPA partners with S&P Global and Bunkerchain in digital ship identity
Related: SMW2024: 18th Singapore Maritime Week opens with ‘Actions meet Ambition’ theme
Related: SMW 2024: MPA to set up facility for maritime workforce to train in handling new bunker fuels
Related: SMW 2024: Singapore-Rotterdam Green and Digital Shipping Corridor partners to implement first-mover pilot projects

 

Photo credit: Pacific Environment
Published: 17 April 2024

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MoU

SMW 2024: Seatrium, A*STAR to explore new energies and AI for offshore and marine uses

Both organisations will focus on establishing a sustainable ammonia supply chain and addressing bunkering, transportation, and storage challenges, amongst others.

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SMW 2024: Seatrium, A*STAR to explore new energies and AI for offshore and marine uses

Singapore-headquartered marine engineering firm Seatrium and Singapore’s Agency for Science, Technology and Research (A*STAR) on Tuesday (16 April) inked a Memorandum of Understanding (MoU) to explore research opportunities in new energies and artificial intelligence (AI) to develop innovative products and engineering solutions for the Offshore and Marine (O&M) Sector. 

The MoU signing took place during the Singapore Maritime Week and was witnessed by the event’s Guest of Honour, Dr Amy Khor, Senior Minister of State, Ministry of Transport and Ministry of Sustainability and the Environment.

The collaboration combines Seatrium’s insights into trends and opportunities within the O&M sector with the research capabilities of A*STAR and its National Platforms such as the Technology Centre for Offshore and Marine, Singapore (TCOMS). The parties aim to boost the O&M sector’s pivot to new energies efficiently and reliably, and support the global transition to a low-carbon economy. Through machine learning, manufacturing process technologies and digital solutions, the collaboration will also streamline product development and manufacturing processes, and promote innovation and sustainability in Seatrium’s operations.

The focus areas of the MoU include the co-development of:

New Energies

This includes the exploration of new energies such as hydrogen and ammonia solutions, specifically tailored for offshore and marine applications. A*STAR and Seatrium were part of Singapore’s first ammonia fuel trial on the Fortescue Green Pioneer. 

A*STAR contributed to the development of an ammonia plume model for safety and environmental impact assessment, while Seatrium was responsible for the installation of the vessel’s fuel system and safety features.

Both organisations will now focus on establishing a sustainable ammonia supply chain and addressing bunkering, transportation, and storage challenges. Coupled with carbon capture technologies, Seatrium's suite of product solutions aims to provide sustainable energy solutions for the offshore and marine sector.

Artificial Intelligence (AI)

The partnership leverages AI to explore innovative solutions in engineering processes, operational efficiency, and decision-making across project lifecycles. 

This includes the planned development of Large Language Models (LLMs) to improve vessel design and validation turnaround by automating and streamlining parts of the process. AI will be used to automate work site inspection and surveillance for improved operational efficiency.

Since 2008, Seatrium’s predecessor entities and A*STAR have worked on research projects such as green shipping, digital design, automation, Internet of Things (IoT) and advanced manufacturing. 

The outcomes have culminated in the development of new capabilities, including co-designing the world’s first made-in-Singapore Low Ultraviolet (LUV) Ballast Water Treatment System. 

This eco-friendly system employs energy-efficient ultra-violet rays and proprietary ultra-low frequency bio-fouling control for chemical-free treatment of ballast water.

Mr Chris Ong, CEO of Seatrium, said: “The collaborative efforts between Seatrium and A*STAR are geared towards accelerating the energy transition and maritime decarbonisation.”

“By combining our knowledge and pushing boundaries, we aim to develop advanced energy solutions that will help the industry adopt renewable sources more quickly.”

“Through innovation, research, and sustainable practices, we are focused on minimising carbon emissions, improving operational efficiency, and promoting cleaner energy.”

“We are committed to making a positive impact and playing a vital role in Singapore's sustainable O&M sector with the support of our partners, stakeholders, and customers.”

Mr Frederick Chew, CEO of A*STAR, said: “Building on our previous successful collaboration programmes in green shipping, digital design and advanced manufacturing, this latest collaboration in new energies and AI furthers Seatrium and A*STAR’s shared vision of developing more smart and sustainable solutions for the O&M sector.”

“I look forward to programme outcomes that will contribute substantively to Seatrium’s and Singapore’s economic and sustainability goals.”

Related: Fortescue successfully conducts world’s first ammonia bunker fuel trial in Singapore
Related: SMW 2024: Singapore is preparing port for multi-fuel future, says Transport Minister
Related: SMW 2024: MPA partners with S&P Global and Bunkerchain in digital ship identity
Related: SMW2024: 18th Singapore Maritime Week opens with ‘Actions meet Ambition’ theme
Related: SMW 2024: MPA to set up facility for maritime workforce to train in handling new bunker fuels
Related: SMW 2024: Singapore-Rotterdam Green and Digital Shipping Corridor partners to implement first-mover pilot projects

 

Photo credit: Seatrium and A*STAR
Published: 17 April 2024

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