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Analysis

JLC China Bunker Market Monthly Report (July 2023)

China’s bonded bunker fuel sales fell back in July, due to bad weather in eastern regions; recorded 1.61 million mt of bonded bunker fuel sales with the daily sales dropping by 7.59% to 51,935 mt.

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

Bunker Fuel Demand

China’s bonded bunker fuel sales retreat in July

China’s bonded bunker fuel sales fell back in July, due to bad weather in eastern regions. 

The country recorded about 1.61 million mt of bonded bunker fuel sales in the month, with the daily sales dropping by 7.59% to 51,935 mt, JLC’s data indicates. The sales by Chimbusco, Sinopec Zhoushan, SinoBunker and China ChangJiang Bunker (Sinopec) were550,000 mt, 630,000 mt, 70,000 mt and 40,000 mt, respectively. At the same time, suppliers with regional bunkering licenses sold about 320,000 mt, the data also shows. 

Bunkering business in East China, especially at ports such as Ningbo Zhoushan Port, was hit hard by rains

and typhoons. Meanwhile, bonded bunker fuel supply decreased in East China, which also dragged down the sales in the region. However, the sales in North and South China, where refueling demand was largely stable, did not change much. 

China’s bonded bunker fuel exports rise 8.32% in H1

China’s bonded bunker fuel exports rose by 8.32% in the first half of this year amid multiple factors, speeding up from a rise of 3.35% in January-May. The country exported a total of 10.41 million mt of bonded bunker fuel in the first six months, up from 9.61million mt in the same months in 2022, JLC estimated, with reference to data from the GeneralAdministrationof Customs of PRC (GACC). 

Among these exports were 9.89 million mt of heavy bunker fuel and 522,100 mt of light bunker fuel, which respectively accounted for 94.99% and 5.01% of the total.

 By supplier, enterprises with national bunkering licenses exported about 8.49 million mt of bonded bunker fuel in this period, accounting for 81.56%, and those with regional licenses exported 1.92 million mt, making up 18.44%. 

China’s bonded bunker fuel exports plunged on year in January when shipping demand was seasonally weak. Meanwhile, bunkering business at Chinese ports was halted during the Chinese New Year holiday and China’s customs clearance was also affected by the holiday. However, the exports rallied in February as shipping demand recovered modestly and the operation of China’s customs returned to normal after the holiday. 

Bonded bunker exports surged to a 14-month high in March, mainly because of larger low-sulfur fuel oil (LSFO) production. At the same time, bunker fuel prices at Chinese ports showed an advantage over surrounding ports, attracting more foreign shipowners. But the exports fell back in April, as domestic LSFO output hit a 17-month low, due to bad margins and unit maintenance. 

Domestic supply of bonded bunker fuel increased in May-June, as Chinese refiners boosted their LSFO production amid slightly recovering margins and unit restarts. China released this year’s second batch of quotas on LSFO exports in May, encouraging refiners to expand exports.As a result, China’s bonded bunker fuel exports grew rapidly in the two months.

In June alone, China exported about 2.04 million mt of bonded bunker fuel, rising by 5.25% from the previous month and 34.96% from a year earlier. Heavy bunker fuel exports amounted to 1.93 million mt, accounting for 94.57%, and light bunker fuel exports were 110,900 mt, accounting for 5.43%. 

Suppliers with national licenses exported roughly 1.67 million mt in the month, accounting for 81.58% of the country’s total, with Sinopec Fuel Oil and Chimbusco taking 76.85%. At the same time, enterprises with regional licenses exported 376,000 mt, accounting for 18.42%, with PetroChina Fuel Oil (Zhoushan, Shanghai and Guangzhou) taking 227,700 mt which occupied 11.15% of China’s exports and 60.56% of regional suppliers’ total.

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Domestic-trade bunker fuel demand climbs in July

Domestic-trade heavy bunker fuel demand settled at 310,000 mt in July, a rally of 10,000 mt or 3.33% month on month, JLC’s data shows. Despite a modest bounce, heavy bunker fuel demand was still relatively tepid when typhoons forced some shipowners to suspend voyages. 

Meanwhile, domestic-trade light bunker fuel demand rose to about 140,000 mt, up by 5,000 mt or 3.70% from a month earlier. The bunker fuel market improved slightly amid stronger diesel, but the improvement was capped by some buyers’ wait-and-see attitude.

Bunker Fuel Supply

China slashes its bonded bunker fuel imports in H1 2023

China slashed its bonded bunker fuel imports in the first six months of 2023, largely due to lofty import costs.

The country imported approximately 1.85 million mt of bonded bunker fuel in the first half of this year, a plunge of 24.43% from the corresponding period in 2022, slowing down from a slump of 27.66% in January-May, JLC estimated, with reference to data from the General Administration of Customs of PRC (GACC).

As the largest supplier in this period, Malaysia shipped about 952,100 mt of bonded bunker fuel to China, accounting for 51.41% of the latter’s total imports. Singapore came in second with 485,800 mt, occupying 26.24%, followed by South Korea with 310,200 mt, accounting for 16.75%. Meanwhile, inflows fromJapanwere roughly 103,700 mt, making up 5.60%. 

China halved its bonded bunker fuel imports in the first quarter (Q1) of this year, with the monthly imports plunging to a historical low of 175,600 mt in March. Chinese distributors prioritized domestic bonded bunker fuel over imported one, as freight rates for imported cargoes were high and imported low-sulfur fuel oil (LSFO) lacked price advantages. Meanwhile, domestic bunker fuel supply increased when refiners boosted their LSFO production, which also dragged down the imports. The country produced a total of 3.80 million mt of LSFO in Q1, up from 3.56 million mt in the same quarter of 2022, JLC’s data shows. 

However, the imports rose in the second quarter (Q2) as domestic supply tightened, though freight rates for imported cargoes were still high. In view of fewer margins and unit maintenance, refiners lowered their LSFO output to roughly 3.50 million mt in the quarter, a cut of 7.73% from the previous quarter and 8.87%fromQ22022, JLC’s data indicates. The import arbitrage window opened in Q2 when China’s bonded bunker fuel prices climbed, prompting some distributors to increase imports to fill the demand gap. Meanwhile, some traders hiked their high-sulfur fuel imports, due to the decline in domestic LSFO supply.

Into the second half (H2) of this year, high freight rates will continue to depress the imports. Domestic supply of low-sulfur bonded bunker fuel is expected to be largely stable, and importers will still favor domestic resources. China’s bonded bunker fuel imports may reach 4.00-4.50 million mt in 2023, according to JLC’s projection.

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Domestic-trade bunker fuel supply increases in July

Domestic-trade heavy bunker fuel supply increased in July, as blenders raised output amid growing blendstock supply. 

Chinese blenders supplied about 360,000 mt of heavy bunker fuel in the month, a boost of 30,000 mt or

9.09% from June, JLC’s data shows. Refineries supplied more low-sulfur residual oil after maintenance, enabling blenders to ramp up bunker fuel production. Meanwhile, blenders showed higher blending interest, as downstream buyers became bullish on bunker fuel prices and increased purchases. 

Domestic-trade marine gas oil (MGO) supply settled at 170,000 mt in the month, jumping by 20,000 mt or 13.33% from a month earlier. Refineries supplied more light bunker fuel as coking margins grew sharply amid rising product prices.

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Bunker Prices, Profits

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Editor
Yvette Luo
+86-020-38834382
[email protected]   

Sales (Beijing)
Tony Tang
+86-10-84428863
[email protected]  

Sales (Singapore)
Ginny Teo
+65-31571254
[email protected]
[email protected]  

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 (June 2023)
Related: JLC China Bunker Fuel Market Monthly Report (May 2023)
Related: JLC China Bunker Market Monthly Report (March 2023)
Related: JLC China Bunker Market Monthly Report (February 2023)
Related: JLC China Bunker Market Monthly Report (January 2023)
Related: JLC China Bunker Market Monthly Report (December 2022)
Related: JLC China Bunker Market Monthly Report (November 2022)
Related: JLC China Bunker Market Monthly Report (October 2022)
Related: JLC China Bunker Market Monthly Report (September 2022)
Related: JLC China Bunker Market Monthly Report (August 2022)
Related: JLC China Bunker Market Monthly Report (July 2022)
Related: JLC China Bunker Market Monthly Report (June 2022)
Related: JLC China Bunker Market Monthly Report (May 2022)
Related: JLC China Bunker Market Monthly Report (April 2022)
Related: JLC China Bunker Market Monthly Report (March 2022)
Related: JLC China Bunker Market Monthly Report (February 2022)
Related: JLC China Bunker Market Monthly Report (January 2022)

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: 11 August, 2023

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Research

Sea Cargo Charter report demonstrates shipping’s shortfall against IMO climate goals

2024 report highlights the gap between current emissions and the IMO’s revised strategy for net-zero emissions by 2050.

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Sea Cargo Charter 2024 report

The shipping industry must take urgent action to meet ambitious new climate targets set by the International Maritime Organization (IMO), according to a new report released on Thursday (13 June) from the Sea Cargo Charter (SCC), a global transparency initiative developed by the Global Maritime Forum.

New data from the SCC, a global framework representing 20% of global bulk cargo transport, reveals the sector fell short of minimum international climate goals set by the IMO by an average of 17% in 2023, equivalent to 165 million metric tonnes of CO2e.

When considering ‘striving’ goals set by the IMO, signatories are on average 22% misaligned, which represents a shortfall of 204 million metric tonnes of CO2e in 2023.

Currently, dry bulk, general cargo, and tankers account for around 400 million tonnes of CO2 emissions. With global trade predicted to quadruple by 2050, emissions will skyrocket without urgent action.

Reporting has also been expanded to include “well-to-wake” emissions, which measure emissions from the extraction of oil to its end use, providing a more comprehensive picture of environmental impact and pushing the industry towards faster decarbonisation.

The 2024 report highlights the gap between current emissions and the IMO’s revised strategy for net-zero emissions by 2050. The report shows the importance of commercial and operational decisions on the vessels’ use (such as, instructed speed, cargo and routing optimisation, laden/ballast ratio), innovation and cooperation within the industry to be able to take action in this transition.

Other identified barriers to cutting emissions are geopolitical disruptions, limited alternative marine fuel options for long voyages, and a lack of infrastructure to support new technologies.

The 2024 Annual Disclosure Report was produced by the Global Maritime Forum, which performs secretariat services for the Sea Cargo Charter with expert support provided by UMAS and the Smart Freight Centre.

 

Photo credit: Sea Cargo Charter
Published: 14 June 2024

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Ammonia

Expert discusses technical considerations of using ammonia as marine fuel

Ammonia as bunker fuel poses significant safety challenges due to its toxicity and flammability, says Senior Marine Surveyor Muammer Akturk.

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Technical considerations of ammonia as marine fuel

Muammer Akturk, a Senior Marine Surveyor specialising in alternative bunker fuels, on Monday (10 June) published an article on technical considerations of using ammonia as a marine fuel in his Alternative Marine Fuels Newsletter.

The article dives into the use of ammonia as a marine fuel, focusing on the safety and technical considerations necessary for its implementation.

Ammonia is recognised for its potential as a zero-carbon fuel, making it an attractive option for reducing greenhouse gas emissions in the shipping industry. However, it poses significant safety challenges due to its toxicity and flammability.

Key points discussed include:

  1. Safety Measures: The importance of stringent design and operational safety measures to prevent ammonia releases and mitigate risks during both normal and emergency conditions is emphasized. This includes the need for gas dispersion analyses and the use of safety systems like gas detectors and alarms
  2. Regulatory Framework: The article reviews the latest regulations and guidelines developed to ensure the safe use of ammonia as a marine fuel. This includes the IACS Unified Requirement H1, which provides a framework for controlling ammonia releases on vessels
  3. Engineering Considerations: Technical aspects such as fuel storage, handling systems, and the role of risk assessments in identifying potential hazards and implementing preventive measures are detailed
  4. Human Factors: The article also considers the human factors approach to safety, emphasizing training and the importance of designing systems that account for human errorOverall, the article aims to provide a comprehensive overview of the challenges and solutions associated with using ammonia as a marine fuel, highlighting the importance of safety and regulatory compliance in its adoption.

Editor’s note: The full article can be found at the link here.

 

Published: 13 June 2024

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Analysis

JLC China Bunker Market Monthly Report (March 2024)

China’s bonded bunker fuel sales grew in March, as the shipping industry recovered gradually and sellers actively boosted sales on the back of ample supply and high inventories.

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JLC Bonded bunker fuel sales in Zhoushan (Mar 2024)

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

Bunker Fuel Demand

China’s bonded bunker fuel sales surge in March

China’s bonded bunker fuel sales grew in March, as the shipping industry recovered gradually and sellers actively boosted sales on the back of ample supply and high inventories. Domestic LSFO prices were lower than those in Singapore and other neighboring ports, incentivizing shipowners or operators to refuel their vessels in China, with bunkering volume in Shanghai and Zhoushan rising considerably.

The country sold about 1.82 million mt of bonded bunker fuel in the month, with the daily sales up 13.59% month on month to 58,658 mt, JLC’s data shows.

Sales by Chimbusco, Sinopec (Zhoushan) and China ChangJiang Bunker (Sinopec) came in at 540,000 mt, 630,000 mt and 30,000 mt in March, while those by suppliers with regional bunkering licenses settled at 558,400 mt. At the same time, SinoBunker sold about 60,000 mt of bonded bunker fuel, the data indicates.

China’s bonded bunker fuel exports rise in first two months

China’s bonded bunker fuel exports rose in the first two months of this year, underpinned by fresh quotas and larger production.

The country exported a combination of 3.02 million mt of bonded bunker fuel in January-February, growing by 3.13% from the same months in 2023, JLC estimated, with reference to data from the General Administration of Customs of the PRC (GACC).

Heavy bunker fuel exports totaled about 2.85 million mt in the two months, accounting for 94.13% of the total, while light bunker fuel exports were 177,500 mt, accounting for 5.87%.

The increase in the exports mainly came as China released this year’s first batch of quotas on LSFO exports at the end of 2023. Though refiners’ LSFO production margins were relatively poor, they ramped up their production amid new quotas, which buoyed the exports. China’s LSFO output totaled 2.57 million mt in January-February, with the daily output gaining 2.69% year on year to 42,850 mt, JLC’s data shows.

In January alone, China’s bonded bunker fuel exports settled at 1.78 million mt, jumping by 11.93% month on month and 34.71% year on year.

However, the exports plunged to 1.25 million mt in February, down by 29.99% month on month and 22.75% year on year. Bunkering business at Chinese ports was halted during the Chinese New Year holiday, and customs’ clearing procedure for export was also affected by the holiday. In addition, the operation of many ports was hit hard by heavy snow and freezing rains, adding to the downward pressure on the exports.

 

JLC China bunker exports by region 2023 2024

 

JLC China major blending producers' bunker supply (Mar 2024)

Domestic-trade bunker fuel demand rises in March

Domestic-trade heavy bunker fuel demand recovered mildly in March, as the shipping industry rebounded after the Chinese New Year holiday. However, the demand growth was still limited as some shipowners still suspended services and the market was dominated by wait-and-see sentiment amid high prices.

Domestic-trade heavy bunker fuel demand was estimated at 430,000 mt in the month, a gain of 70,000 mt or 19.44% from a month earlier, JLC’s data shows.

Meanwhile, domestic-trade light bunker fuel demand was estimated at about 140,000 mt, a gain of 20,000 mt or 16.67% from a month earlier, the data indicates.

Bunker Fuel Supply

China’s bonded bunker fuel imports soar in Jan-Feb

China’s bonded bunker fuel imports soared in January-February 2024, due to a low base a year earlier.

The country recorded 581,900 mt of bonded bunker fuel imports in the two months, a surge of 27.36% year on year, with 359,200 mt in January and 222,700 mt in February, JLC estimated, with reference to data from the GACC.

China’s bonded bunker fuel imports dived to a record low in January-February 2023, as bunkering demand had not fully recovered from the epidemic, also because of high freight rates and ample domestic supply. The imports totaled only 456,900 mt in the first two months of 2023, tumbling by 48.01% year on year.

On the other hand, Chinese refiners boosted LSFO production in January-February 2024, limiting the import growth. These refiners produced about 2.57 million mt of LSFO in the two months, with the daily output climbing by 2.69% year on year to 42,850 mt, JLC’s data shows.

Russia became the largest bonded bunker fuel supplier in the first two months of this year, exporting 276,800 mt to China, accounting for 47.57% of the latter’s total imports. Malaysia ranked second with 186,800 mt, accounting for 32.10%, followed by South Korea with 95,800 mt, accounting for 16.46%. Japan climbed to the fourth place with 21,500 mt, occupying 3.69%, while Singapore slipped to the fifth place with only 1,000 mt, making up 0.17%.

In China’s bonded bunker fuel market, only HSFO and MGO are still mainly imported, while LSFO is rarely imported as its import efficiency is relatively low amid steep freight rates.

JLC Bonded bunker fuel imports by source Jan Feb 2024

Domestic-trade bunker fuel supply increases in March

Domestic-trade heavy bunker fuel supply improved in March, as availability of some blendstocks (such as low-sulfur residual oil and shale oil) increased.

Chinese blenders supplied about 460,000 mt of domestic-trade heavy bunker fuel in the month, a rise of 60,000 mt or 15% from February, JLC’s data shows.

Similarly, domestic-trade MGO supply rose to 160,000 mt in March, up 30,000 mt or 23.08% month on month, the data shows. Refineries’ enthusiasm for MGO production improved in March, as domestic MGO prices moved up along with domestic oil products.

JLC Arrival of imported fuel oil cargoes

 

JLC China main oil blending feedstock prices

JLC China domestic trading 180 cSt bunker fuel price 2023 2024

JLC China bunker blending profit by region 2023 2024

Editor
Yvette Luo
+86-020-38834382
[email protected]

Sales (Beijing)
Tony Tang
+86-10-84428863
[email protected]

Sales (Singapore)
Ginny Teo
+65-31571254
[email protected]
[email protected]

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 Fuel Market Monthly Report (February 2024)
RelatedJLC 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: 11 April 2024

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