Business

JLC China Bunker Market Monthly Report (November 2022)

China’s bonded bunker fuel sales fell further in November, as downstream consumption kept shrinking amid COVID-19 virus and related restrictions, JLC data showed.

Published

2 years ago

December 13, 2022

Admin

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

Bunker Fuel Demand

China’s bonded bunker fuel sales fall further in Nov

China’s bonded bunker fuel sales fell further in November, as downstream consumption kept shrinking amid the virus and related restrictions, despite a drop in domestic bunker fuel prices. The sales at most Chinese ports except for Ningbo Zhoushan port were stable to lower month on month.

The country sold about 1.54 million mt of bonded bunker fuel in November, a monthly dip of 3.46%, JLC’s data shows. Specifically, the sales by Chimbusco went up to 570,000 mt, while those by Sinopec Zhoushan, SinoBunker and China ChangJiang Bunker (Sinopec) slid to 580,000 mt, 60,000 mt and 45,000 mt respectively. In addition, suppliers with local licenses sold 280,000 mt of bonded bunker fuel in the month.

China’s bonded bunker fuel exports plunged to a 31-month low in October, as demand in the shipping market was dampened by the epidemic and China lost price advantages of bonded low-sulfur fuel oil (LSFO). China recorded roughly 1.23 million mt of bonded bunker fuel exports in October 2022, a collapse of 38.60%month on month and 20.25% year on year, setting a new low since March 2020, according to the data from the GeneralAdministration of Customs of PRC (GACC). Among the exports were about 1.17 million mt of heavy bunker fuel and 65,600 mt of light marine gas oil (MGO), accounting for 94.68% and 5.32% of the total respectively.

Enterprises with national licenses exported approximately 994,200 mt of bonded bunker fuel in the month, making up 80.59%, while those with local licenses exported 239,400 mt, accounting for 19.41%, GACC data indicates.

China’s bonded bunker fuel exports saw a dramatic slump as bunker fuel consumption in the shipping market was hit hard by the lingering negative impact of the virus. Meanwhile, some ship owners reduced purchases as bunker fuel prices at certain ports rose on relatively tight supply, adding to the downward pressure on the exports.

On the other hand, China’s LSFO output rallied in the month, with some refiners moderately boosting LSFO production on the strength of a new batch of export quotas. The country’s LSFO output (of Chinese refiners with export quotas) totaled about 1.33 million mt in October, gaining 6.23% month on month, JLC’s data shows.

Domestic bunker fuel demand contracts in Nov

Domestic-trade bunker fuel demand continued to contract last month, as more downstream buyers stood onthe fence amid a bland outlook of the domestic bunker fuel market. The demand for heavy bunker fuel dwindled to 360,000 mt in November, down by 30,000 mt or 7.69%fromOctober, JLC’s data indicates. Downstream buyers showed resistance to relatively high bunker fuel prices when the negative effects of the epidemic persisted. Likewise, light bunker fuel demand remained on a downswing with ship owners’ costs still relatively steep, though marine gas oil (MGO) prices observed a modest withdrawal. Domestic-trade light bunker fuel demand settled at 130,000 mt in the month, a decline of 15,000 mt or 10.34% month on month, the data shows. Purchases were still based on rigid demand and overall trading was quite thin.

Bunker Fuel Supply

China’s bonded bunker fuel imports extend gains in October

China expanded its bonded bunker fuel imports further in October as domestic supply was still relatively tight despite a slight rise in low-sulfur fuel oil (LSFO) output.

China tallied about 503,900 mt of bonded bunker fuel imports in October, growing by 17.76%month on month and nearly doubling year on year, according to data from the General Administration of Customs of PRC (GACC).

Domestic bonded bunker fuel supply remained relatively tight as less profitable production dampenedChinese refiners’ enthusiasm. Although certain refiners boosted their LSFO production moderately amid newexport quotas, most still prioritized diesel production and export of which margins were more considerable. The country’s LSFO output (of Chinese refiners with export quotas) totaled about 1.33 million mt in October, gaining 6.23% month on month, with the daily output climbing by 3.80% to 42,903 mt, JLC’s data shows.

In addition, some Chinese ports lost price advantage with domestic bonded 0.5% sulfur bunker fuel oil prices inflating, leading some market participants to increase imports of bonded bunker resources.

The UAE still led all suppliers by exporting 149,500 mt of bonded bunker fuel to China, despite a month-on-month slump of 46.22%, accounting for 29% of the total. Meanwhile, the imports fromSouth Korea and Russia rose to 111,600 mt and 105,300 mt, making up 22% and 21% respectively. Malaysia remained in fourth with imports from the country amounting to 69,600 mt and occupying 14%. There were also some imports coming from Singapore and Japan, which accounted for 8% and 6% respectively. China imported an accumulation of roughly 4.07 million mt of bonded bunker fuel in the first ten months of 2022, a tremendous plunge of 42.39% year on year, GACC data shows.

The plunge was mainly attributed to larger LSFO production. The country produced a total of 12.61 million mt of LSFO in January-October 2022, a steep jump of 38.96% from the corresponding months in 2021, JLC’s data shows. China has been making great efforts to ramp up LSFO production over the recent years, aiming to reduce its reliance on imported low-sulfur resources.

Domestic blended bunker fuel supply tightens in Nov

Chinese blenders supplied 390,000 mt of heavy bunker fuel in November, a cutback of 30,000 mt or 7.14%from the previous month, JLC’s data indicates. Domestic blended heavy bunker fuel supply tightened in the month due to a further decrease in blendstock supply. The transportation of light coal tar and coal-based diesel was constrained by the virus-related restrictions coupled with bad weather in northern regions. Meanwhile, cargo delivery in Shandong was also hampered by the epidemic, adding to the downward pressure on domestic supply. As for blended light bunker fuel, the supply of domestic marine gas oil (MGO) fell by 20,000 mt or 11.76% to 150,000 mt in the month, the data shows. Downstream buyers became more cautious about purchases with the domestic diesel market ushering in a seasonal off-season.

Bunker Prices, Profits

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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 December, 2022

Financial Result

CBL International gross profit down 32.2% on year for 1H 2024

Decline primarily driven by reduction in premium sold to customers; leading to lower gross profit per tonne even though there was an increase in volume sold, says CBL.

Published

2 days ago

September 13, 2024

Admin

CBL International Limited (CBL), the listing vehicle of Banle Group (Banle), a marine fuel logistic company in the Asia-Pacific region, on Thursday (12 September) announced its unaudited financial results for the six months ended 30 June.

CBL said its gross profit for the period was approximately USD 2.72 million, a decrease of 32.2% compared to USD 4.01 million for 1H 2023.

The firm said the decline was primarily driven by the reduction in premium sold to customers and led to lower gross profit per tonne, which was partially offset by an increase in volume sold.

CBL also reported its Consolidated revenue for 1H 2024 increased by 44.4% to approximately USD 277.23 million, compared to USD 191.96 million in the same period in 2023.

“This significant growth was driven by a 39.4% year-over-year increase in sales volume, attributed to the expansion of the Company's global supply network and higher marine fuel demand due to geopolitical factors,” it said.

The company announced the pricing of its initial public offering on Nasdaq Capital Market on 22 March last year.

“We are pleased with the robust growth in our revenue and sales volume during the first half of 2024, despite the challenging market conditions. Our strategic initiatives, including the expansion of our service network and our focus on sustainable fuel solutions, have positioned us well to navigate these challenges and capitalise on emerging opportunities,” said Teck Lim Chia, Chairman & CEO of Banle Group.

“While the current market environment has pressured our margins, we remain confident in our long-term strategy and our ability to deliver value to our shareholders.”

Other Financial Highlights:

Operating Expenses: Operating expenses rose by 64.0% to approximately USD 4.12 million, up from USD 2.51 million in 1H 2023. This increase was attributed to higher selling and distribution expenses related to our sales growth, strategic expansion in the Company's supply network to new geographic areas, and the development of our biofuel operations.
Net Income: The company reported a net loss of approximately USD 1.62 million, compared to a net income of USD 1.15 million in 1H 2023. The loss was driven by lower gross margin and higher operating costs.
Cash Flow: Net cash provided by operating activities was approximately USD 2.30 million, a significant improvement from a cash outflow of USD 7.24 million in 1H 2023, reflecting better management of working capital.
Cash position: As of June 30, 2024, Banle's consolidated cash balance increased by approximately USD 2.29 million, or 30.9%, to USD 9.69 million, compared to USD 7.40 million as of December 31, 2023. This increase was primarily driven by improved working capital management. The Company also reported a significant increase in accounts receivable and accounts payable balances, reflecting the growth in its sales activities.

Operational Highlights:

Global Network Expansion: As of June 30, 2024, Banle expanded its global service network from 36 ports at our IPO in March 2023 to over 60 ports across Asia, Europe and Africa. This strategic expansion has enabled the Company to secure new bunkering business opportunities, particularly in European markets where environmental regulations are increasingly stringent. The opening of the Company's new office in Ireland in late 2023 has bolstered our market coverage and enhanced local sourcing capabilities. Notably, the Company completed inaugural bunkering services through a local physical supplier in Mauritius in May 2024, further strengthening our market presence.
Biofuel Initiatives: Banle continued its commitment to sustainability by expanding its B24 biofuel operations, obtaining ISCC EU and ISCC Plus certifications in 2023. The Company successfully commenced biofuel bunkering services through local physical suppliers in Hong Kong, China, and Malaysia, positioning itself as a pioneer in sustainable fuel solutions. The B24 biofuel blend, which includes 24% UCOME (used cooking oil methyl ester), offers a 20% reduction in greenhouse gas emissions compared to conventional marine fuels, aligning with global decarbonisation efforts.
Response to Macroeconomic Environment: The global economy has shown signs of moderate growth in 2024, with emerging markets, particularly in Asia, driving this recovery. However, the shipping industry continues to face challenges such as fluctuating freight rates, port congestion, and disruptions in major trade routes due to the ongoing Red Sea Crisis. Banle has proactively adapted to these conditions, coordinating increased fuel supplies in Asian ports to meet heightened demand, ensuring that our customers' needs are met despite logistical challenges.

Looking ahead, Banle said it remains focused on expanding its market presence, particularly in the biofuel sector, and continuing to enhance its global supply network.

Photo credit: Essow on Pexels
Published: 13 September, 2024

Alternative Fuels

KPI OceanConnect expands Asia footprint with new Tokyo office

New office will help existing and new clients navigate increasing operational complexity in the marine energy sector, from new alternative bunker fuels to tightening environmental regulations.

Published

2 days ago

September 13, 2024

Admin

KPI OceanConnect expands Asia footprint with new office in Japan

Marine energy solutions provider KPI OceanConnect on Thursday (12 September) announced the opening of its new office in Tokyo, Japan, to strengthen its regional presence and support to local customers.

The office is KPI OceanConnect’s fifth in Asia, reflecting an increasing commitment to strategic growth in the region.

Japan is a leading innovator in the maritime industry, operating the third largest merchant fleet and is an important market for KPI OceanConnect.

The new office, led by Ken Kobayashi, Head of Japan, will help existing and new clients navigate increasing operational complexity in the marine energy sector, from new alternative fuels to tightening environmental regulations.

The announcement follows KPI OceanConnect’s recent publication of robust financial results for the year 2023/2024 and demonstrates its continued commitment to investing in building strong partnerships across the marine fuels value chain worldwide.

The expansion of the local team in Japan will enable KPI OceanConnect to actively engage with Japanese buyers and suppliers on a daily basis to exchange knowledge and expertise to support the development of innovative energy transition strategies for its clients.

The launch of the new office was celebrated with an opening reception on 10 September. The event was attended by the group’s owner, Nina Østergaard Borris and the Executive Management team of KPI OceanConnect, including Anders Grønborg, CEO, Dorthe Bendtsen, COO, and Jesper Sørensen, Global Head of Alternative Fuels and Carbon Markets.

To celebrate this milestone, KPI OceanConnect hosted an opening reception at the XEX Tokyo restaurant, just steps away from its new office in the Burex building. The event also featured music by DJ Yumi.

Anders Grønborg, CEO of KPI OceanConnect, said: “KPI OceanConnect has worked closely with clients in Japan for a very long time. As a key market for our sector and our business, this new office allows us to be closer to our customers and other important local stakeholders.”

“It is a time of transformation in the maritime value chain, and we are ready to work with our partners to identify opportunities for further collaboration and innovative solutions. We believe that our values of decency, good governance, transparency and long-term sustainability resonate well in this market.”

Ken Kobayashi, Head of Japan, KPI OceanConnect, said: “KPI OceanConnect is here to support its clients in turning today’s challenges and future uncertainties into opportunities for growth and innovation. From new fuels to new regulations, our network of experts is focused on delivering tailored, value-adding services to clients to future-proof their decision making, no matter the complexity.

“With a partnership-driven approach, we’re enabling greater transparency and innovation and are helping rewrite the bunkering playbook to support clients through the energy transition.”

Photo credit: KPI OceanConnect
Published: 13 September, 2024

Alternative Fuels

European shipowners and bunker fuel producers launch Clean Maritime Fuels Platform

Members of the initiative include ECSA, FuelsEurope, eFuel Alliance, European Waste-based & Advanced Biofuels Association, HydrogenEurope and Methanol Institute.

Published

2 days ago

September 13, 2024

Admin

European shipowners and bunker fuel producers launch Clean Maritime Fuels Platform

The European Community Shipowners’ Associations (ECSA) on Thursday (12 September) announced the launch of the Clean Maritime Fuels Platform.

The new Clean Maritime Fuels Platform is a bottom-up industry initiative aiming to enhance communication between the shipping sector and fuel producers and to identify common challenges and possible solutions, considering the implementation of the Fit for 55 package and the transition to a net-zero economy by 2050.

Members of the initiative include ECSA, FuelsEurope, eFuel Alliance, European Waste-based & Advanced Biofuels Association (EWABA), HydrogenEurope and Methanol Institute.

According to ESCA, access to clean maritime fuels is a top priority for the decarbonisation of the shipping sector.

The recently published Draghi report on the Future of European Competitiveness identifies shipping as one of the most difficult sectors to decarbonise, requiring around 40 billion in annual investments between 2031 and 2050.

The report highlighted that, while the EU is a world leader in sustainable renewable and low-carbon fuels for the decarbonisation of transport, it has limited installed capacity and planned production. The EU needs to start building a supply chain for clean fuels, or the costs of meeting its targets will be significant.

Representatives of ECSA, FuelsEurope, eFuel Alliance, EWABA, HydrogenEurope and Methanol Institute held their first meeting on 12 September and agreed on the objectives and the working principles of the new platform. Members also started to discuss the key topic of infrastructure gaps.

The platform will focus on policies and tools to support the production and uptake of clean maritime fuels in Europe including areas such as maritime in EU ETS and funding opportunities.

The platform will hold regular meetings with ECSA taking care of the secretariat’s tasks.

“Today, the shipping and energy industry join forces and launch a dialogue platform that can facilitate better flow of information about the common challenges we are facing. We need all hands on deck to make the energy transition happen. In order to meet our targets, we need clean fuels available in the market in sufficient quantities and at an affordable price. European shipowners are proud to launch with the fuel producers the Clean Maritime Fuels Platform”, said Sotiris Raptis, ECSA Secretary General.

“We are very excited to launch the Clean Maritime Fuels Platform today. Our 55+ members from across the EU are working tirelessly to produce waste-based and advanced biodiesel of the highest quality requirements and GHG savings to bring a new era of clean shipping to Europe. We believe that a closer collaboration between renewable fuel suppliers and ship owners will significantly reduce technical, operational, and financial barriers across the supply chain for the development and uptake of renewable maritime fuels”, said Angel Alvarez Alberdi, Secretary General of EWABA.

“The energy transition is a gradual journey, not an overnight change. It demands a robust regulatory framework and collaboration among all stakeholders involved to drive effective decarbonization. As we work alongside our 100 members through the complexities of this transition, the Clean Fuels Maritime Platform will play a crucial role in accelerating our shift to cleaner fuels and innovative technologies. By combining our collective expertise and efforts, we are not only tackling the pressing need for emission reductions but also laying the groundwork for a more resilient and sustainable maritime industry”, said Greg Dolan, CEO of Methanol Institute.

Photo credit: European Community Shipowners’ Associations
Published: 13 September, 2024