The Baltic Briefing has issued the tanker report for the 13th week of this year. The report dated 31st March 2022 provides valuable insight into this week’s gas market dealings, LNG, and LPG.
LNG
With more tonnage becoming available (caveated with several restrictions), there has been a softening of the spot market. Rates have sunk lower again on the back of lacklustre cargo enquiry. Discussions taking place have been, for the most part, relatively unsuccessful and rates are falling still in both basins. The Pacific BLNG1g Aus-Jap route fell another $4185 over the week to close at $64,330 a fall of $85,295 from the start of the year. We are into the summer months and a continued push to keep inventories ready for winter will garner much of the spot market for the moment. However, as yet it has had little impact on the spot pricing.
In the Atlantic, rates suffered similar falls with BLNG2g closing at $42,532 and little else reported or discussed. For BLNG3g there was a fixture of a 2-Stroke 180cbm vsl with both East and West options, which should calculate down to a Baltic 160cbm around $52,500. But the market fell further from here and closed at $50,295 for a USG-Japan run. Part of this downturn is explained by the macroeconomic news where gas inventories have been high, and a milder winter has kept usage lower. With strike action affecting some European countries there is potential for an uptick. Countries who have eaten into their reserves could look to replenish stocks, but this might be slow and the rates for spot currently remain unaffected.
Our current estimations for a 174k 2-Stroke vessel with 0.085% boil off and delivery one month ahead: $175,500 for 12 months, and $147,500 for 3-Years.
LPG
A dismal week for the LPG market and all three routes suffered casualties as rates dropped significantly. BLPG3 lost 28.61% of its value. And in the East, with a cargo going on subs for AG-East at $73, the market fell by over $10 in one day. A lack of cargoes and longer tonnage list all contributed to softening sentiment. Owners were keen to fix away at much lower rates to secure cargoes rather than sitting and waiting with nothing to show for it. The market didn’t regain any steady footing and rates fell $19 to close at $69.286 with a TCE return of $51,744 for a round voyage.
The West fared just as badly, a Houston-Chiba run lost huge grounds shaving $39.286 over the week. Although BLPG2 survived better, the lack of cargoes and interest in Houston-Flushing made this run more difficult to assess. Owners have had to wrestle with delays in the Panama Canal, but locking in for longer voyages was seen as the prudent course of action – even at diminishing returns. The market has fallen, but rates are still high historically speaking. For BLPG3 a high of $137.286 to the low close of $98 (a TCE equivalent of $37,516) we have seen the market crashing below triple digits.
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Source: Balticexchange
