Platts proposes to launch six Atlantic Ultramax grains, ferrous scrap, petcoke TCEs and weighted average Atlantic Ultramax dry bulk TCE indexes from Nov 1

Platts, part of S&P Global Commodity Insights, proposes to publish six Ultramax dry bulk time charter equivalent assessments -- reflecting shipments of grains from the US Gulf Coast and East Coast South America to the Mediterranean and Far East; ferrous scrap from the North Sea to the Mediterranean; and petcoke from the US Gulf Coast to the Mediterranean and Far East -- effective Nov. 1, 2023, to reflect the growing trade on these Atlantic Ultramax routes.

The proposed TCE assessments for grains would reflect the cost of transporting a 55,000 mt (plus/minus 10%) grains cargo on a 63,000 dwt Ultramax dry bulk vessel:

-- from New Orleans, Louisiana to Kashima, Japan, with bunkering at the port of Balboa

-- from Santos, Brazil to Qingdao, China, with bunkering at the port of Gibraltar

-- from Recalada, San Lorenzo, Argentina to Bejaia, Algeria, with bunkering at the port of Gibraltar.

The proposed TCE assessment for ferrous scrap would reflect the cost of transporting a 55,000 mt (plus/minus 10%) scrap cargo on a 63,000 dwt Ultramax dry bulk vessel from Rotterdam, Netherlands to Aliaga, Turkey, with bunkering at the port of Rotterdam.

The proposed TCE assessments for petcoke would reflect the cost of transporting a 55,000 mt (plus/minus 10%) petcoke cargo on a 63,000 dwt Ultramax dry bulk vessel:

-- from New Orleans, Lousiana to Iskenderun, Turkey, with bunkering at the port of Houston

-- from Houston, Texas to Krishnapatnam, India, with bunkering at the port of Houston.

Platts is proposing to publish these TCE assessments on a standard Ultramax vessel using 0.5% marine bunker fuel and a scrubber-fitted Ultramax vessel using 3.5% sulfur fuel. The proposed assessments would be published on a $/day basis.

The port charges, vessel speed and bunker fuel consumption used in the TCE calculations are arrived at by extensive market survey and reflect market practice.

The proposed assessments would reflect the value at the London market close of 4:30 pm London time and follow the London publishing schedule.

The proposed assessments are:

New Orleans-Kashima 50,000 mt grains time charter equivalent 0.5% VLSFO – Daily

New Orleans-Kashima 50,000 mt grains time charter equivalent 0.5% VLSFO MAvg - Monthly

New Orleans-Kashima 50,000 mt grains time charter equivalent scrubber-fitted - Daily

New Orleans-Kashima 50,000 mt grains time charter equivalent scrubber-fitted MAvg – Monthly

Santos-Qingdao 50,000 mt grains time charter equivalent 0.5% VLSFO – Daily

Santos-Qingdao 50,000 mt grains time charter equivalent 0.5% VLSFO MAvg - Monthly

Santos-Qingdao 50,000 mt grains time charter equivalent scrubber-fitted - Daily

Santos-Qingdao 50,000 mt grains time charter equivalent scrubber-fitted MAvg – Monthly

Recalada-Bejaia 40,000 mt grains time charter equivalent 0.5% VLSFO – Daily

Recalada-Bejaia 40,000 mt grains time charter equivalent 0.5% VLSFO MAvg - Monthly

Recalada-Bejaia 40,000 mt grains time charter equivalent scrubber-fitted - Daily

Recalada-Bejaia 40,000 mt grains time charter equivalent scrubber-fitted MAvg – Monthly

Rotterdam-Aliaga 40,000 mt ferrous scrap time charter equivalent 0.5% VLSFO - Daily

Rotterdam-Aliaga 40,000 mt ferrous scrap time charter equivalent 0.5% VLSFO MAvg - Monthly

Rotterdam-Aliaga 40,000 mt ferrous scrap time charter equivalent scrubber-fitted – Daily

Rotterdam-Aliaga 40,000 mt ferrous scrap time charter equivalent scrubber-fitted MAvg – Monthly

New Orleans-Iskenderun 50,000 mt petcoke time charter equivalent 0.5% VLSFO - Daily

New Orleans-Iskenderun 50,000 mt petcoke time charter equivalent 0.5% VLSFO MAvg - Monthly

New Orleans-Iskenderun 50,000 mt petcoke time charter equivalent scrubber-fitted - Daily

New Orleans-Iskenderun 50,000 mt petcoke time charter equivalent scrubber-fitted MAvg -Monthly

Houston-Krishnapatnam 50,000 mt petcoke time charter equivalent 0.5% VLSFO - Daily

Houston-Krishnapatnam 50,000 mt petcoke time charter equivalent 0.5% VLSFO MAvg - Monthly

Houston-Krishnapatnam 50,000 mt petcoke time charter equivalent scrubber-fitted - Daily

Houston-Krishnapatnam 50,000 mt petcoke time charter equivalent scrubber-fitted MAvg -Monthly

Also, Platts is proposing to start publishing new daily weighted average Ultramax time charter equivalent indexes reflecting Atlantic trade, basis 0.5% sulfur bunker fuel and scrubber-fitted ships and comprising ton-mile rates of the six key TCE assessments, from Nov. 1, 2023. The new indexes will be called AUI 6 and AUI 6S.

The AUI 6 index would be a demand-weighted average of the six key time charter equivalent assessments basis 0.5% sulfur bunker fuel, while AUI 6S would be an average of the same TCE assessments basis scrubber-fitted ships.

These new indexes would reflect an important part of the global dry bulk market that is otherwise not reflected in existing price benchmarks. Ultramax vessels in the Atlantic Ocean typically remain within the region and the associated flows depend significantly on triangulation, which helps to minimize ballast time as well as boost tonnage utilization and earnings.

The new indexes would reflect this important vessel flow that includes the movement of commodities such as grains, scrap and petcoke.

The AUI 6 index assessments for the 63,000 dwt Ultramax class vessel would be derived by applying an allocated weighting to the daily Ultramax TCE assessments of the six key voyages published at 4.30 pm London time. The index assessment would follow the Platts London publishing schedule.

Weighting for the individual TCE assessments would be determined by the volume of Ultramax vessel movements observed between the regions associated with the respective voyages in the last three years from Commodities at Sea trade-flow software, calculated in ton-miles.

Ton-mile demand is calculated by multiplying the volume of cargo moved in metric tons by distance traveled in miles.

From Nov. 1, 2023, the weighting for the average TCE assessment would be as follows, based on flows observed over Jan. 1, 2020 to Dec. 31, 2022:

Basis bunker fuel 0.5%	Route Voyage	Weighting (%)
DOP SWP	New Orleans, Louisiana to Kashima, Japan	18.2%
DOP SWP	Houston, Texas to Krishnapatnam, India	16.4%
DOP SWP	New Orleans, Louisiana to Iskenderun, Turkey	5.8%
DOP Gibraltar	Santos, Brazil to Qingdao, China	27.8%
DOP	Recalada San Lorenzo, Argentina to Bejaia, Algeria	28.2%
DOP	Rotterdam, Netherlands to Aliaga, Turkey	3.6%

Basis scrubber fitted	Route Voyage	Weighting (%)
DOP SWP	New Orleans, Louisiana to Kashima, Japan	18.2%
DOP SWP	Houston, Texas to Krishnapatnam, India	16.4%
DOP SWP	New Orleans, Louisiana to Iskenderun, Turkey	5.8%
DOP Gibraltar	Santos, Brazil to Qingdao, China	27.8%
DOP	Recalada San Lorenzo, Argentina to Bejaia, Algeria	28.2%
DOP	Rotterdam, Netherlands to Aliaga, Turkey	3.6%

Please send all feedback, comments or questions by October 4, 2023. to shipping@spglobal.com and pricegroup@spglobal.com.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing.

Platts will consider all comments received and will make comments not marked as confidential available to the public upon request.