Platts to launch Ultramax dry bulk TCE assessments for 3 Asia-Pacific routes Nov 1

S&P Global Platts will launch time charter equivalent (TCE) assessments for Ultramax class dry bulk ships on three routes -- Australia to Vietnam, Indonesia to China and Persian Gulf to India -- effective Nov. 1, 2021, to reflect growing thermal coal exports from Australia and Indonesia and increasing limestone shipments from the Persian Gulf on the respective routes.

These TCE assessments reflect the gross daily revenue of Ultramax vessels operating on these routes. They will be published in US dollars/day and will be derived from the respective Supramax voyage rates published by Platts on a $/mt basis.

Platts first proposed the launch of these TCE assessments in a subscriber note published Aug. 30.

Ultramax and Supramax vessels typically compete for similar sized stems as both vessel classes reflect geared and grabbed ships, and Platts understands there is increasing interest to utilize Ultramax vessels, compared with Supramax vessels in the dry bulk freight market, given the larger cargo carrying capacity and lower fuel consumption.

By the end of 2021, Platts Analytics expects 1,177 Ultramax vessels to be on the water as compared to just 444 vessels in 2015. A further 96 Ultramax vessels are currently in the order book to be delivered over the next three years. By comparison, there are currently 2,088 Supramax vessels on the water, with only 28 more of these in the order book to be delivered in the next three years, according to Platts Analytics.

The proposed TCE assessments will be calculated using bunker prices published by Platts.

With the introduction of new sulfur limits in marine fuel by the International Maritime Organization from Jan. 1, 2020, Platts will publish two sets of TCEs for each route: one for scrubber-fitted vessels reflecting the use of 3.5% sulfur marine bunker fuel, and one for non-scrubber fitted vessels reflecting the use of 0.5% sulfur marine bunker fuel.

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 new assessments are:

Ultramax TCEs basis bunker fuel 0.5%

Ultramax TCEs basis bunker fuel 3.5%

The new prices will be assessed basis the Asia market close at 5:30 pm Singapore time (0930 GMT), and will follow the Singapore publishing schedule.

Please send all comments or questions to shipping@spglobal.com and pricegroup@spglobal.com.

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