China's abysmal weather disrupts barging schedules, bunker demand at ports

Strong winds from the Bohai Sea continues to disrupt barging operations at several Chinese ports including that of Zhoushan and Shanghai, tightening barge availabilities and slowing bunker fuel demand as prevailing unfavorable weather conditions are likely to continue until the week ending March 1, market sources said Feb. 22

According to local bunker suppliers, the bad weather began in the week of Feb. 13 but conditions deteriorated this week.

The availability of both low sulfur and high sulfur fuel oil bunkers remain sufficient, market sources said, while demand for both grades were sluggish due to the ongoing Lunar New Year holidays, causing bunker premiums to ease from January.

At China's key bunkering hub of Zhoushan, strong winds have caused delays in barge operations, with some local bunker suppliers noting the cancellation of orders.

Local bunker suppliers added that while some were able to supply both bunker fuel grades whenever there was a slight improvement in weather conditions in the past few days, moving forward, the situation required close monitoring.

"The strong winds in Bohai have stopped ships' movements," a China-based bunker trader said, adding that this affected operations at both Zhoushan and Shanghai ports.

Wind speeds ranged between 50 km/h and 88 km/h Feb. 21, according to data from Zhoushan Marine Meteorological Research Center, which forecast the gale to continue at speeds of 88 km/h into the week ahead.

Local bunker suppliers are awaiting instruction from the local port management office on the possible closure of the anchorage.

Over at the Port of Hong Kong, a local bunker trader said strong winds at Zhoushan will usually result in bunker demand at the Chinese port to shift to Hong Kong. However, on this occasion, demand was muted due to the Lunar New Year festivities with many "factories not operating until last Sunday [Feb. 18]."

Platts assessed the premium for Zhoushan-delivered marine fuel 0.5%S bunker fuel over benchmark FOB Singapore Marine Fuel 0.5%S cargo assessments at a monthly average of $35.31/mt until Feb. 21, a 16.9% decline from January average of $42.49/mt, S&P Global Commodity Insights data showed.

The premium was assessed at $19.56/mt Feb. 21, up 21 cents/mt, or 1.09% day on day.

At the Port of Yangshan in Shanghai, bunkering was conducted at berth due to the strong winds at the port. Furthermore, a local bunker supplier said loadings at where he was located in Shanghai was cancelled for the past couple of days due to the poor weather.

The impact of the bad weather conditions at China's northern ports was limited as "most of the vessels had bunkered at berth", a Hong Kong-based bunker trader said.

According to market participants, the strong winds have also shut China's smaller ports like the Port of Huanghua and the Port of Tianjin.

Like other ports, bunker fuel demand at these ports were slow due to cancellation of orders amid deplorable weather conditions, while supply of both low and high sulfur bunker fuel grades remain adequate, with bunker suppliers able to supply on a prompt basis; subject to weather conditions.

Platts assessed the premium for Shanghai-delivered marine fuel 0.5%S bunker over benchmark FOB Singapore Marine Fuel 0.5%S cargo assessments at an average of $45.02/mt to date in February, a 20.11% decline from the January average of $56.35/mt, S&P Global data showed.

The premium was assessed at $25.56/mt Feb. 21, down $3.79/mt, or 12.91% day on day, the lowest since Nov. 2, 2023 when it was assessed at $22.55/mt.