Dry bulk: USGC Supramax market in limbo as participants assess Harvey impact


Activity in the US Gulf Coast Supramax market was stilted this week, as participants grappled with the repercussions of Tropical Storm Harvey, after the US Coast Guard set port condition Zulu for Louisiana port Lake Charles and Texas ports Beaumont, Nederland, Orange, Port Arthur, Port Neches, Sabine and Sabine Bar late Monday.

Port condition Zulu closes ports to all vessel traffic when gale-force winds are expected to arrive within 12 hours.

With several key factors still unknown, including the duration of the port closures, the impact on the infrastructure around the ports, and the extent of the cargo volumes lost, participants were still trying to tease out the ramifications of the storm mid-week.

Many have been adopting a wait-and-see approach before rating new business, one ship operator said, adding that they themselves intend to “play it safe until we really understand what’s going on.”

The Houston Ship Channel remained closed Wednesday to incoming and outgoing traffic but there was talk of opening some areas within 24-48 hours.

Hurricane Harvey all infrastructure map

“We just don’t know yet,” a dispatcher said, after a morning meeting of the Port Coordination Team. “We are waiting for the Coast Guard to give an all clear.”

A first trickle of activity was seen Wednesday, with the Lalis D, 55,000 dwt, heard fixed at $13,000/d to Norden for a petcoke trip from the US Gulf Coast to the East Mediterranean with early September dates, and the Ocean Tianbao, 63,700 dwt, heard fixed around $20,000/d to K-Line basis delivery Mobile September 10-15 for a grains trip to Japan.

But with the picture muddied for the coming fortnight “the markets have not really moved this week…they are all staying flat (even the forward market) at the moment,” a shipbroker said.

The Houston to Krishnapatnam petcoke route basis 50,000 mt and New Orleans to Kashima grains route, same basis, were assessed at $33/mt and $37.75/mt respectively Wednesday, flat on market indications.

On the cargo side, sources estimated 200,000-500,000 mt of petcoke production had been lost, including stocks washed away by the floods, raising questions as to how demand from India and the East Mediterranean will be met.

These delayed/lost cargoes could result in increased petcoke flows out of Colombia due to limited Saudi supply, sources said, or alternatively see petcoke moved via rail from Chicago to the US East Coast, and exported from there.

With voyage durations from the US Gulf Coast to India ranging between 45-50 days depending on whether vessels opt to route via the Suez Canal or the Cape of Good Hope, Indian buyers will need to move quickly to secure petcoke supplies for mid-October dates if port access is further delayed.
Source: Platts 

Previous Next

We Have Increased & Enhanced Our Global Presence: Mr. Suresh Sinha, MD, IRClass

View More Videos



View All Albums