In International Shipping News 19/10/2016
Bunker operations at Hong Kong remain halted Tuesday due to strong wind conditions from Typhoon Sarika, trade sources said.
“The No. 3 [strong wind] signal is still in place, so there are no loadings [from terminals] at this time,” a source said.
“The Hong Kong Observatory has been saying they will consider taking it [No. 3 signal] off later today since early morning, but it is still No. 3 for now,” the source said.
The Hong Kong Observatory had raised the No. 3 warning — which denotes wind speeds of 41-62 kilometers/hour — Monday afternoon.
In its latest update Tuesday, the department said it would “consider issuing the ‘strong monsoon signal’ to replace the strong wind signal No. 3” when Typhoon Sarika moves further away from Hong Kong or weakens overnight.
A trader said there was little clarity on when bunkering operations could resume at Hong Kong with sea conditions still choppy.
As of Tuesday afternoon, wind levels were heard at Force 7, which the Hong Kong Observatory categorized as strong winds of 52-62 km/hour.
“The market is always tighter for a day or two after a stoppage like this. But how badly it is affected depends on how long it takes for operations to resume,” a source said, adding berth congestion and tight barge availability could be expected.
PRICES
“Prices have been supported and it is likely to be maintained,” a trader said.
Another trader agreed, saying prices for some prompt bunker fuel deliveries or spot inquiries might firm due to the halt in operations.
“I believe most suppliers cannot do prompt inquiries, as they need to clear the backlog,” a source said, adding buyers who required prompt bunker volumes would need to be prepared to pay more.
But another trader said it was unlikely bunker fuel prices would be affected. “But physical operations will likely be jammed, so suppliers may not offer as actively,” he said.
Looking ahead, traders said the Hong Kong bunker fuel market was already readying itself for the next typhoon — Haima — with Hong Kong lying in the direct path of the typhoon this time. Hong Kong was expected to experience the full impact of Typhoon Haima on Friday.
“At the moment, the earliest delivery [for bunker fuel] I think is October 20/21, but another typhoon is coming, so who knows what will happen,” a trader said.
At the Asian close, 380 CST bunker fuel for delivery at Hong Kong was assessed down $5/mt to $288.75/mt, S&P Global Platts data showed, with the fall bucking an overall rise of $2/mt seen for 380 CST bunker fuel available at other regional ports also assessed by Platts.
The fall was led by selling activity seen during the North Asian bunker fuel Platts Market On Close assessment process, with Sinopec Hong Kong Fuel Oil leading the charge.
The trader started off offering $296.75/mt for 500 mt of 380 CST bunker fuel for delivery at Hong Kong over October 22-25, with Chimbusco Pan Nation eventually lifting its offers at $289.75/mt and $288.75/mt.
Sinopec Hong Kong Fuel Oil declined to offer on following the second trade with Chimbusco Pan Nation.
Source: Platts
