I like Ships too

The Rena was carrying 1,368 containers and about 1,700 metric tons of fuel oil, according to maritime officials.


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New Zealand salvage teams are preparing to pump fuel from a container ship stranded off the nation’s northeast coast as leaked oil from the damaged vessel spreads to 60 kilometers (37 miles) of coastline.

Officials are attaching four platforms to the port side of the stricken vessel to assist fuel recovery, according to a Maritime New Zealand statement. No fuel is likely to be pumped from the ship today, the statement said, as thousands of volunteers seek to clean up the region’s beaches.

Calmer seas allowed inspectors to board the vessel yesterday, after strong winds and high waves forced them ashore Oct. 11. Cracks have appeared in the hull of Athens-based Costamare Shipping Co.’s stricken Rena, raising concern the ship may split, nine days after it ran aground in the Bay of Plenty near Tauranga, 100 miles southeast of Auckland.

“We have a long road ahead of us, so must ensure we maintain our maximum capability and capacity to respond,” National On Scene Commander Nick Quinn said in a statement earlier today.

The vessel has probably spilled as much as 350 tons of oil, and 88 containers are now in the water, with some contents reaching the shoreline, according to Maritime New Zealand. There was no evidence of fresh oil leaks today, the agency said.

The Rena was carrying 1,368 containers and about 1,700 metric tons of fuel oil, according to maritime officials. The ship is owned by Daina Shipping Company, a unit of Costamare.

Dead Birds
About 220 metric tons of waste has been cleared from beaches, Maritime New Zealand said. Oil has washed up on about 60 kilometers of coastline, ranging in severity, and at least 1,000 dead birds have been found.

More than 3,000 people have registered to help clean Tauranga beaches, according to the statement. Teams are also being trained and positioned in areas where oil is expected to wash up within days.

“To the people of Tauranga, we want to say that we are deeply sorry for the situation that has arisen and the threat you are now facing from fuel oil from the vessel washing up on the beaches in your beautiful part of the world,” Diamantis Manos, managing director of Costamare Shipping, said in an e- mailed video statement yesterday.

“It is our ship that went aground and we apologize without hesitation for what has happened,” Manos said, adding that the company will cooperate with all investigations.

The ship’s master and the second officer in charge of the navigational watch have both been charged under the Maritime Act for operating a vessel in a manner causing unnecessary danger or risk, the maritime agency said in a statement.

Seized Equipment
New Zealand officials interviewed crew on duty during the accident and seized recording and navigation equipment to help determine how the vessel settled on the Astrolabe Reef, according to a statement on the Transport Accident Investigation Commission’s website. The inquiry’s final analysis may not be ready until the middle of 2012, the statement said.

The cost of the disaster may exceed the maximum under the shipowner’s insurance, Prime Minister John Key told Radio New Zealand yesterday. The government will pick up any extra costs and will explore legal options to get more compensation, he said.

The cargo on the 32-year-old, Liberian-flagged Rena includes four containers of ferrosilicon, a solid substance that can be hazardous when in contact with water and can emit hydrogen, according to Maritime New Zealand.


http://www.bloomberg.com/news/2011-...ces-strong-winds-as-oil-blackens-beaches.html

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Record liquefied-petroleum-gas shipments are eroding a glut of the tankers hauling the fuel used in stoves, cars and lighters, driving charter rates to the highest ever at a time when most other ships are losing money.

Seaborne trade in LPGs will advance 7.9 percent to 60.2 million metric tons this year, led by supplies from Qatar, according to Knut Stangebye Olsen of Lorentzen & Stemoco A/S, a shipping consultant. Monthly rental costs will exceed the previous record of $1.27 million by next year’s third quarter, from $900,000 now, said the Oslo-based analyst, a former manager at BW Gas Ltd., the largest owner of the vessels.

The surge in supply is a consequence of expanding natural gas output and oil refining, which produce LPGs as a byproduct. While returns on the biggest ore carriers fell 87 percent in the past three years and owners of some of the largest crude tankers are paying clients to hire their vessels, LPG ship rates almost doubled this year. Gas supply expanding at more than twice the pace of the fleet means analysts anticipate profit at Exmar NV (EXM), an operator of the tankers, will almost double this year.

“We don’t have a lot of vessels available for spot cargoes,” said Diego de Potter, a chartering official at Antwerp, Belgium-based Exmar, whose fleet of 30 ships can hold enough gas to supply China for more than a month. “If you ask me for a charter in six weeks, I will not even bother to give you a freight rate.”

Negative Returns
Costs for spot cargoes on the biggest LPG tankers doubled to $78.25 a ton this year, according to the London-based Baltic Exchange, which publishes assessments for more than 50 routes. LPG includes propane, butane and ethane.

The cost of propane in northwestern Europe, an industry benchmark, averaged $876 a ton this year, on track for the highest annual average in at least three decades, according to data compiled by Bloomberg.

Demand for LPG is strengthening now because consumers are expanding stockpiles before the Northern Hemisphere’s winter begins, said Steve Engelen, the manager of research and projects at Joachim Grieg & Co., an Oslo-based shipbroker.

Returns on capesizes, the biggest ships hauling iron ore and coal, are 50 percent below the five-year average. Global rates on the largest crude carriers are a negative $10,911 a day, compared with a five-year average of $28,429, Baltic Exchange data show. Clients still pay some fuel charges, cutting costs for owners moving ships into regions with better returns.

Orders at Yards
The LPG tanker fleet expanded 0.3 percent this year, compared with 6.3 percent for the biggest oil tankers and 14 percent for capesizes, according to London-based Clarkson Plc, the world’s largest shipbroker. Orders at yards in South Korea, China, Japan and Brazil for new LPG vessels are equal to 10 percent of existing capacity, the smallest ratio of any type of commodity carrier, according to data from Redhill, England-based IHS Fairplay.

While LPG tanker rates rose fivefold since March 2009, they are still only “a little above break even,” said Andreas Sohmen-Pao, the Singapore-based chief executive officer of BW Gas. The company hasn’t ordered new ships for five years and sold its oldest vessels, he said. The average LPG tanker is now idle about 10 percent of the time, compared with 25 percent in the past several years, Sohmen-Pao said.

Economic Growth
The projected jump in rates may be curbed should economic growth slow. The U.S., the world’s biggest LPG consumer, will expand 1.4 percent next year, compared with 1.7 percent in 2011, Goldman Sachs Group Inc. said in a report Oct. 3. The bank had previously expected growth of 2 percent in 2012. China, the second-biggest user, will slow to 8.7 percent in 2012, from 9.3 percent this year, according to the median of 10 economists’ estimates compiled by Bloomberg.

World energy consumption fell 1.5 percent in 2009, the biggest decline in at least four decades, as the global economy endured its worst recession since World War II, data from London-based BP Plc show. Natural-gas production fell 2.8 percent, the most since at least 1970, and oil refining retreated 2.6 percent, the largest contraction since 1981.

The process of extracting natural gas destined for liquefaction yields about 5 percent propane and a similar amount of butane or ethane, according to the Paris-based World LP Gas Association. Liquefied natural gas is produced by cooling gas to about minus 260 degrees Fahrenheit. A barrel of crude typically yields about 3 percent LPGs when it is refined, accounting for about 40 percent of global LPG supply.

Gas Futures
Crude oil traded on the New York Mercantile Exchange fell 6 percent to $85.90 a barrel this year as of 6:14 a.m. today in New York. Natural-gas futures traded on the bourse slid 16 percent to $3.692 per million British thermal units.

Exmar will report net income of $32.3 million this year, compared with $14.1 million in 2010, according to the mean of five analysts’ estimates compiled by Bloomberg. Earnings will expand to $49.7 million in 2012, the estimates show. Shares of the company fell 21 percent this year in Brussels trading, compared with a 32 percent slump in the Russell Global Large Cap Shipping Index of 26 companies.

BW Group Ltd.’s 6.625 percent bonds maturing in 2017 trade at about 94.5 cents on the dollar, according to data on Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. Bonds issued by Overseas Shipholding Group, the largest U.S. operator of very large crude carriers, and maturing in 2018 trade at 75.2 cents on the dollar, the data show.

“It’s the classic combination of basically zero fleet growth with increased demand,” said Wouter Vanderhaeghen, an analyst at KBC Securities NV in Brussels, who has a “buy” rating on Exmar. “This has been one of the poorest shipping segments out there, and they’re finally making decent returns. Everything is there for the stock value to increase.”


http://www.bloomberg.com/news/2011-...pping-as-users-expand-stockpiles-freight.html

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The container industry may be facing half a decade of oversupply that will curb freight rates as shipping lines launch vessels into a global trade slowdown.

The rise in container capacity will exceed demand by as much as 10 percentage points over the next three years, according to Drewry Shipping Consultants Ltd. That gap won’t substantially improve for five years, Neil Dekker, head of container research at Drewry, said in an Oct. 11 interview. Those estimates assume no slump in world economic output.

Global growth will slow this year as “crisis-hit” advanced economies struggle and Europe’s debt woes prove “tenacious,” the International Monetary Fund said last month. An increase in vessels from shipping lines like Copenhagen-based A.P. Moeller-Maersk A/S has helped send freight rates plunging 70 percent since a 2010 peak. On its current course the industry will struggle to turn profitable, said Ross Porter, a Stavanger, Norway-based fund manager at Skagen A/S.

“The market outlook is pretty bleak,” Porter said in an interview. The fund, which has $18 billion under management, owns about 10,000 Maersk shares after cutting its holdings by 20 percent last month. “Given the overcapacity that’s built up in the market, a few years will be required to consolidate the situation.”

Capacity in the container market will rise 29 percent in the three years ending in 2013, according to data from London- based Drewry’s quarterly Container Forecaster report. Demand will grow by as little as 19 percent in the period, it said.

No Layups
There won’t be a “major” improvement in the balance between supply and demand for five years, Dekker said. Ships on the world’s two busiest trade routes, Asia to Northern Europe and Asia to the Americas, are only about 85 percent full at the moment, he said.

“Freight rates are very low,” Dekker said. “It would be logical to lay up vessels, but that’s not really happening.”

The price to transport a full 20-foot container from the biggest Asian ports to European ones fell to $650 in the first week of this month, according to Danske Market’s container index published Oct. 7. That was the lowest spot price in at least two years and compares with a peak of about $2,100 18 months ago.

The fallout from Europe’s deepening debt crisis is showing signs of spreading as far as Asia as policy makers in the euro area fail to persuade investors they can avert a Greek default. Asia faces “severe macroeconomic and financial spillovers” from deteriorating economic outlooks in Europe and the U.S., the IMF said Oct. 13.

Shipping Demand
That means container shipping demand could grow even less than Drewry estimates, Dan Togo Jensen, a transport analyst at Svenska Handelsbanken AB in Copenhagen, said in an Oct. 13 interview. He has a “reduce” recommendation on Maersk shares. Jensen is the top-ranking analyst of the 25 covering the company, according to Bloomberg data.

“Box rates will be under pressure” because the imbalance between supply and demand will persist “for quite some time,” he said.

Container lines have booked orders for new ships for a combined $57 billion, according to an Oct. 11 estimate by Paris- based industry consultant Alphaliner. Over the next four years, new ships will add capacity equivalent to 4.5 million standard 20-foot containers, or TEU, versus today’s 15.2 million TEU, according to Alphaliner.

More Room
Vessels that can haul the equivalent of about 1 million TEU will need to be idled or laid up, the Baltic and International Maritime Council, a Bagsvaerd, Denmark-based shipping trade group, said in an Oct. 13 report.

Ships are being built larger as well. The size of container ships has more than doubled over the past decade. New deliveries this year on average carry 6,100 TEU, compared with 2,900 TEU in the year 2000, Alphaliner said in a Sept. 29 report. The size of the world’s fleet of ships with capacity larger than 8,000 TEU will increase by more than 20 percent annually over the next years, outpacing overall supply growth, Drewry says.

The container operations of Maersk, which carries 15.7 percent of the world’s container capacity according to Alphaliner, more than any other, lost $45 million in the second quarter. It earned $1.1 billion a year earlier, Bloomberg calculations show. The unit may lose money in the rest of the year if freight rates don’t recover, the company said Aug. 17.

Dropping Shares
Maersk shares have lost 31 percent this year. The world’s second and third-largest lines, Geneva-based Mediterranean Shipping Co. and France’s CMA CGM SA, aren’t listed.

CMA CGM has seen the price of its $475 million of 8.5 percent notes due 2017 plunge to 45.567 cents on the dollar since they were sold April 14, according to prices compiled by Bloomberg.

There are some signs shipping lines may reduce capacity by canceling or postponing orders for new vessels, Martin Bo Hansen, a corporate bond analyst at Jyske Bank A/S, said in an Oct. 11 note. Hansen, who’s based in Silkeborg, Denmark, has a “hold” rating on Maersk’s debt.

CMA CGM has no plans to order any new container vessels before next year at the earliest, Chief Executive Officer Rodolphe Saade said Oct. 11. The line was approached by two Chinese shipyards about possible orders for vessels larger than 9,000 containers and declined, Saade said.

Shipping lines are betting demand will catch up with supply sooner than Drewry’s analysis shows. Eivind Kolding, CEO of Maersk Line, said Oct. 5 in an interview broadcast by Danish TV2 News that overcapacity probably will last a year at most. That will still be long enough to put some smaller container lines out of business, he said. Maersk hasn’t announced any plans to cut capacity.

The company declined to comment for this story, in compliance with a self-imposed silent period ahead of third- quarter earnings, due to be published on Nov. 9.

Overcapacity may thin out the industry, with only the biggest companies surviving the pressure on freight rates, Skagen’s Porter said.

“In the long-term I see Maersk coming out as the relative winner,” he said. “They have the financial strength to weather this cycle, which a lot of their competitors don’t.”

http://www.bloomberg.com/news/2011-...th-overwhelming-container-supply-freight.html

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Salvage efforts on a stranded container ship off the northeastern coast of New Zealand have entered a “critical” phase as poor weather conditions prevent officials from pumping oil off the vessel.

Salvagers are assessing conditions today as their efforts to recover oil from the Rena are hampered by strong winds and rough seas, with waves as high as four meters, Maritime New Zealand said in a statement. About 90 metric tons of oil was pumped off the ship before operations were halted Oct. 17.

“We’re in a critical place during the next 24 hours due to the weather,” Andrew Berry, head of the agency’s salvage unit, said in a statement last night. “We have one tug still connected to the stern of Rena ready to respond should the ship break up, with two other tugs on standby.”

Rena, the Athens-based Costamare Shipping Co.’s vessel, is “in a dynamic situation” and a range of response plans were in place should the ship rapidly deteriorate, the statement said. Cracks appeared in the hull last week, raising concern the ship may break apart more than a week after it ran aground near Tauranga, 100 miles (160 kilometers) southeast of Auckland.

The Rena was carrying 1,368 containers and about 1,700 metric tons of fuel oil, according to maritime officials. As many as 350 tons of oil may have spilled from the vessel.

The cargo on the 32-year-old, Liberian-flagged ship includes four containers of ferrosilicon, a solid substance that can be hazardous when in contact with water and can emit hydrogen, according to the agency.

As many as 88 containers have fallen from the ship and almost half of them are empty, it said on Oct. 15.


http://www.bloomberg.com/news/2011-10-18/n-z-oil-salvage-in-critical-phase.html

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trysail said:

Not fun. Not fun, at all. This is one ship that won't be coming home. She is hard on that reef.


Sailboat folk dread the thought of those damn containers floating about submerged and invisible to the eye.

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Johnny_Ray_Wilson said:

An Ohio Class Submerged Ship, Ballistic Nuclear Trident Submarine

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thør said:

AKA, boomer.

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trysail said:

Gnarly ! Way cool !

Few people realize how big those mofos are. At 560', they are equal in length to a Ticonderoga class cruiser. The idea that they can move at 20-25 knots underwater boggles the mind. That's a helluva lot of water to displace.

Seeing the image of a boomer passing underneath a bridge on the way into (as you describe it ) "the Silverdale, WA Submarine Base Bangor. Puget Sound" surprised me for two reasons: (1) it gives an idea of the scale of the damn things and (2) I'm amazed the Navy permitted the existence of a bridge between the Sub Base and the sea. The Navy would not allow the construction of a bridge at the mouth of the Chesapeake Bay out of fear that an attack on it could leave the (former) 2nd Fleet bottled up in Norfolk.

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trysail said:

Gnarly ! Way cool !

Few people realize how big those mofos are. At 560', they are equal in length to a Ticonderoga class cruiser. The idea that they can move at 20-25 knots underwater boggles the mind. That's a helluva lot of water to displace.

Seeing the image of a boomer passing underneath a bridge on the way into (as you describe it ) "the Silverdale, WA Submarine Base Bangor. Puget Sound" surprised me for two reasons: (1) it gives an idea of the scale of the damn things and (2) I'm amazed the Navy permitted the existence of a bridge between the Sub Base and the sea. The Navy would not allow the construction of a bridge at the mouth of the Chesapeake Bay out of fear that an attack on it could leave the (former) 2nd Fleet bottled up in Norfolk.

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Rolando2 said:

A member from '63-'67 on this ship

BUT, I wish I had been on this! Now this is a ship!!

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Ships capable of hauling 4,000 cars across the world’s oceans may make the most money next year since the global recession as production reaches a record and demand from emerging markets swells cargoes.

Shipments will rise 10 percent to 12.7 million vehicles in 2012, more than twice the fleet’s expansion, according to ABG Sundal Collier ASA, an investment bank in Oslo. Rates for the 550-foot vessels will gain 36 percent to $15,000 a day, RS Platou Markets AS estimates. Wilh. Wilhelmsen ASA, Europe’s biggest owner of the ships, will boost profit for at least two more years...

Global car sales will rise 8.5 percent to 80.7 million in 2012, according to researcher JD Power & Associates. Demand is being led by developing nations, which will expand 6.1 percent next year, compared with 1.9 percent for advanced economies, the International Monetary Fund predicts. For owners of car carriers, that means profit at a time when freighters hauling commodities are losing money.

“Who’s buying cars? That’s Brazil, that’s Russia, that’s India, that’s China,”...

...Car carriers will earn an average of $11,000 a day this year and next year’s projected rates would be the highest since 2008...

Maritime Routes
Capesizes, the largest ships hauling iron ore, on average made $12,906 a day this year, below their breakeven of about $20,000, according to data from the London-based Baltic Exchange, which publishes assessments for more than 50 maritime routes. Forward freight agreements, traded by brokers and used to bet on future costs, anticipate rates no higher than $18,575 through 2016.

The largest oil tankers averaged $7,867 a day this year on the Saudi Arabia-to-Japan route, the industry’s benchmark, Baltic Exchange data show. Frontline Ltd., the biggest operator of the vessels, says it needs $29,800 to break even. FFAs indicate rates no higher than $10,475 through 2013.

Returns on ore and oil vessels slumped because of a glut of carriers after rates that were as much as eight times higher in 2008 spurred owners to order new ships.

Existing Capacity
The capesize fleet expanded 50 percent since the end of 2008 and orders at yards are equal to 30 percent of existing capacity, according to data from Redhill, England-based IHS Fairplay. That compares with growth of 11 percent for very large crude carriers and orders at 15 percent. The flotilla of car transports gained 2.4 percent and orders are at 9.7 percent.

Expectations for more car shipments and higher returns for vessel owners depend on economic expansion. The shipping industry handles about 90 percent of global trade, according to the Round Table of Shipping Associations. The IMF sees growth in world trade volumes, a measure of goods and services, slowing to 5.8 percent in 2012 from 7.5 percent this year.

Chinese car sales will rise less than 5 percent this year, below a previous estimate of 10 percent to 15 percent, Dong Yang, deputy head of the China Association of Automobile Manufacturers, said in an interview Oct. 11. Sales in India may advance no more than 2 percent in the 12 months ending March 31, the Society of Indian Automobile Manufacturers said Oct. 10. It was the second cut in the group’s forecast.

Auto Shipments
Car production contracted 3.2 percent in 2009, during the worst global recession since World War II... Vehicle shipments plunged 37 percent to 9.3 million vehicles... Its forecast for shipments of 12.7 million vehicles next year would still be about 14 percent below the total in 2008.

That won’t stop shipping company profits. Lysaker, Norway- based Wilhelmsen will report net income of $133.6 million this year and $201.1 million in 2012, compared with $13 million in 2010...

Luxury Cars
Car carriers are also making more money because of increasing Asian demand for European luxury cars, according to Lars Solbakken, the chief executive officer of Oslo-based Norwegian Car Carriers ASA. While vessels previously would sometimes return to Asia empty after delivering cars to Europe, they are now picking up more cargoes for the return leg...

China imported an average of 51,233 cars a month this year, almost three times more than in 2009, according to SEB Enskilda. European-made vehicles account for 73 percent of the total.

“Car sales in emerging markets such as Eastern Europe, Middle East and China continue to grow,” ...“Seaborne cargo from particularly Japan and Korea into these markets will continue to support car carriers.”



http://www.bloomberg.com/news/2011-...global-demand-as-shipping-slumps-freight.html

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Johnny_Ray_Wilson said:

The famed Enterpise, AKA "The Big E"! The world's first nuclear powered aircraft carrier. She was the first of many, many things. And the 8th US ship to carry that name. Lots of combat at sea.

On a separate note. Did you know she was the namesake inspiration for Rodenberry's Star Trek TOS? His initial idea for Star Trek came from his tour onboard a submarine.

I would not want to own the Christian. But I would love to spend a week or so on that old beauty!

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CrackerjackHrt said:

excellent read: http://www.johnmcphee.com/looking.htm

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Kybele said:

is that anything like Steaming to Bamboola? I loved that book.

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CrackerjackHrt said:

it's probably a little drier and a little better written.

not to dismiss buckley--he's funny and a good read--but mcphee is a master story teller.

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