Baltimore channel unlikely to boost dry bulkers

Market: Coal, Freight
01/04/24

The temporary channel that will be opened at the Port of Baltimore around the collapsed Francis Scott Key Bridge will be far too shallow to move large vessels and provide support to dry bulk freight rates.

The planned channel will be 11 ft deep (3.35m) and too shallow for the three types of vessels primarily responsible for transporting coal out of Baltimore. Supramaxes, Panamaxes and Capesizes have minimum drafts of 12.8m, 14.43m and 18.2m, respectively, and accounted for 87pc of the 19.94mn t of coal shipped from Baltimore in 2023, according to global trade analytics platform Kpler.

The channel is being built for "commercially essential" vessels, according to the federal Unified Command overseeing the removal of the collapsed bridge, which will include ships involved in the salvage operations.

If coal exporters do try to use smaller vessels to move their cargoes it would likely be on smaller barges, which would mean coal exports would continue to be heavily restricted.

The suspension of traffic depressed rates last week, especially for Capesizes and Panamaxes. The cost of coal-laden Capesize vessels transporting cargo from the US east coast to Rotterdam declined by $3/t to $12.90/t from 25-28 March, according to Argus data. Panamaxes traveling along the same route fell by $1.40/t to $13.90/t during the same period.

By Gabriel Squitieri

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19/03/25

US' China ship fees would boost costs, not shipbuilding

New York, 19 March (Argus) — The US Trade Representative's (USTR) proposal to fine Chinese-built ships calling on US ports would cripple trade flows and increase costs for US consumers rather than promote domestic shipbuilding efforts, according to comments from shipping industry participants. Comments filed earlier this month from US industries that rely on shipborne cargo were critical of the USTR plan to fine owners of Chinese-built vessels between $500,000 and $1.5mn per port call, saying it would disrupt trade flows and increase US consumer costs . In more recent filings, the American Association of Port Authorities (AAPA), shipbrokers and major shipping associations, among others, echoed those concerns, calling on the USTR to reconsider its proposal ahead of a public hearing the USTR will host on 24 March. The AAPA commended USTR's goal of revitalizing the US' domestic maritime industry, but warned that the proposed fine on Chinese-built ships would not have a positive impact on US shipbuilding efforts. "The fees will do little to grow the American shipbuilding industry, which needs major infusions of capital, workforce talent and innovation to begin competing with shipbuilders abroad," the AAPA said. Existing shipyards in the US are working at or near capacity, so higher demand will not enable them to produce additional ships with the "same number of resources", according to AAPA. The proposed fines would disrupt the efficient and cost-effective flow of essential goods to the American cities and industries, shipbroker Lightship said in its comments to the USTR proposal. "If the US were to tax Chinese vessels, then Japanese vessels and shipyards would be the directly benefited party, not the eventual US shipyards," the shipbroker said. A $1mn fee on Chinese vessels calling on US ports would be an effective $20/t surcharge on the 50,000t-sized cargoes common in the Supramax dry bulker segment that delivers critical cargoes to the US, Lightship said, such as the rock salt that de-ices roads along the US east coast. "The salt producer and seller will subsequently raise the price per ton of salt to offset these higher freight costs," Lightship said. Fees on Chinese vessels would split the global freight market into US-focused and US-avoidant shipping segments, according to major international shipping agency BIMCO, while the additional costs would be "passed on to the US consumer". "The totality of the world fleet would not change, but the overall cost of maritime trade would increase due to less competition in the now segregated US market," BIMCO said. "In this regard, it is worth keeping in mind that the US import/export is about 12pc of global seaborne trade, so the consequences of reorganizing maritime trade will have a much bigger impact on US import/export than on trade in the rest of the world." The threat of the proposals being instituted under US president Donald Trump's administration contributed to a nearly 20pc increase in freight rates last week for dry bulk vessels loading out of the US . The rise was notable for early signs of a bifurcation developing in US exports, as vessel operators without Chinese vessels in their fleet submitted higher $/d offers for US-loading cargoes compared to operators utilizing Chinese vessels in their fleet. By Charlotte Bawol Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Turkish lira at all-time low against dollar

19/03/25

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19/03/25

Turkish lira at all-time low against dollar

London, 19 March (Argus) — Turkey's lira currency fell to record lows against the US dollar today, after the arrest of Istanbul's mayor provoked concern about instability. The depreciation could cause imports of dollar-denominated commodities to become more expensive, although reaction was mixed across markets. The lira went as low at 40/$1 in early trading, from below 37/$1 on Tuesday 18 March, before easing to around 38/$1 later in the day. The lira has been slowly depreciating against the dollar for many years, but the sharp fall today came after Ekrem Imamoglu, one of President Recep Tayyip Erdogan's main political rivals, was held on suspicion of corruption and aiding a terrorist organisation. Turkey is a significant importer of natural gas, crude and LPG, as well as coal and petcoke, although demand for many commodities will be muted currently because of the Islamic fasting month of Ramadan. Early indications from the coal and petcoke markets were that all import trades had halted as the lira hit the record low. In polymers markets the focus is on whether demand recovers after Ramadan ends on 30 March. But a trading source in Turkey said the fall is not enough for "massive changes" to imports of oil products. The OECD forecasts headline inflation in Turkey at 31.4pc this year, the highest among its members, easing to 17.3pc in 2026. The IMF has forecast Turkey's economy will grow by 2.6pc this year, after an expansion of 2.7pc in 2024. By Ben Winkley, Aydin Calik, Joseph Clarke, Amaar Khan and Dila Odluyurt Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Indonesian coal producers wary of proposed royalty hike

19/03/25

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19/03/25

Indonesian coal producers wary of proposed royalty hike

Manila, 19 March (Argus) — Indonesian coal producers have raised concerns on a proposed royalty hike by the country's ministry of energy and mineral resources (ESDM). The proposal is ill-timed given an extended sluggishness in coal prices and the impact of recent government regulations, the Indonesian Mining Association (IMA) said. The industry is still navigating the regulatory changes announced in February and a higher royalty will impact revenues, IMA said. Exporters of national resources, including coal but excluding oil and gas, are required to place 100pc of the foreign currency proceeds into a special deposit account of a national bank for at least 12 months, starting on 1 March. This marks a significant increase compared with the initial regulation, which required exporters to place only 30pc of the foreign currency proceeds onshore for three months. Jakarta also approved a decision in February to link coal exports to HBA , a government set reference price, starting from 1 March. Coal prices have been steadily declining since 2024, which has significantly pressured margins, prompting many producers to keep output flat in 2025 and focus on ways to increase efficiency and reduce costs. A higher royalty could lead to lower coal production, IMA said. Coal producers prepare their Work Plan and Budget (RKAB) based on current coal royalty rates, it said. A change in royalty might necessitate a review of these plans since the validity period for the RKAB is three years. The ESDM first announced its plans to increase royalty rates in the first half of March. Coal royalties could be increased by 1 percentage point for producers holding business permits (IUP) for GAR 5,200 kcal/kg or lower coal products when the HBA is at or above $90/t. This would result in GAR 4,200 kcal/kg or lower coal having a new royalty rate of 9pc from the current 8pc. Coal with a higher calorific value (CV) than GAR 4,200 kcal/kg up to GAR 5,200 kcal/kg would have a new royalty rate of 11.5pc, up from 10.5pc. Royalties from coal with a higher CV than GAR 5,200 kcal/kg would remain unchanged at 13.5pc under the proposed revision. Coal Contract of Work (PKP2B) holders will retain their 13.5pc total tariff rate across all coal grades, as the 1 percentage point increase in royalty rates will be offset by a 1 percentage point decrease in mining receipt shares, the ESDM said. The increase was proposed to raise non-tax state revenue collections from the mining industry. By Antonio delos Reyes Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Groups to sue Alliant over Iowa coal ash discharge

18/03/25

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18/03/25

Groups to sue Alliant over Iowa coal ash discharge

New York, 18 March (Argus) — Three environmental groups intend to sue Alliant Energy subsidiary Interstate Power and Light, alleging that groundwater discharges from the Ottumwa coal plant's coal ash impoundment in Iowa violate the Clean Water Act. The groups — the Iowa Environmental Council, Sierra Club, and Environmental Law & Policy Center — filed a formal notice to sue the utility on 12 March, initiating a 60-day period for the company to respond and comply with the Clean Water Act. The environmental groups claim Ottumwa has continued to release groundwater with arsenic and other toxic pollutants into the Des Moines River through a drain under the plant's lined coal ash pond despite being told by Iowa regulators in 2023 that such releases were not allowed under the plant's stormwater permit. The utility also has not applied for a new permit since the Iowa Department of Natural Resources mentioned the issue, the groups claim. "We want the unpermitted pollution to stop," said Environmental Law & Policy Center senior attorney Josh Mandelbaum. "We will evaluate any response by the utility, but if there continues to be unpermitted pollution, we intend to act." Alliant said that it is abiding by all regulated and required groundwater monitoring processes. The company "proactively" reached out to the Iowa Department of Natural Resources about the permit and has been "actively communicating" with the department while "systematically working" toward a solution for the groundwater discharge. "The system under the landfill is engineered so the groundwater does not come into contact with the contents of the landfill," the coal plant operator said in its statement. Still, environmental groups insist that "a solution has not been implemented and Alliant continues its unpermitted discharge". The Ottumwa coal plant received 1.27mn short tons (1.15mn metric tonnes) of coal from four Wyoming mines in 2024, according to the most recent US Energy Information Administration data. By Elena Vasilyeva Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Australia's New Hope boosts coal output in Aug-Jan

18/03/25

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18/03/25

Australia's New Hope boosts coal output in Aug-Jan

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