50th Week Topic: Drought in Brazil Reduces Grain Exports, Leading to Significant Changes in the Regional Distribution of Panamax Bulk Carriers

HiFleet has reported that Brazil's grain exports to China in 2023 increased by 28% on the basis of 2022, mainly because of the severe drought in the Mississippi River that year, resulting in changes in regional grain exports. Brazil's main food crop is soybeans, which are grown in the states of Mato Grosso (26%), Parana (15%), Rio Grande do Sul (14%), Goias (10%), Mato Grosso do Sul (8%).

However, there are new changes in 2024, and there are constant reports of drought in Brazil in September 2024, because as the soybean planting season approaches, traders are concerned about whether the drought will affect the progress of soybean planting in Brazil and thus affect its regional production. As Brazil enters July 2024, some 16 Brazilian states and the Federal District of Brasilia are facing the worst drought in 44 years, and the drought has lasted for 12 months in some areas. Brazil's Amazonas state issued a notice, saying that 20 of its 62 cities have declared a state of emergency due to the prolonged drought.

In 2024, the worst drought in Brazil's history inhibited its regional grain exports, and the shipping market Panamax bulk carrier route Santos to Qingdao route Panamax bulk carrier quantity and freight rates declined significantly. According to HiFleet shipping data show that in mid-September in the north and east of South America Panamax bulk carriers waiting to load grain ships there are 153 ships, the latest quarter waiting to load Panamax bulk cargo ships have been decreasing, there are less than 90 Panamax bulk cargo ships intended to load grain, down more than 46%. Big Data shows that more grain shipments are moving to Australia, with Panamax bulk carriers to Australia increasing from less than 90 in September to more than 120 now, a 39 percent increase in capacity. These data can be viewed through the HiFleet shipping big Data platform, and the HiFleet weekly report in the platform community can clearly see these trends in the distribution of capacity. At present, the Brazilian port of grain is still exported, but because of the regional drought production, the grain transport volume of 60,000 tons on the Santos-Qingdao route has dropped sharply from $38 per ton in October to $33 per ton in November, down 13% from the previous month.

Changes in the shipping market can be seen through the trend of the distribution of shipping capacity. Simply put, it is just like bees are always willing to go to places with more flowers to collect honey. When the shipping capacity swarms, it indicates that the market there is more favorable to shipowners; on the contrary, when the shipping capacity gradually decreases, it indicates that the market there is declining and more and more shipowners are unwilling to go there.

51th Week Topic: Baltic Dry Index Falls Below 1,000 Points for the First Time Since July 2023

On December 19, 2024, due to the continued weakness of Capesize bulk carriers, the Baltic Dry Index fell below 1,000 points to 976 points for the first time since July 2023, a 59% drop compared with the high of 2377 points on March 11, 2024.

As the unexpected dry bulk cargoes continue to stumble in the fourth quarter, more dry bulk shipowners in the market have planned to take advantage of the market downturn to arrange dry dock inspections as early as possible or move dry bulk vessels to the Atlantic, where competition is slightly relaxed, and market panic is spreading.

The current maritime market is not only the dry bulk cargo see the fall, should have been due to the winter favorable energy transport tanker market has also plummeted, car transport is plunging 40% situation, container ship transport market is also because of the new US government's trade protection and tax policy expectations and always shrouded in shadow, lingering. All this makes the shipowner's eager heart become delicate and begin to feel uneasy, and the idea of selling the ship arises.

According to the analysis in the field of dry bulk carriers alone, the deadweight ton growth rate of the dry bulk fleet is basically maintained at about 3% from 2022 to 2025, which is a healthy growth level. The land volume level of the number of ships dismantled in successive years should be an obstacle to the renewal of market capacity. According to hiFleet shipping big data shows that the number of dry bulk vessels has reached more than 13,600, more than 1 billion deadweight tons, and the fleet is developing towards large-scale and modernization. Due to the extremely hot shipping market caused by the epidemic, the dismantling scale of old dry bulk vessels has been delayed. From 2021 to 2024, the basic dismantling scale is within 60 ships, except for 91 ships in 2023, while the normal historical dismantling number is in the hundreds. If the market continues to be depressed for several months, it is foreseeable that the ship breaking market will become active in 2025.

A sharp decline in the number of breaks has hampered the health of the dry bulk fleet, which has increased in fleet age from an average of 10.3 years to the current 12.2 years. The new shipbuilding scale of dry bulk cargo accounted for the proportion of the existing fleet size from 7.3 percent in 2021 to 9.9 percent in 2024, and the new shipbuilding scale showed an increasing trend year by year. Dry bulk second-hand ship sales have been very active in the past three years, there are more than 700 second-hand ship sales records, historical data records normal transaction records of second-hand ships are generally at the level of 400. The market continues to emerge new dry bulk ship investors, the market presents a situation, there are a lot of good capital, they almost empty their hands of shipping capacity. The investment of ships is like the investment of the stock market, full operation requires courage, and waiting for the opportunity to empty positions shows its investment wisdom.

Overall, long-term leases for dry bulk in 2024 increased by 23% compared to 2023, matching the 28% corresponding increase in the Baltic Dry Index. The unexpected weakness of the dry bulk market in the fourth quarter of 2024 was influenced by a number of factors, the first of which should be the volatility of international trade, while the market is pricing in the resolution of the Red Sea crisis ahead of time.

52th Week Topic: The New Shipbuilding Market is Booming in 2024

2024 is an extraordinary year for the new shipbuilding market, according to hiFleet statistics shows that shipowners spent more than $155 billion on new shipbuilding at the shipyard in the first three quarters alone this year, which is more than double the 10-year average shipbuilding level, and high value-added new shipbuilding orders increased significantly, which is the highest level since 2008. By the end of December 2024, the number of new shipbuilding orders worldwide exceeded 5,000, with more than 280 million deadweight tons, an increase of 14% compared to 2023.

In addition to the general optimism that the shipping market will continue to be healthy in 2024, the International Maritime Organization will further promote the shipping carbon reduction policy, and the update rhythm of the world's fleet will accelerate significantly. Because of the rush of shipowners, it is difficult to find an earlier berth to deliver the ship, especially for some types of new shipbuilding, and the delivery time is generally lagging behind. The combination of high new shipbuilding prices, main engine capacity constraints, and uncertainty about the choice of alternative green ship fuel technologies in the future has curbed the flood of new shipbuilding to some extent.

The well-known Red Sea factor has caused a large number of containers to bypass the Red Sea, and the overall container freight market in 2024 is running at a high level, which leads to the container new shipbuilding orders in 2024 remaining very strong, with a total of 870 container new shipbuilding orders and 6.8 million TEU. The high yield of the tanker market also continues to attract new capital to join the ranks of tanker investment, tanker new shipbuilding orders almost doubled in 2024, from 350 in 2023 to more than 10,000 DWT tanker new shipbuilding orders this year to 650. Shipowners who have been investing in bulk cargo have also increased their investment in dual-fuel bulk carriers, with the number of new shipbuilding orders for bulk carriers increasing from more than 1,100 in 2023 to more than 1,300, accounting for 10% of the total bulk fleet. LNG carriers continued their strong growth in 2023, with new shipbuilding orders continuing to set new highs, reaching a capacity of 342 vessels and more than 5,700 units in 2024. The fastest growth in orders in the field of new shipbuilding may also belong to car carriers, which have only 44 orders in 2022, and increased 163% to 116 orders in 2023. In 2024, new orders for car ships have reached 190, an increase of 331% compared with 2022. The corresponding number of parking Spaces exceeded 1.48 million, an increase of 3.9 times compared to the 300,000 parking Spaces in 2022.

On the whole, 2024 is a market in which all types of ships are robbing the berth. According to hiFleet shipping big data analysis, since 2010, the peak value of new shipbuilding price index appeared in September 2024 at 189.96 and continued to be strong, while the recent historical trough value appeared in March 2017 at 121.38. The difference between the highest value and the lowest value is 68.58, and the peak value increases 36.1% compared with the valley value. The new shipbuilding market and the second-hand ship market interact with each other. Since 2010, the highest value of the second-hand ship price index appeared in July 2022 at 213.07, then fell sharply but rebounded quickly, and the lowest value appeared in November 2016 at 75.1, the difference between the peak value and the trough value was 137.97, and the peak value increased by 183.72% compared with the trough value. The shipping market is a volatile and cyclical industry, and the mentality of shipowners also follows the ups and downs of the market, and the capital invested in shipping is sometimes suffering and sometimes full of confidence.

1st Week Topic: Memories of Shipping in 2024 Still Fresh

Shipping ushered in a New Year, several happy several worries, shipping in the past year of 2024 is generally good, from the hot new shipbuilding market to the high operating container shipping market, as well as the growing development of shipping big data service enterprises HiFleet, in this industry can also make different roles to find satisfaction. This weekly report does not intend to study the shipping market or the future direction of the shipping market, but to talk about some light topics at the beginning of the New Year, and take stock of what will be memorable in 2024.

The first thing I want to talk about is the Red Sea. Since the war between Israel and Hamas broke out in October 2023, the Houthi armed group has threatened the security of shipping in the Red Sea and the Gulf of Aden. In February 2024, the Houthis sank for the first time a 27-year-old handybulk carrier, the 32,200-DWt RUBYMAR, operated by the Lebanon-based GMZ Ship Management Company, after the fertilizer on board melted into the sea. A marked increase in Houthi attacks in the Red Sea in June 2024, the most active period in 2024, resulted in the sinking of two more vessels, a Greek owner's 82,000 DWT bulk carrier, which was also hit by a drone bomb on the port side; Another Ukrainian general cargo ship, the Verbena, caught fire after a Houthi missile attack while westbound in the Gulf of Aden. The fire was uncontrollable, forcing the crew to abandon ship, and the ship sank shortly after.

Then there was the impressive container ship crash on an American bridge. On March 26, 2024, Americans woke up to learn that the Francis Scott Key Bridge had been destroyed by a 9,962-seat container ship. Grainy footage of the accident shows the bridge collapsing like a cartoon building block after the collision. The ship, owned by Grace Ocean, managed by Synergy Marine and operated by container shipping giant AP Moller-Maersk, was chartered after the accident in which six people died and it took months for normal passage to resume.

The third is the shooting at the shipowner's office on February 12, 2024. A gunman in his seventies went on a shooting rampage at the offices of European Navigation, an owner of refined oil tankers controlled by the Karnessis family, killing three people, Among them were general manager Antonius Varasakis and Maria Canassis, sister of family leader Spiros Canassis. The gunman, a former employee of the family whose body was also found in the building, was reported to have committed suicide.

The fourth impressive incident was a bizarre ship collision. On Friday morning, July 19, 2024, a 74,000 DWT tanker owned by Hafnia burst into flames in the South China Sea after colliding with a VLCC. The 300,000 DWT VLCC supertanker, built in 2001, also caught fire. Shockingly, the VLCC fled the scene, as the vessel may have been involved in shadow tankers transporting sanctioned oil, and the vessel was seized by Malaysian maritime authorities three days later, and the VLCC was sanctioned by the US in December. Driven by profits, the shadow tanker transport of oil products has grown to the size of hundreds of ships, while the Marine environment is always at great risk due to its lack of safety supervision and insurance arrangements.

Then there is the booming new shipbuilding market in 2024, in which investment shipowners are grabbing the earlier berth of the ship. According to HiFleet statistics, shipowners invested more than $155 billion in new shipbuilding in 2024 in the first three quarters alone, which is more than double the 10-year average level of shipbuilding, and high value-added new shipbuilding orders increased significantly, the highest level since 2008.

2nd Week Topic: Chinese Shipping Giant Appears on Pentagon's List

The 45th week of 2024 market weekly, hiFleet reported that on November 6, 2024, the United States election that attracted worldwide attention finally settled, the Republican Trump defeated the Democratic Harris by a clear advantage to obtain the 47th president of the United States, and in 2016, Trump also defeated Hillary Clinton and was elected the 45th president of the United States. Donald Trump's victory in the US presidential election ushered in his presidential 2.0 era. The shipping community is most concerned about what impact Trump will have on the world shipping market. At that time, we logically focused on the future development trends of the container market, the energy transportation market and the Red Sea issue. As expected, the United States insisted on the United States as the center to introduce a variety of major policies conducive to the development of American shipping, and even resorted to suppressing other countries' shipping to quickly achieve its economic interests, and geopolitics has always been volatile and uncertain.

On January 7, 2025, China Cosco Shipping, the world's largest shipowner, was targeted by the US government for its alleged links to the Chinese military, while oil giant CNOOC was also on the Pentagon's list. In a filing with the Federal Register, the state-owned Chinese company Zhongyuanhai appears on a list of "military enterprises," which is determined by the Pentagon.

According to the media description of the list is a "blacklist", but it is different from the OFAC list, does not mean that it has been included in any sanctions or export control list, will not have an impact on the relevant maritime business and ship operations. However, the purpose of being on the list is to prevent American companies from having financial dealings with these companies. Possibly as a result, Cosco shares fell 4.4 percent in Hong Kong trading on Jan. 7, outperforming the city's benchmark stock index.

In 2019, Cosco was sanctioned by the United States for shipping Iranian oil, causing VLCC rates to soar, but those sanctions were lifted in 2020. The market believes that the impact of the Pentagon list on the crude oil and shipping markets will be small, but it should still have some positive impact on the current shipping market. Cosco's overall fleet of more than 1,000 vessels covers all major sectors, including very large container ships, bulk carriers, oil tankers, general cargo vessels, etc., far ahead of the number two MSC Mediterranean Shipping Co., which has about 770 vessels. The list is likely to have an impact on the container shipping market, as North American container imports account for about 20% of the global container volume, China accounts for 35% to 45% of the North American container volume, and trans-Pacific trade is the largest container route in the middle and Far seas.

Oil giant China National Offshore Oil Corporation (CNOOC) and ship owner Sinotrans, which has a huge fleet of tankers and bulk carriers, are also on the list. Cnooc has two onshore shale oil and gas projects in the U.S., two deepwater projects and interests in several other exploration blocks in the U.S. Gulf of Mexico, according to Bloomberg Intelligence data. The company said in a report late last month that rising tensions with Washington could lead it to reassess its ownership of the assets. The inclusion of China State Shipbuilding Corp., the world's largest shipyard, and some of its affiliates on the list surprised the shipbuilding community, a move that could raise U.S. shipping costs.

Beijing firmly opposes the US Department of Defense's listing of Chinese companies legally operating on the list, and urges the US side to immediately stop the wrong practice and will take necessary measures to resolutely safeguard the legitimate rights and interests of Chinese entities.

3rd Week Topic: Strong northeast monsoons in the South China Sea led to the sinking of two ships

It was a busy weekend for Singapore's maritime authorities, as monsoon rains and winds battered Southeast Asia, sinking a general cargo ship and a small oil tanker and setting fire to another product tanker, putting maritime safety officials in Southeast Asia on high alert. 

The first vessel to sink, the Vietnamese-flagged 7,900 WT general cargo vessel DOLPHIN 18 (built in 1999), was hit by high winds and waves on the night of January 10 and sank on the morning of January 11 about 274 nautical miles (507 km) southwest of Vung Tau, Vietnam. According to the Maritime and Port Authority of Singapore, the ship sent a distress signal at 7:00 am (2300 GMT) on the 11th, when it received a response from a 30,000 DWT container ship Nicolai Maersk (built in 2000), according to hiFleet shipping Big Data. Nicolai Maersk was about 20 nautical miles from the vessel, en route from Guangzhou to Singapore. The DOLPHIN 18 was carrying 18 Vietnamese crew members. Nicolai Maersk rescued the 18 crew members from the lifeboat in time, but the ship sank and the 18 crew members will disembark at the Malaysian port of Tanjong Pellepas. A container ship with weather navigation provided by hiFleet at the time was more than 200 nautical miles away. Recently, the South China Sea has been affected by the Northeast monsoon, hiFleet advised ships to sail close to the east coast of Vietnam or the west coast of the Philippines to avoid large waves. 

According to the Maritime and Port Authority of Singapore (MPA), the second vessel to sink was the Malaysian-flagged 1,200-DWT tanker Silver Sincere (built in 1987). The Silver Sincere sent a distress call to the Maritime and Port Authority of Singapore on the afternoon of January 12, when it was in Singapore's territorial waters near Pedra Branca with eight crew members on board. The MPA directed Teguh Persada Kencana's Indonesian-flagged 12,000 DWT cargo ship Intan Daya 368 (built in 2013) to rescue the crew, who were scheduled to be transported to Batu Ampar, Indonesia. Meanwhile, vessels of the Republic of Singapore Navy and Singapore Police Coast Guard soon entered the search and rescue phase and deployed salvage tugs and oil spill response vessels. According to hiFleet ship archives, Silver Sincere is owned by CCK Capital Malaysia and operated by Klang-based bunker Player Peninsula Marine. 

Early on the morning of January 12, 2025, the Mongolian flagged 7,700 DWT product tanker EAGLE 1 (built in 1995) caught fire in southeast Tanjung Biai, causing the Malaysian Maritime Enforcement Agency (MMEA) to launch a search and rescue operation. Malaysian Coast Guard vessels and tugboats were dispatched to extinguish the fire on the Mongolian-flagged tanker. The tanker belongs to the Emir Van Kor Oil Company of the United Arab Emirates. The fire was brought under control later that day and no oil leaks were found. MMEA said 14 crew members of EAGLE 1, including Burmese, Indonesians and Singaporeans, were evacuated to shore by a coast guard vessel. Another member of the boat's crew, an Indonesian citizen, drifted into Singapore waters and was later found unconscious and taken to hospital for further treatment. 

According to hiFleet meteorological big data tracking, the monsoon is caused by the strengthening of the North Asia high pressure system, which brings a strong northeast monsoon to the South China Sea, please pay attention to the safety of navigation in relevant waters.

6th Week Topic: HIFLEET 2024 Dry Bulk Shipping Data Statistics

The Baltic Dry Index BDI in 2024 averaged at 1749 for the whole year in 2024, up 27% compared with 2023; The average of the Capesize index BCI for the year was 2712, up 38% year on year; The Panamax Index BPI averaged 1564 points, up 9% year on year; The BSI average for 2024 was 1240 points, up 21% year on year. 

In 2024, the world shipped 1.618 billion tons of iron ore (excluding mixed ore re-exports), an increase of 2.6%. Among them, Australian iron ore shipments were about 965 million tons, an increase of 20 million tons, or 2%, compared with the same period in 2023; Brazilian iron ore shipments were 386m tonnes, up 30m tonnes, or 8 per cent. In the same year, the total amount of Chinese iron ore shipped to the port by sea was 1.244 billion tons, an increase of 40 million tons, or 3%. The biggest increase was in May, when imports rose 10% from a year earlier.

In 2024, the global shipping volume of coal will be 1.3 billion tons, which is basically the same as that in 2023. Among them, Indonesia shipped 464 million tons, an increase of 3%, Australia shipped 355 million tons, a slight decrease of 3 million tons, Russia shipped 159 million tons, a decrease of 10%, the main problem is that Russia's east-bound railway capacity is limited. In the same year, China imported 437 million tons of coal by sea, an increase of 24%. From the perspective of seaborne import sources, imports from Indonesia were 224 million tons, up 43 million tons year-on-year, imports from Australia were 82 million tons, up 47% year-on-year, and seaborne coal from Russia was 69 million tons, down 6% year-on-year.

In 2024, 190 million tons of bauxite have been shipped by sea, of which 132 million tons shipped by Guinea. China's bauxite seaborne imports increased significantly by 12% year-on-year to 158 million tons, accounting for 83% of the global bauxite seaborne trade volume.

In 2024, the global shipping volume of bulk grain is 431 million tons, an increase of 15% over the same period in 2023; Brazil shipped 159 million tons, a decrease of 5%, mainly due to the historic drought restricting the efficiency of Brazilian inland barge operations; The US shipped 101m tonnes of bulk grain by sea, up 23 per cent from a year earlier. China's bulk grain seaborne imports in 2024 totaled 154 million tons, an increase of 16% over the same period in 2023; Although affected by the drought, China's import of bulk grain from Brazil increased by 14.5 million tons, accounting for 68% of the increase in China's bulk grain imports by sea, which is thanks to Brazil has become China's largest source of corn imports. 

In 2024, the average ballast speed of Capes, Panamax, Supramax and handysize are 11.14 knots, 11.25 knots, 11.31 knots and 11.10 knots respectively, down 1.5%, 3.1%, 2.7% and 2.4% compared with 2023, respectively. The ballast speed of large ships continued to operate at a low level, and decreased slightly; After entering the second half of 2024, the average ballast speed of each ship type fleet continued to decline, especially the Panamax fleet. 

According to HIFLEET's port congestion data, based on the analysis of the ship congestion data of the main export regions of coal, iron ore and grain (Australia, Brazil, the United States Gulf and Indonesia), the overall congestion situation in 2024 is improved compared with the same period in 2023, and the annual port compaction level is stable. From the point of view of the waiting time of these four port groups, the average daily waiting time of dry bulk carriers (Capesize + Panamax + Supramax) is 137 hours, which is 13 hours less than the average daily waiting time of 150 hours in 2023.

The situation of China's port pressure in 2024 also improved, and its dry bulk cargo fleet (Capesize + Panamax + Supramax) has an average daily number of 295, down 14% compared with 2023 (including the situation that all medium and large ships are required to leave the port for shelter when typhoon hit; In 2024, there were 30 typhoons in the Northwest Pacific, 10 more than in 2023). 

In 2024, the two main routes for China's iron ore imports have a small extension of the voyage cycle, and after entering the third quarter, the Capesize has a significant speed reduce operation. The two main routes of China's coal import have shortened the voyage cycle by one day, but the voyage of the East Australia return route is relatively stable, and the voyage of the Indonesia return route is more volatile in 2024. Bulk grain import main route Brazil - China ship voyage period maintain stable; The voyage of the US-China route is affected by the navigation conditions of the Panama Canal, which has been extended by 4 days compared with 2023.

7th Week Topic: HIFLEET 2024 Liquid Bulk Shipping Data Statistics

In 2024, the crude oil fleet totaled 2,318 vessels with a combined capacity of 461 million deadweight, an increase of 2% over the same period in 2023; A total of 16 new vessels (1 VLCC, 9 Suezmax, 6 Aframax) were delivered during the year, with a cumulative capacity of 2.41 million DWT. There are 808 LNG carriers in the world, with a total capacity of nearly 122 million cubic meters, an increase of more than 8%, of which 69 new ships will be delivered in 2024. There are 428 VLGC (65,000 cubic meters and above) in the world, with a total capacity of 36.11 million cubic meters and 23.51 million deadweight tons.

The 2024 crude oil sea freight index BDTI fluctuated downward, recording an annual average of 1092 points, down 5% from 2023; By ship type, the VLCC annual TCE average of 37,565 US dollars, an increase of 65% compared with 2023, Suez and Afra TCE average of 38,067 US dollars and 39,499 US dollars, respectively, down 22% and 12%.

In 2024, the BLNG average recorded 5,103, down nearly 50% from 2023.

The BLPG index fell 49% overall in 2024, falling to a low from January, and hovering narrowly around 5000; The average annual freight rate of BLPG's representative route, Middle East - Japan, is 62 USD/ton, which is 43% lower than the average of 2023 (109 USD/ton).

In 2024, the global seaborne trade of crude oil (between different countries) will total 2.224 billion tons, which is basically the same as that in 2023. Saudi Arabia, affected by production cuts and increased demand for its own fuel, has seen its crude oil exports decline, down 4% from 2023. Crude oil seaborne exports from both the United States and Russia weakened in the second half of 2024, but the total volume for the year was little changed, with the United States rising slightly by 1% and Russia only decreasing by 850,000 tons. Brazil's seaborne crude oil exports rose 1 percent, and its crude oil exports are likely to surpass those of soybeans and iron ore.

In 2024, China's seaborne crude oil imports of 538 million tons, the average monthly import volume decreased by 1.87 million tons compared with 2023, down 4% year-on-year, fully demonstrating that China is accelerating its energy transformation.

Since the outbreak of the conflict between Russia and Ukraine, the global natural gas trade pattern has begun to reshape, and the LNG trade volume has begun to expand, but the same period in 2024 and 2023 is basically flat, and the global LNG shipment volume remains at 396 million tons; Among them, the LNG shipment volume of the United States is 88.56 million tons, the first in the world, and the growth rate is more than 7% compared with 2023. Australia and Qatar saw small increases of 3.1 million tons and 1 million tons, respectively.

According to HIFLEET data, a total of 78.19 million tons of LNG will be imported from China's mainland in 2024, up more than 9% from 71.53 million tons in 2023. LNG receiving stations such as Huizhou and Chaozhou will be put into operation one after another in 2024, and China's LNG receiving capacity will explode.

According to HIFLEET statistics VLGC voyage data analysis, in 2024, the global LPG shipment 87.61 million tons, down 9% from the same period last year; However, the United States bucked the trend and increased LPG exports by nearly 9% from 2023, mainly due to the resumption of traffic levels in the Panama Canal.

China's customs data (liquefied propane + other liquefied butane) shows that the import of liquefied petroleum gas in 2024 is 34.57 million tons (estimated imports in December are 2.42 million tons); HIFLEET data statistics, in 2024, China's VLGC to the port a total of 901 times (less than 2023, 97 times), a total of about 33.13 million tons of unloading, accounting for more than 95% of China's total LPG imports.

8th Week Topic: Global Tankers May Face Supply Tightness Again

According to the plan being developed by European countries, the shadow fleet of tankers will face the fate of mass seizure, because recently the Nordic and Baltic countries are studying new ways to stop the flow of Russian oil, the method on how to large-scale seizure of shadow fleet tankers carrying Russian oil is planned, and the supporting legislation is also being drafted.

And in early February the United States imposed tougher sanctions on Iran, blacklisting shipowners, managers and a VLCC captain for links to the "shadow" tanker fleet.

The move also adds three tankers to the sanctions blacklist, including two accused of shipping Iranian crude stored in China out of the country, which became new targets of sanctions.

The new sanctions confirm the widely held view in the market that U.S. President Donald Trump will act decisively to pressure Iran to curb shipments of Iranian crude to China.

Large and growing amounts of Russian and Iranian oil are stuck on tankers around the world as Western sanctions continue to hamper cargo shipments. Oil prices and freight rates are rising due to a lack of suitable vessels, while a growing number of Chinese and Indian refiners are reluctant to take crude from blacklisted vessels. According to statistics, 57 percent of the 126 VLCCS that export Iranian crude oil to China have been sanctioned by the United States. Iran's floating reserves grew by 10 million to 20 million barrels in 2025, the highest level in at least 12 months, with about 80 percent of these floating reserves coming from Singapore and Malaysia.

The tanker market forecasts that due to the overall tightening of sanctions against the shadow tanker fleet, the world may need more than 150 VLCCS with clean backgrounds to meet market transportation demand. The logic behind the lack of tankers in the market also has a cargo demand side to it, with the industry facing a big trigger point as the supply of ships looks "increasingly tight" with a combination of rising crude production and sanctions. According to tanker market rumors, an additional 156 VLCCS may be needed by 2026 to cope with the increased demand to transport crude oil on mainstream vessels. The market is also saying that there is more than 150 VLCC demand growth potential in the near term.

VLCC rates have doubled in early 2025, but investors continue to show a lack of enthusiasm for tanker stocks, despite last week's increase in most tanker rates. Frontline, the tanker leader, closed down 5.7% on the New York Stock Exchange on last Friday, the biggest drop among its peers last week. In the latest week, VLCC spot prices rose 13.5%, for a variety of reasons, including sanctions, increased demand for cargo transport factors, of course, behind the economic interests are also closely linked.

9th Week Topic: Trump Administration's Threat to Significantly Increase Port Fees for Chinese Ships Shakes Shipping Market

Previously, Washington's reforms had had only indirect effects on the shipping industry. Now, US President Donald Trump's lieutenants are taking direct aim at the shipping industry and arguing that it should pay more taxes to reduce taxes on Americans. First, Commerce Secretary Howard Lutnick proposed wide-ranging tax reforms that would crack down on foreign-flagged ships calling at U.S. ports.

The Trump administration has proposed imposing steep fees on Chinese-owned or built ships calling at U.S. ports: $1 million per call for Chinese-owned ships and $1.5 million for Chinese-built ships operated by non-Chinese companies. The move could have a serious impact on the global shipping industry, especially container shipping, and ripple through China's shipbuilding industry.

The surprising breadth of the various trade sanctions proposed by the Trump administration against Chinese ships has raised questions about how far the tariffs could reach the shipping sector. Does a ship operated by a Chinese company and built in a Chinese shipyard have to pay this double fee when calling at the same port? Do container ships on liner lines have to be delivered at every stop at a U.S. port? Will a subsidiary registered in Hong Kong be considered a Chinese company? With every proposed measure since Mr. Trump's trade whirlwind swept the world, a question must be asked: It is a negotiating tactic.

The negative news hit shares in Singapore-listed Yangzijiang Shipbuilding, which is listed on the Singapore Exchange's main board and has fallen for several days.

Chinese Shipping giant Cosco Shipping, on the other hand, is embarking on a new multibillion-dollar shipbuilding spree. The shipping giant ordered about 100 new ships last year and is now asking about prices and delivery dates for more than 70 different ship types.

The impact of Trump's threats on the shipping industry and China's shipbuilding industry could be far-reaching, and if implemented, the high fees would push up shipping costs, forcing shipping companies to adjust routes or reduce their dependence on US ports, potentially leading to less efficient global supply chains. Some shipping companies may turn to non-Chinese vessels to avoid fees, triggering a reallocation of capacity and causing market disruption in the short term. China's shipbuilding industry has long cast a shadow, and ship investors may reduce orders for Chinese-built ships due to concerns about additional costs, weakening China's competitiveness in the global shipbuilding market.

If the United States does not unilaterally impose fees through the WTO dispute mechanism, it may violate Articles 1 (most-favoured-nation treatment) and 3 (national treatment) of the General Agreement on Tariffs and Trade (GATT). The International Maritime Organization (IMO) does not authorize member states to unilaterally impose such fees, and the United States needs to prove that its measures are consistent with the "port state sovereignty" exception in the United Nations Convention on the Law of the Sea (UNCLOS), but it needs to avoid discriminatory application. Invoking the "National security exception" (GATT Article 21), subject to proof that Chinese ships pose an actual threat to the United States, could be seen as trade protectionism.

In the face of the confused logic of America first, China may first file a lawsuit at the WTO, and jointly pressure affected parties such as the EU and ASEAN to ask the United States to withdraw its discriminatory policies. At the same time, China will also impose tariffs or restrict access to US shipping or related industries, increasing relevant costs for the US side. China can also strengthen shipping cooperation with other countries through the Belt and Road Initiative and reduce its dependence on the US market. At the same time, China will further upgrade the shipbuilding industry, accelerate the upgrading of shipbuilding technology, increase the proportion of high-end ships, and enhance international competitiveness.

The US move, if implemented, would disrupt the global shipping order and hit China's shipbuilding industry, but its legal basis is weak and it could face challenges under international law. China needs to adopt a combination of legal, economic and industrial policies to safeguard its own rights and promote multilateral negotiations on global trade rules.

10th Week Topic: Global New Shipbuilding Market Faces Both Challenges and Opportunities

At the beginning of 2025, the global new shipbuilding market showed a significant structural adjustment. According to market new shipbuilding data, the global new shipbuilding orders in the first two months of 2025 plunged 65% year-on-year (3.84 million CGT compared with 11.11 million CGT in the same period in 2024), reflecting the contraction of market demand and cautious investment by shipowners. While the new ship price index remains at an all-time high (188.36), some ship types have eased, such as LNG carriers and VLCCS (very large crude carriers), which have seen price declines of several million dollars, and demand momentum has weakened.

There are several key factors affecting the medium and long-term development of the new shipbuilding market. First, maritime environmental protection regulations force the updating or upgrading of ship manufacturing technology, IMO 2030/2050 carbon emission targets and EU carbon tariffs (ETS) promote shippers to accelerate the elimination of old ships, and green ships (LNG dual-fuel, methanol, ammonia power, etc.) become the core investment direction. Secondly, the transformation of ship power energy and trade reconstruction, the transformation of global energy structure to low carbon (natural gas, green methanol, hydrogen energy, ammonia energy, wind energy), superimposed the geopolitical trend of supply chain regionalization, reshaping the shipping demand structure. Shipping is also characterized by cyclical fluctuations. The concentrated delivery of new ships from 2023 to 2024 leads to excess capacity of some ship types (such as container ships), which inhibits the demand for new orders. However, in the medium and long term, as the dismantling of old ships accelerates, the demand for fleet renewal will be gradually released.

In the medium and long term, the ship types that suffer the biggest impact on the new shipbuilding market are those traditional fuel ships and some excess ships. VLCC (very large crude oil carrier), due to the acceleration of the global energy transition, the growth of crude oil shipping demand has slowed down, and the excess of existing capacity has led to a sharp decline in new ship orders. In February 2025, the price of new VLCC vessels fell by 2.3% month-on-month, and it is expected that the price will further correction in the future. Very large container ships (22,000 to 24,000 TEU) are also at risk of overcapacity, with orders concentrated after 2024 during the pandemic, east-west trunk line capacity saturated, and shipowners turning to small and medium-sized feeder ships or environmentally friendly vessels. Existing large container ships are difficult to meet future zero-carbon fuel compatibility requirements, and shipowners are in a wait-and-see mood. In the medium and long term, ship operation is restricted by carbon emission regulations, and ship owners are more inclined to invest in LNG dual-fuel or methanol-powered bulk carriers, and the order space of traditional ship types is squeezed.

The potential growth areas for new shipbuilding in the future include green ships and segments. LNG carriers, short-term price correction does not change long-term demand. Growth in global gas trade, particularly in Asia, and floating storage demand (FSRU) support order resilience. Methanol dual-fuel vessels, the first shipping company has ordered a batch of methanol powered vessels, which have both environmental compliance and fuel availability, becoming the mainstream choice in the bulk and container ship market. * Vehicle carriers (PCTC) and modular vessels (suitable for multi-purpose transport) have significant potential in the context of regional trade fragmentation due to their high flexibility. Orders for offshore wind power installation vessels (WTIV) will continue to be released in the European and Asia-Pacific markets.

With its cost control ability and the advantages of the whole industry chain, China dominated the field of medium and low-end ships (bulk carriers, feeder container ships) and green ships, accounting for 58% of the orders (90.75 million CGT). South Korea relies on high-technology ship types (LNG carriers, large container ships), but due to price competition and demand fluctuations, the market share has slipped to 23% (36.67 million CGT).

As shipyards, they should focus on green technology research and development, cooperate with energy companies to build fuel supply chains, and promote the digitization of shipbuilding (smart shipyards) to reduce costs. Shipowners may consider prioritizing investments in ship designs that are compatible with multiple fuels, extending the life cycle of their assets, and focusing on the incremental market of regional trade routes. Countries need to increase subsidies for green ships and the construction of port supporting facilities to promote the low-carbon transformation of the industry. The global new shipbuilding market has entered a deep adjustment period, and traditional ship types are facing elimination pressure, while green ships and segments will become the core growth point in the next decade. Chinese shipyards are dominant in scale and cost, and South Korea maintains its competitiveness with technological breakthroughs, and the global market pattern will further evolve in the direction of "environmentally driven and technology-led".

11th Week Topic: Canada's West Coast crude oil exports are likely to go more to Asia in the future

Most of Canada's West Coast crude oil exports still go to the United States after the pipeline is commissioned, but Canada is looking for buyers in Asia because of the recent tariff war between the two countries.

According to market statistics, Canada's West coast crude oil export capacity has increased significantly due to the completion of the Trans Mountain Pipeline expansion (commissioned in June 2024), which has increased British Columbia's export capacity from 300,000 barrels per day to 890,000 barrels per day so far this year. British Columbia's exports totaled 373,000 b/d. Crude oil tanker exports increased 59 percent from last year, with 42 percent of exports going to East Asia. Afra and Panamax tankers have benefited from increased volumes since June 2024, carrying 75% and 25% of Vancouver's volumes, respectively. Panamax ships are mainly exported to the United States, while Afra ships are also exported to Asia and therefore benefit from longer sailing distances.

Although more and more Canadian oil is exported east, the current situation is that most Canadian oil exports are still mainly shipped to the United States by pipeline and rail. After the first trade war scare between the US and Canada in February, it was assumed that Canadian sellers would either split costs with US buyers or look for new buyers in the Far East. Those tariffs, along with those on Mexico, were eventually delayed for a month, but went back into effect on March 4.

While the United States remains the main export destination (by pipeline and rail), the share of Asian buyers (such as China and South Korea) has increased significantly. The United States, Canada and Mexico are negotiating tariffs, and the United States has hinted that a compromise deal could be reached to ease tensions.

After this trade war, Canada will accelerate the diversification of crude oil exports, take advantage of the capacity advantages after pipeline expansion, further explore the Asian market with strong demand such as East Asia and India, and reduce its dependence on the United States. The increase in crude oil exports from West Coast ports such as Vancouver will drive demand for Aframax tankers as they are suitable for medium to long haul (such as trans-Pacific routes). If the US-Canada tariff dispute eases, land exports to the US may pick up slightly; If there is a stalemate, Canada can maintain its market share in Asia through price cuts and long-term contracts. Canada could become a stable supplier of medium-heavy crude oil in the Asia-Pacific region, differentiating against U.S. shale oil, but dealing with price pressures from traditional suppliers such as the Middle East and Russia.

12th Week Topic: How Large Is the Actual Demand for Liquefied Natural Gas (LNG) Fuel?

According to hiFleet Shipping Big Data analysis, the number of new LNG dual-fuel shipbuilding contracts has risen sharply since mid-2024, with 264 units ordered last year, more than double the previous year, and LNG bunkering is also gaining some significant demand.

An increasing number of ports offer LNG refuelling, 198 at the latest count. At least seven new orders for LNG fuel resupply vessels were placed in the first two months of this year, accounting for half of the total orders for the whole of 2024.

Recently, Wanhai Shipping said that the container ships planned to use methanol will be converted to liquefied natural gas fuel, which involves a $240 million budget. The liner, which is prepared to pay more than $30m per vessel to upgrade the new vessels to LNG dual-fuel vessels, is the latest liner to choose LNG as a fuel instead of methanol, following well-known companies such as AP Moller-Maersk and Evergreen. The scarcity and high price of green methanol have been cited as reasons for the shift by liner companies from methanol to LNG.

In the future, the development of global Marine fuel will show a parallel trend of diversification and cleanliness, in which liquefied natural gas (LNG) and its derivative biological LNG (liquefied biomethane) occupy an important position as a transition fuel.

LNG has been widely used in dual-fuel ships due to its perfect supply chain and mature technology. Compared to conventional fuel oil, LNG can reduce CO2 emissions by 20%, while bio-LNG (made from organic waste) can reduce emissions by 92%. The global number of LNG-powered vessels has increased from 62 in 2015 to 471 in 2023, and the proportion of LNG dual-fuel vessels in China's new shipbuilding orders has increased significantly.

Hong Kong and other shipping hubs have recently completed "ship-to-ship" LNG bunkering operations, marking the improvement of regional bunkering networks. Relying on the industrial base and policy support, China's coastal areas have become the core areas for the manufacturing and renovation of LNG dual-fuel power vessels.

With IMO sulfur emission limits (less than 0.5% sulfur from 2020) driving demand for low-sulfur fuels, and policies such as EU carbon tariffs further strengthening LNG's transitional position, the LNG path may be the only option currently available to achieve the 2050 emissions reduction target at scale.

Methanol, with its similar properties to diesel, has become the first choice for conversion of dual-fuel vessels. By the end of 2024, the number of methanol fuel ships on global orders reached 322, far exceeding the 27 for ammonia fuel. Maersk and other companies have started the methanol power conversion of a number of container ships, investing more than $120 million.

Although ammonia can achieve zero carbon emissions, engine technology, safety standards and filling networks are not yet mature. The world's first ship-to-ship ammonia fuel transfer test was successful in 2024, but large-scale application is still 5-10 years away.

China accounted for 74.7% of the world's new ship orders, and Hyundai Shipbuilding promoted the production of LNG dual-fuel power ships; Europe has led the way with stringent environmental regulations, such as the European Union's emissions trading System.

In the next ten years, the global ship fuel will show a pattern of "transition fuel scale and zero carbon fuel pilot". LNG and bio-LNG dominate the medium-term market with their existing advantages, while fuels such as green methanol and ammonia need to break through technical bottlenecks and supply chain constraints. Regional policy differences, corporate strategic choices and international cooperation will be the key variables for industry transformation. As a shipbuilding country, China needs to strengthen investment in green fuel technology and innovation in financial instruments to grasp the opportunities of global shipping decarbonization.

13th Week Topic: Mediterranean Sulfur Oxide and Particulate Matter Emission Control to Be Officially Enforced on May 1 This Year

According to the resolution adopted at the 79th meeting of the IMO Environmental Committee MEPC, the Mediterranean Sea is officially designated as a Sulfur oxide (SOₓ) and Particulate Matter (PM) Emission Control Area (SECA). The amendment to be adopted on 1 May 2024 and to be implemented 16 months after its adoption (i.e. 1 May 2025) in accordance with the default procedure of the MARPOL Convention. Mediterranean SECA was established to reduce the sulphur content limit of Marine fuel oil in the region from 0.50% to 0.10% of the global standard, in order to reduce air pollution and health hazards.

The core amendment to MARPOL Annex VI adds the Mediterranean Sea as a Sulphur Oxide Emission Control Area (SOₓ), requiring ships to use fuel oil with a sulphur content of 0.10% or less, or equivalent emission reduction measures (such as the use of scrubbers) within this area. At the same time, Particulate Matter emissions are included in the particulate matter emission control at the same time, or technology or fuel equivalent to SOₓ (such as LNG, hydrogen fuel) is adopted. Ships are required to mark the suitability of SECA on the IAPP Certificate (International Air Pollution Prevention Certificate) and submit the EGCS (Exhaust Gas Cleaning System) technical document to the flag State for approval.

The Mediterranean Area covers the entire Mediterranean Sea, including the territorial seas, exclusive economic zones and international waters of the Mediterranean littoral states, from the Strait of Gibraltar (longitude 5°36'W) in the west, to the Dardanelles Strait in Turkey (longitude 26°11'E) in the east, and to the coastlines of Italy, France, Croatia and other southern European countries in the north. South to the coastlines of North African countries (Libya, Tunisia, Algeria), excluding the Black Sea and the Red Sea south of the Suez Canal.

All international vessels of 400 gross tonnage and above (including passenger ships, container ships, oil tankers, bulk carriers, etc.) are subject to the implementation. The exceptions are military vessels, non-commercial government vessels, or ships in distress or emergency refuge (which require written instructions to the port State afterwards), or ships in pilot projects approved by the IMO (such as ammonia fuel test ships).

Ships must use VLSFO (very low sulfur fuel oil) or MGO (Marine light diesel oil) with sulfur content ≤0.10% in SECA; The use of alternative fuels such as LNG and methanol is permitted, provided that the safety requirements of the IGF Code are met; Ships with open, closed or hybrid scrubbers must ensure that discharge water complies with MEPC.259(68) (pH≥6.5, turbidity ≤25 FNU). Before entering SECA, the ship shall complete the fuel switching and record the switching time, position and tank stock in ORB Part I; The switching operation must be completed at least 4 hours before entering SECA to ensure that the fuel system is fully clean. The ship has updated IAPP certificate, indicating the suitability of SECA, and retains the BDN and representative samples for at least 3 years, and the sample should be marked with sulfur content ≤0.10%; Ships fitted with scrubbers are required to hold an EGCS Certificate of Conformity and monthly emissions monitoring record.

Seafarers generally do SECA boundary identification and electronic chart (ECDIS) area warning and reminder; Make fuel switching operation, scrubber start and stop process and fault response plan (such as the scrubber needs to switch the compliant fuel within 1 hour after shutdown); Emission data recording and reporting standards (e.g. the EU MRV mechanism). The ship shall have the corresponding emergency plan, including the formulation of countermeasures for equipment failure, fuel supply interruption and other scenarios, and there is an emergency fuel supply agreement signed with the fuel supplier in the corresponding area.

14th Week Topic: The Multidimensional Impact and Structural Transformation of U.S. Tariff Policies on the Global Shipping Market

As a core participant in global trade, the United States accounts for about 11% of the global share of international trade, and has a significant advantage in the field of high value-added services. However, the new tariff policy announced by the Trump administration on April 2 is like a heavy blow, directly impacting the commodity trade and global shipping market. This policy not only led to a sharp decline in shipping stocks on the US stock exchange, but also caused the Baltic Dry Index (BDI) to fall for eight consecutive trading days, hitting a new three-week low (1540 points). An expected cooling of demand from China, the world's largest consumer of iron ore, has added to market concerns.

Tariffs drive up the cost of imports, forcing rapid adjustments in global trade chains. International flight operators have cancelled about 10 per cent of scheduled flights on major east-west routes in April in an attempt to stem spiralling freight rates by cutting capacity. In the five weeks between the end of March and May 6 alone, 68 of 713 scheduled flights were canceled. At the same time, the escalation of Sino-US trade frictions has made liquefied petroleum gas (LPG) a focus, and China has imposed tariffs on US LPG exports, directly impacting the earnings of relevant routes.

Supply chain fragmentation is becoming more and more obvious. To avoid U.S. tariffs, some Asian exporters are shifting production capacity to countries such as Vietnam and Mexico, lengthening container shipping routes and pushing up fuel costs along with freight rates. Morgan Stanley analysis pointed out that Vietnam and other countries have also been imposed tariffs, apparel, footwear and other industries that rely on low-cost supply chains will face greater pressure.

Despite the obvious short-term headwinds, major Greek shipowners believe that the tariff policy may force global trade to become more efficient, thus creating structural opportunities. For example, the reconfiguration of trade routes may increase the demand for short-haul transport within the region, driving the transformation of the dry bulk market to a high-frequency, small-volume model. If the United States stimulates domestic infrastructure through tariffs, it may drive domestic demand for commodity transportation, but it needs to be supported by policy clarity.

In the long term, supply chain regionalization (such as nearshore outsourcing) is accelerating. The rise of manufacturing in Mexico is likely to increase demand for container transport in the Americas, while the dry bulk market needs to adapt to diversified supplies of iron ore, coal and other resources. In addition, policy uncertainty could curb global container traffic growth in 2024, but short-term rates could rebound now if companies stock up early to avoid tariffs.

Shipping giant Maersk bluntly said the tariff policy is "not good news" and the container market is facing greater uncertainty in an already volatile trade environment. The contradictory nature of Trump's policy goals also adds to the confusion in the market - both trying to increase government revenue through tariffs and hoping to promote industrial repatriation, but falling imports may reduce tariff revenue. Morgan Stanley sees the April tariffs as more of a bargaining chip, with subsequent exemptions (such as the US-Mexico-Canada agreement) softening the impact, but policy swings will continue to weigh on market sentiment.

History suggests that if U.S. stocks continue to fall (such as the S&P 500 falling below 5,500), unemployment rises or inflation gets out of control, Trump could compromise before the 2026 midterm elections. In his first term, he adjusted trade policy in response to economic pressures, a similar dynamic could be repeated.

The impact of the US tariff policy on the shipping market presents the characteristics of "short-term negative and long-term differentiation" : The dry bulk market is the most directly affected by the demand for bulk commodities, and it needs to pay attention to the change of Chinese demand and the rise of alternative supply chains; The container market depends on the flexibility of supply chain reconstruction, short-haul routes and regional transportation may become a new growth point; The tanker market is more dominated by geopolitics and less correlated with tariffs.

The future course of policy will depend on economic data and political jockeying. Investors need to pay close attention to the progress of tariff exemptions, the Fed's policy linkage and global trade volume repair signals. The resilience of the shipping industry will be tested in this round of shocks, and those companies that can quickly adapt to trade restructuring and optimize capacity allocation may take the lead in the change.