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Astronger tanker market over the course of the past few weeks, has helped increase prices for tankers as well. In its latest weekly report, shipbroker Gibson said that “amidst widespread price increases, it is not surprising that tanker asset values have also been rising. Our data shows a strong appreciation in VLCC and Suezmax values, with a significant divergence between newbuild and second hand price increases. Even more interesting is the difference in growth rates between newbuilds and 5 year old vessels and older 10 and 15 year old tonnage. Gibson asset value data shows newbuild VLCC and Suezmax values both increased by 5% respectively YTD, whilst over the last 12 months they increased by 17% and 13%. This has been driven by rising raw material costs, shrinking yard availability and relative pricing of other vessel types such as container carriers. Although, these increases have likely been capped by a lack of actual ordering given the difficulty in securing both yard slots and design hesitation. With overall producer price inflation averaging approximately 8-10% across most advanced economies, newbuild prices have also felt the pressure but the rate of increases this year may be slowing compared to gains we saw in the second half of 2021”.

Source: Gibson Shipbrokers

“However, it is a very different story in terms of second hand tankers, prices have increased much faster, with 5 year old VLCCs and Suezmaxes jumping by 17% and 23% respectably YTD, reflecting relative value compared to newbuild vessels. For example, the order price of a VLCC is estimated to be $120 million versus $85 million for a 5 year old unit, which offers a comparatively good ratio of youth and prompter availability; with more favourable retrofitting economics compared to a newbuild vessel at a much higher price and with a longer lead time”, Gibson said.

According to the shipbroker, “perhaps the most interesting asset price developments have been in the 10 year old and older age bracket, where gains have far exceeded broader measures of inflation. The biggest gains have been in 15 year old Suezmaxes which have jumped an impressive 58.5% this year, whilst 10 year old VLCCs have increased 20.5%. This has been driven by increased enquiry from mostly Middle Eastern, Russian, and Asian buyers, looking to build a fleet of older tankers to carry Russian crude. Such price rises also offer an attractive asset play opportunity for owners looking to dispose of older units ahead of a potentially tougher sales environment once EU sanctions on Russian oil fully take hold. It is also an opportunity to pursue more favourable fleet renewal by disposing of older vessels during a spike in values and reinvesting the proceeds into younger tonnage”.

Gibson added that “within this development there also has been an increase in sales and enquiry for Ice class Suezmaxes and Aframaxes, capable of trading during the Russian ice season. Also propping up older tanker values is the persistence of the illicit fleet, which continues to absorb older scrapping candidates to engage in sanctioned trade. Although, should sanctions relief come to Iran, then this would increase scrapping pressure on older vessels operating in the shadow fleet and reduce their market value as the commercial opportunity to engage in this trade recedes. Instead, legitimate trading opportunities would re-emerge for younger, more efficient vessels to take on the trade of these cargoes”.

“Fundamentally, this all feeds into the growing positive outlook for crude tankers. Stronger earnings should theoretically support these higher asset values as the cashflow generating capacity of larger crude tankers improves, although growing economic uncertainty and the risk of a global downturn indicate the need for caution in terms of investment timing. Overall, the investment prospects for the tanker market have improved relative to the protracted market slump of the last 20 months and this is catching the eye of potential investors, whilst tanker owners are likely to be considering their next moves”, Gibson concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide

Australia is set to have a glimpse of what to expect under the Australia–UK–US submarine partnership (AUKUS) after the United Kingdom announced a joint training program on the newly commissioned HMS Anson. She was delivered to the Royal Navy at the end of August and promoted as the “most advanced submarine ever built.”

In one of his final acts as British Prime Minister, Boris Johnson attending the handover ceremony said that Australian submariners will join Royal Navy crews on training missions on the newly commissioned submarine. It will be the next step as the countries seek to deepen defense ties through the AUKUS pact that was announced in September last year. The UK will prepare the Australians for their planned nuclear subs to be built under the pact.

The Anson is the fifth of seven new Astute-Class submarines that the Royal Navy is building. It joins HMS Astute, Ambush, Artful and Audacious that are already in service. The remaining two, Agamemnon and Agincourt, are in various stages of construction as part of a $12.8 billion overall investment in the whole Astute-Class program.

Built at a cost of $1.5 billion, the hunter-killer Anson is being described as one of the most sophisticated underwater vessels ever built armed with up to 38 Spearfish Heavyweight Torpedoes and Block V Tomahawk land attack missiles capable of tackling targets at a range of up to 1,000 miles. At approximately 318 feet in length, and a displacement of 7,800 tons, the nuclear-powered submarine was built at BAE Systems’ yard in Barrow, Cumbria.

“From the Pacific Ocean to the Baltic Sea, our submarine service is protecting the UK and our allies and the deployment of Australian submariners alongside our British crews epitomizes the strength of the AUKUS partnership,” said Johnson during the commissioning of the submarine last week. The event was attended by Australian Deputy Prime Minister Richard Marles.

Johnson added that with naval capability at the center of the two countries’ future defense relationship, the joint training will reinforce the priorities of the Integrated Review and the significance of the AUKUS partnership that is designed to promote stability in the Indo-Pacific region.

The UK and U.S have already welcomed Royal Australian Navy personnel on their specialized nuclear training courses with more expected to follow next year before Australian submariners go to sea. The training and exchanges mark the beginning of a multigenerational naval partnership between the three AUKUS nations.

The Royal Navy has described Anson as the cutting edge in submarine design, including the incorporation of naval stealth into her form and construction that gives the UK an operational advantage in the underwater battlespace. The submarine can reach speeds of over 30 knots and is fully equipped to destroy enemy military infrastructure both on land and in the sea. The onboard Rolls Royce nuclear reactor means the vessel, which took 11 years to build, will never need to be refueled during its 25-year service period.

Anson will remain in Barrow for several more weeks undergoing final checks, tests, and tweaks to her system before she sails for her future home at HM Naval Base Clyde in Faslane, where she will prepare for sea trials.

General cargo ship HAV MARLIN contacted pier while mooring at Vierow Port, Mecklenburg-Vorpommern, Germany, Baltic sea, in the morning Sep 5, on arrival from Antwerp via Kiel Canal, with 2800 tons of fertilizers on board. Both ship and pier sustained damages, ship’s portside forecastle and bow are heavily dented. No hull breach, no leak reported.

Source: https://www.fleetmon.com/maritime-news/2022/39429/freighter-contacted-pier-sustained-damages-germany/

Product tanker HAFNIA TANZANITE suffered fire in engine room, probably being under way, some 35 nm WNW of Hoek van Holland, Netherlands, early in the morning Sep 5. Fire was extinguished by Halon fire suppressing system, but tanker was disabled. She’s to be towed to port of destination Rotterdam. Was either dead in the water or anchored at 1430 UTC, with Multraship tug and SAR boat at her side, AIS is on. No reports on injures. Tanker arrived from Singapore.

Source: https://www.fleetmon.com/maritime-news/2022/39425/tanker-disabled-fire-netherlands/

The 46,000 m³ dual fuel (LPG) vessels are scheduled for delivery in the fourth quarter of 2024 and the first quarter of 2025 respectively. The price tag for the newbuilds has not been revealed.

Exmar said that the JV has an option for two additional vessels of 46,000 m³ slated for delivery in 2025. As disclosed, these ships have the option to be delivered with ammonia dual-fuel propulsion.

EXMAR currently owns/operates 19 midsize gas carriers, three very large gas carriers, and 10 pressurized vessels.

The Royal Navy has taken the unusual step of responding to media speculation by issuing a detailed statement on the damage to HMS Prince of Wales. One of the two largest ships of the fleet and only having recently been placed into service, the carrier suffered an embarrassing failure as she departed for what was being called a “landmark mission” in cooperation with the Americans.

Speaking in a videotaped statement, Rear Admiral Steve Moorhouse said, “Our focus has been on understanding the nature and extent of the damage and the safety of her crew. We will repair her and get her back on operations, protecting the nation and our allies, as soon as possible.”

HMS Prince of Wales departed Portsmouth on Saturday, August 27, for what was to be a nearly four-month program to sail to the United States for joint training exercises and a visit to the Caribbean. Observers noted as she departed that she seemed to only be showing a wake on the portside leading to rampant comments of a problem with possibly the starboard propeller.

Shortly after sailing, the carrier anchored with the Royal Navy admitting there had been an “issue” after her departure. She was later moved to a more sheltered position while a survey was ongoing.

“Royal Navy divers inspected the starboard shaft and adjacent areas,” says the Rear Admiral. “We can confirm there is significant damage to the shaft and the propeller and some superficial damage to the rudder. There is no damage to the rest of the ship.”

The initial assessment of the carrier also shows an “extremely unusual fault,” in the starboard shaft. The coupling that joins the final two sections of the shaft has failed.

According to the reports, the Royal Navy is currently trying to stabilize the situation before they can return the vessel to Portsmouth. They are also investigating repair alternatives, but are admitting that it is likely the Prince of Wales will need to dry dock to undertake repairs. No estimates were offered on how long it might take to complete the repairs.

In an effort to save the mission, the Royal Navy reports that they have reassigned HMS Queen Elizabeth to undertake a portion of the training exercise with the United States. The first carrier of the class is due to stand in for her younger sister ship departing this week for the United States. However, she will return to Europe earlier than planned to undertake her fall exercises which were scheduled for the Mediterranean.

So far, the Royal Navy has not offered any explanations as to how the damage occurred to the Prince of Wales. It is just the latest in a series of high-profile failures of the multi-billion-dollar carrier. Commissioned in December 2019, she spent most of 2020 and 2021 sidelined with a series of problems. Finally, in October 2021, the Royal Navy declared that she was fully operational and would be fully ready for frontline deployment by 2023.
Source: https://www.maritime-executive.com/article/hms-prince-of-wales-has-significant-damage-likely-requiring-dry-dock

The shipping industry has long known about the dangers of parametric rolling with researchers working to expand the understanding of the phenomenon that has increasingly become linked with damage to containers and car carriers. Now a Danish company that manufactures a broad range of sensors reports it has developed and tested a system on containerships that can alert crews to the danger or even automatically adjust a ship’s course before it begins the rolling phenomenon.

The hull forms of modern containerships and car carriers are believed to make them especially susceptible to parametric rolling. In the worst cases, during a series of uncontrollable movements, ships have reported that they heel up to 46 degrees in a very short time. Investigators have long believed that these incidents, which often come up quickly and without warning have contributed to container stack collapse and the loss of containers overboard such as the recent incidents with the ONE Apus, APL England, and several Maersk ships.

A current three-year study being undertaken by the container shipping sector has already identified that parametric rolling in following seas is especially hazardous for container vessels. The project is conducting testing and measurements to further identify the causes and how they can be addressed but so far has largely only been able to provide mariners with a few warnings and general instructions.

Danish company, Kjærulf Pedersen, which manufactures and develops sensors for measuring temperature, humidity, CO2, and O2, now reports it has developed a sensor system that can recognize the tendencies that lead to parametric rolling and send a message to the ship’s control system so the
system and crew have time to change course.

“Parametric roll can occur in just eight wave cycles, each lasting four to five seconds, and from roll to roll, the heeling may be doubled. It is impossible to detect, because it goes very quickly, and the situation is incredibly dangerous for everyone,” says Ole Egelykke-Milandt, sales engineer and project manager at Kjærulf Pedersen.

On the other hand, Egelykke-Milandt notes that it only requires that the course be changed slightly for the ship’s movements to slow down again.

The company’s system is based on three sensors, placed at the bow, amidship, and stern. All the ship’s movements are monitored in real-time up to 100 times a second. The system compares the observations with data on the ship’s speed, acceleration, and direction. The sensors detect if the movements are approaching a state that can become uncontrollable, and notifies the ship’s control system so that the course can be changed and the uncontrollable tilts are avoided.

Since January, the system has been installed on four large container ships that sail between China and the US, and the company reports its tests with Maersk have shown that the system is successful in recognizing the warning signs for parametric rolling. Kjærulf Pedersen reports that the system is now being implemented on the shipping company’s container fleet.

“In the long term, the plan is for data from the ships to flow into a central location so that all the shipping company’s ships can have use of the collected data. In this way, we get an algorithm that gets better and better at predicting dangerous situations, thus increasing safety significantly,” says Egelykke-Milandt.

The large amount of data from the sensors will also be used for other improvements such as weight distribution and the ship’s trim in the water.
Source: https://www.maritime-executive.com/article/sensor-company-builds-system-to-warn-of-parametric-rolling-danger

Methanol is continuing to gain momentum as a leading option for the shipping industry to address decarbonization. Already adopted by an emerging group of shipping lines, two of China’s leading shipping companies are joining the effort focusing on methanol for their future fuel choice.

During a meeting discussing the industry’s energy transition, the chairmen of China Merchants and COSCO Shipping Bulk announced that their companies will focus on Methanol marine fuel as their primary area of research in the future. CMES chairman Xie Chunlin and Gu Jinsong, Chairman of COSCO Shipping Bulk made the comments in a meeting held in late August according to the Methanol Institute, during which the two reviewed the cooperation between their companies and exchanged views on the shipping industry’s low-carbon transformation.

The news that the Chinese companies plan to focus on methanol follows previously reported efforts by COSCO to develop shipping using the alternative fuel source. COSCO Shipping Energy Transportation and Dalian Shipbuilding Industry Company (DSIC) reported in February that they had received design approval for China’s first domestic methanol dual-fuel VLCC. The design calls for a 310,000 dwt VLCCs equipped with two methanol fuel tanks with a total of 10,000 m³, which would give the vessel range of 2,3000 nautical miles.

Previously, several government ministries have referenced low carbon and renewable methanol development from green hydrogen and methanol-fueled vessels as key enablers for the country’s policies to decarbonize the shipping industry noted Kai Zhao, Chief China Representative for The Methanol Institute. “That places methanol at an entry point on the transition curve where two leading Chinese companies can reduce GHG emissions and achieve carbon neutrality in the longer term.”

The Methanol Institute welcomed the comments made by the chairmen of China Merchants Energy Shipping and COSCO Shipping Bulk supporting methanol noting it is part of a growing trend for the alternative fuel. The attention coming from the China Merchants Group they noted is especially encouraging as the company is the second largest among non-financial shipowners worldwide with its fleet and pending newbuild orders totaling 315 ships equivalent to 44.6m dwt. COSCO Shipping Bulk operates a fleet comprising some 400 bulk carriers, equivalent to nearly 40m dwt.

“China is already a leader in production of renewable energy and the shift towards methanol long term is in step with its decarbonization ambitions,” says Chris Chatterton, Chief Operating Officer, The Methanol Institute. “The shipping industry can’t wait for fuels that may be decades away from approval and availability; shipowners need a place to start in making carbon savings and Methanol can provide that transition now.”

They noted that in the past year that Maersk, CMA-CGM, and X-Press feeders each placed orders or increased their commitments for methanol newbuild vessels. Companies including Waterfront Shipping, Stena/Proman, NYK, and MOL have also built methanol carriers that use a segregated portion of the cargo as fuel.

With more bulk shipowners exploring methanol as fuel, the Institute also highlights that this year has seen methanol/dual-fuel designs for bulk carriers and tankers coming to market. Main engine makers report full order books for new units and increasing interest in retrofits and conversions of existing engines.

According to data from DNV’s Alternative Fuel Insight, today less than one percent of the worldwide shipping fleet operates on methanol. They report that there are currently 62 ships either in operation or on order that use methanol out of a worldwide fleet of nearly 6,800 ships. Methanol is currently used mostly by oil and chemical tankers although the new orders came from container shipping.
Source: https://www.maritime-executive.com/article/cosco-and-china-merchants-exploring-methanol-fueled-ships

The ship recycling market could be set for a revival in the coming days and weeks, as more dry bulk vintage tonnage could be sold for demolition. In its latest weekly report, shipbroker Clarkson Platou Hellas said that “with China implementing new lockdown regulations, the dry freight market was sent into further negative spins and therefore, we may now see more vintage dry units circulated into the market. A capesize bulker achieved a very impressive number this week, as per the sale listed below, with a good quantity of bunkers RoB. However, there are rumours the buyer may attempt to fix on a short trade, despite the poor sentiment in the dry sector, which could then justify the premium paid. If the sale is aimed towards a resale into Bangladesh and the hope of the Government once again allowing larger L/C’s to be opened (from the current limit of USD 3.0 mill), then unfortunately information obtained from Bangladesh towards the latter part of the week will not aide the Buyers resale structure.

Source: Clarkson Platou (Hellas) ltd

The shipbroker added that “information became apparent that new taxations may come be implemented as the Government aim to set reasonable prices of nine products, including flour, edible oil, lentils, sugar, rice, flour, coarse flour, cement and rods, within the next 15 days in an effort to bring stability to the country’s economy. There are even discussions of lawsuits being filed against anyone disregarding the designated prices. Pakistan is currently undergoing horrific flooding from the monsoon rains and the industry is really at a standstill for the time being. Our thoughts and prayers go to those currently suffering from these tragic floods. With the country still suffering from their currency woes, and the current flooding, little activity is expected for the foreseeable future”, Clarkson Platou Hellas concluded.

Meanwhile, GMS (www.gmsinc.net), the world’s leading cash buyer of ships, said in its latest weekly report, that “activity and availability of sales candidates seem to be finally starting to increase as we enter the month of September and the fourth (and final) quarter of the year. Dry bulk (and particularly Capesize bulker) rates have declined noticeably of late, and this is seeing an increasing number of enquiries on dry units starting to come forth for a potential sale for recycling. This increase couldn’t have come at a better time as local demand for tonnage has been gradually ramping up again, after an extremely quiet summer / flooded monsoon. Of course, after the collapse of the Sri Lankan economy earlier this year, difficulties persist in the sub-continent markets as both Pakistan and Bangladesh have been teetering perilously close to the brink as well”.

Source: GMS,Inc

According to GMS, “Pakistan has been beset by catastrophic flooding over the past week, with thousands of people losing their lives and millions displaced. In fact, some international media have been reporting that nearly one-third of the country is currently underwater. As such, calls for urgent humanitarian aid have reached the international community this week, with the situation becoming increasingly dire. Bangladesh is still struggling with L/Cs with any transaction valued at over USD 2 – USD 3 million needing Central bank approval, which is ensuring that most large LDT / higher value candidates are being diverted to competing markets and even the lower placed India, as Cash Buyers and Ship Owners both do not want to run the risk of getting stuck there, especially when levels have already fallen so much. India remains the most resilient market and is now becoming the go to destination (albeit at lower prices) for shipowners wishing to get their vessels delivered comparatively hassle and headache free, be it at a lower price. Finally, the Turkish market remains marginally changed from last week, as import steel and the Turkish Lira both report decreases during the week, all while local sentiments remain in the doldrums”, GMS concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide

With some shipping now on the move again out of Ukraine, the northern Black Sea has been designated a Warlike Operations Area for merchant vessels. Sarah Robinson looks at what this means for seafarer safety and how trade unions are involved in providing protection for their members

When people embark on a career in the Merchant Navy, they’re probably not expecting to see military action, but this in fact a persistent safety problem for civilian seafarers around the world.

We might think of the cargoships in the Second World War supply convoys, or the ferries and cruiseships requisitioned as troop carriers (with their usual crews) for the Falklands conflict.

But many Merchant Navy seafarers who find themselves in danger from conflict aren’t engaged in official ‘war work’, but find themselves in a dangerous situation as they go about their usual activities. For example, in the Telegraph we have told the stories of Nautilus International members whose civilian tankers came under fire in the Persian/Arabian Gulf during the Iran-Iraq war, and others whose vessels became marooned in the Great Bitter Lake off the Suez Canal as a result of the Six-Day War.

Ukraine: the latest maritime war zone

This year, Merchant Navy seafarers from all over the world have been asked to go through a war zone on an urgent humanitarian mission to bring crops out of Ukraine and on to the countries who rely on this food, which includes wheat, other cereals, and sunflower seeds for cooking oil.

Famously known as ‘the breadbasket of Europe’, Ukraine under normal circumstances is one of the top three grain exporters in the world, but since the Russian invasion in February 2022 has struggled to get its harvests out of mined and blockaded Black Sea ports.

Hopes were not high that this problem would be overcome, but after many false dawns, the involvement of Turkey eventually brought both Ukraine and Russia to the table in Istanbul to sign a United Nations agreement on 27 July – establishing the Black Sea Grain Initiative.

Aiming to keep seafarers safe

The Black Sea Grain Initiative specifically allows for significant volumes of commercial food exports from three key Ukrainian ports in the Black Sea: Odesa, Chornomorsk and Yuzhny. Ukrainian vessels guide the cargoships into the international waters of the Black Sea, avoiding mined areas. The vessels then proceed towards the Bosphorus Strait along an agreed corridor. Both the Russian and Ukrainian sides have agreed to withhold attacks on any of the commercial vessels or ports engaged in the initiative to transport vital grain.

For the merchant seafarers on the cargoships, their safety is in the hands of a new UN Joint Coordination Centre, which monitors implementation of the 27 July agreement. It is hosted in Istanbul and includes representatives from Ukraine, Russia and Turkey.

Ships heading to and from the Ukrainian ports are being inspected by teams organised by the Joint Coordination Centre to ensure they are only carrying the agreed food cargoes and not soldiers, weapons or ammunition.

Who are the Merchant Navy seafarers on the grain ships?

Initial reports suggested that maritime employers were struggling to find crew members willing to take part in the Black Sea Grain Initiative, and until recently Ukrainian nationals were not usually allowed to leave the country because of military conscription. However, permission has now been given for Ukrainian seafarers to travel for work, and recruitment from other nations seems to have improved, judging by the daily shipping movements being reported by the UN Joint Coordination Centre.

Inevitably for the shipping industry, some of these vessels will be crewed by seafarers from developing countries who are not in a financial position to turn down work and are not supported by a trade union.

However, the International Transport Workers’ Federation (ITF) – of which Nautilus is an affiliate – has ensured that some 9,500 vessels and 170,000 seafarers worldwide are covered by Warlike Operations Area agreements instigated by unions. These are either national agreements (of which more below) or international agreements negotiated between the ITF and shipowners at the International Bargaining Forum (IBF).

‘While specific terms of each agreement differ depending on the nature of the risk involved, in general they allow for seafarers to disembark before a vessel enters the affected area,’ says Nautilus head of professional and technical David Appleton. ‘They may also place obligations on companies to underwrite any insurance policies that may be rendered invalid by entering into the area and, in certain instances, agree additional payments for seafarers whilst they are in the area.’

Nautilus general secretary Mark Dickinson has been regularly involved with negotiations at the IBF, where Warlike Operations Area agreements for the Northern Black Sea Region, the Sea of Azov and All Ports in Ukraine were added in March 2022.

He stresses how important it is that seafarers around the world join a union, particularly one affiliated with the ITF: ‘This is a powerful example of how unions work together internationally to secure protection for their members and help seafarers globally, and we will continue to be part of the movement to uplift everyone in the industry to decent and safe work onboard.’

Enhanced war zone protection for Nautilus members

Nautilus members in the UK and Netherlands are covered by national warlike operations agreements that go beyond the IBF terms.

In the UK, the process of drafting and renewing agreements is done through the Warlike Operations Area Committee (WOAC), at which terms are agreed directly between the maritime unions Nautilus and RMT and the UK Chamber of Shipping. There is a similar process in the Netherlands where Nautilus negotiates agreements with the Dutch shipowner bodies VWH, NEMEA, Neptune and Spliethoff.

The UK WOAC agreement for Ukraine applies to all vessels operated by companies in membership of the UK Chamber of Shipping. It expands on the IBF minimum in a number of ways – for example, by declaring a broader Warlike Operations Area that covers ‘all Ukrainian, Russian and International Waters north of 44°North in the Black Sea.’

The Netherlands war zone agreement for Ukraine applies to Dutch-flagged vessels and is broadly equivalent to the UK WOAC agreement.

‘Both the British and Dutch agreements reflect the importance of regular dialogue between unions and employers,’ says Mr Appleton. ‘We are not currently aware of any Nautilus members on vessels involved in the Black Sea Grain Initiative, but members with any concerns about operating in a warlike or high risk area should contact us and we will be able to advise them of their rights, whether those fall under the national agreements in the UK and Netherlands or they relate to the IBF agreement.’

Source: https://www.nautilusint.org/en/news-insight/telegraph/working-in-a-war-zone-how-national-and-international-warlike-operations-area-agreements-protect-merchant-navy-seafarers/

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