It has never been more expensive to get a container of goods across the ocean. But it’s not just containers. Liquified natural gas (LNG) shipping is also rewriting the record books.Argus reported that BP has just chartered the ship LNG Abalamabie for the equivalent of $350,000 per day. That makes it the most expensive cargo-ship charter in history, surpassing the $300,000-per-day peak previously recorded in the very large crude carrier (VLCC) segment.What’s different about the LNG record — compared to container and crude shipping highs — is that LNG deals remain extremely profitable for cargo shippers.The cost of LNG in Asia is now so much higher than the cost in the U.S. that shippers can pocket massive profits even when paying record rates to transport cargoes from the Atlantic to the Pacific Basin.When the VLCC sector hit its pinnacle, crude transport costs reached the point where they erased refiners’ margins; refiners stopped booking cargoes and rates fell back. In the container sector, rates appear to be near the point where they erase importer profit margins. Some importers may even be transporting goods they will have to sell at a loss, because the alternative is to halt imports and lose market share to competitors.In LNG shipping, there is plenty of room for rates to rise and for shippers and traders to still profit on the cargo move.The problem — similar to what is happening in the container sector — is that there are not enough LNG ships in existence to handle demand.
Source: freightwaves (Click for further of the article)
Source: freightwaves (Click for further of the article)