HCB Magazine September 2021

Page 20

18

SIZE IS IMPORTANT CONSOLIDATION • SMALL AND NIMBLE OR BIG AND POWERFUL? THERE’S ROOM FOR BOTH AS CONSOLIDATION IN THE CHEMICAL TANKER SECTOR GAINS PACE AT A TIME of great volatility in global chemical supply chains, it is tempting to take the view that agility is the best response, allowing logistics operators to respond quickly to changes in demand patterns. But there are plenty in the chemical tanker sector who take an opposing view; after all, the demand is there, even if trade flows are changing rapidly

Odfjell, noted that the past five years have witnessed a gradual increase in consolidation within the core chemical tanker fleet, a trend that he expects to continue at a time when financial investors are in divestment mode. The chemical tanker sector is highly fragmented and the spot market is competitive but, Hammer explained,

in response to underlying product demand and supply issues, with the ripples of the ongoing Covid-19 pandemic, port constraints and weather-related disruptions all playing a part this year. Speaking recently to investors, Bjørn Hammer, global head of tanker trading at

consolidation is pivotal to removing that fragmentation to make the contract of affreightment (COA) market more dependable – something that will be vital to the financial health of the major players in the sector. Therefore, developing a larger fleet helps operators to adapt to changing demand

HCB MONTHLY | SEPTEMBER 2021

patterns, by having more ships at their disposal, and to attract more COA business by offering a reliable service. Focusing more on longer-term contracts provides a great deal of protection against volatility in the spot market, which for chemical tankers often reflects the behaviour of the clean product (CPP) trades and the volume of swing tonnage looking for easy chemical cargoes. The chemical tanker sector is also currently enjoying the fruits of an historically low orderbook, which stands at under 5 per cent of the existing fleet. Consolidation helps the major owners keep a lid on speculative ordering and this is being reinforced by the position of financial investors and by the uncertainty caused by the need to address as yet loosely defined future environmental performance standards. GREENER TOGETHER That drive for sustainability also helps explain the current trend for consolidation. Chemical tankers are expensive pieces of machinery that are designed with a long working life in


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Articles inside

Australia updates ADG

4min
pages 64-65

Texas codifies storage tank safety

5min
pages 62-63

Salvors busy yet again

3min
page 55

Changes planned for RID/ADR/ADN

14min
pages 56-61

What went wrong with Stolt Groenland

10min
pages 52-54

Conference diary

2min
pages 48-49

Incident Log Heat treatment

8min
pages 50-51

News bulletin – chemical distribution

6min
pages 46-47

CBA counts cost of disruption

2min
page 45

IMCD expands in China, Latin America

6min
pages 40-41

News bulletin – tanks and logistics

6min
pages 38-39

Brenntag’s strategy pays off

5min
pages 42-43

Univar sees demand return

2min
page 44

STC considers market changes

3min
pages 36-37

VTG adds security system

2min
pages 34-35

More acceptance for digital systems

4min
pages 32-33

Perolo enjoys surge in orders

5min
pages 30-31

Odfjell tests hull cleaning idea

3min
page 25

OCIMF tweaks SIRE

2min
pages 26-27

Proman expands methanol fleet

2min
page 24

News bulletin – tanker shipping

6min
pages 28-29

Stolt Tankers joins zero carbon plan

3min
page 23

Consolidation comes to chemships

8min
pages 20-22

Letter from the Editor

4min
pages 3-5

Oiltanking tests drones

3min
pages 16-17

Survey shows the need for action

6min
pages 8-9

Learning by Training Face the change

2min
page 7

News bulletin – storage terminals

4min
pages 18-19

Stolthaven recognised in Brazil

2min
pages 12-13

Vopak faces energy transition

6min
pages 14-15

30 Years Ago

2min
page 6
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