Henrik Falck Tschudi Shipping Company AS Voyage Calculations The Northern Sea Route TFMS Forum Copenhagen, October 24 th. 2012
TSCHUDI SHIPPING COMPANY AS Tschudi Shipping Company AS is the holding company for the Tschudi Group with roots back to 1883. The Tschudi Group is a shipping and logistics group with particular focus on the east west trades of cargoes and projects involving the Baltic, Russia and the CIS countries including the Northern Regions of Russia and Norway. The Tschudi group currently owns a fleet of 16 multipurpose container vessels, tugs and offshore vessels in addition to operating container lines between northern European ports in the Baltic and North Sea.
Sydvaranger Gruve Northern Iron www.sydvarangergruve.com - In 2006, Tschudi Shipping Company bought the closed down iron ore mine in Kirkenes, Northern Norway. - In November 2009 the first Panamax loaded for China with 75 000 of cargo. - In September 2010 we did the first transit through the Northern Sea Route. - Production in 2011 was 1,5 mill. mt with forecast for 2012 at 2,0 mill. mt. Th N th I i li t d th A t li t k h (ASX) The company Northern Iron is listed on the Australian stock exchange (ASX) Ticker code NFE www.northerniron.com.au Tschudi controls abt. 20% of the outstanding shares today.
Tschudi Kirkenes 20 km from Russian Border Our Bulk Terminal in Kirkenes is able To load vessels up to 100 000 dwt In addition we have: -6 000 m 2 quay with draft of 8,2 m -5 000 m 3 covered warehouse -370 000 m 3 silo storage -1 000 000 m 2 levelled area for further development
Kirkenes Industrial Logistics Area - KILA. KILA 1.000.000 1 000 000 m² area and more than 600 m deep water quays can be constructed.
KILA (Kirkenes Industrial Logistics Area) THE WESTERN ENTRY POINT TO THE NORTHERN SEA ROUTE 1.000.000m² = 200 soccerfields Kontakt: Trond Dahlberg, mobil: +47 9958 0654, mail: td@tschudikirkenes.no
Kirkenes Kirkenes 9 days from the Pacific Ocean 9 days from the Mediterranean
Hammerfest Melkøya LNG Terminal
POLARCUS SEISMIC VESSEL HAMMERFEST NEW ZEALAND TC-Rate usd 150 000 pd Routing Distance (13 kts) Canal cost Bunker TOTAL Via Suez45,1 days usd 100 000 usd 1 622 000 usd 8 487 000* Via Panama 39,4 days usd 50 000 usd 1 417 000 usd 7 377 000 Via NSR 31,5 days usd 370 000 usd 1 133 885 usd 6 228 000** SAVING VERSUS PANAMA IS usd 1 030 000 (* 70 000 ** 120 000 extra insurance)
Savings in USD for 21,4 days saved in time. LNG from Melkøya to Yokohama - 147 000 cbm Full roundvoyage - Spot market rate usd 15/mmBtu 1. Timecharter per day usd 150 000 * 21,4 * 2 usd 6 420 000 2. Bunkers burn off lng 0,1% per day * 21,4 * 2 usd 2 200 000 3. Suez round voyage cost usd 150 000 4. NSR tariff usd 5 * 70 000 mt + usd 2,5 * 113 000* (usd 632 000) ---------------------- Savings (Full Roundvoyage) usd 8 138 000 (* displacement tons)
3 roundtrips per season may add up to a total savings of usd 25 million Yamal is another 8 days (roundtrip) better positioned with NSR representing even more value. We are talking about unlocking the High North in general and Siberia in particular.
Typical trading pattern for dry bulk Panamaxes Trans-Atlantic Trans-Pacific Timecharter Rate Timecharter Rate 7 500 $ per day 7 500 $ per day From Atlantic ti to the From Pacific to the Pacific Atlantic 15 000 $ per day 1 000 $ per day
Kirkenes - Shanghai 18 day shorter one way (Panamax iron ore) 1. Timecharter per day usd 15 000 * 18 usd 270 000 2. Bunkers fuel 33 * 700 * 18 usd 416 000 3. Insurance usd +/- 4. Ports usd n/a 5. Suez cost (one way) usd 250 000 6. NSR tariff usd 5 * 75 000 mt (usd 375 000) Savings usd 560 000 Savings per ton usd 7.50
Same difference explained another way SUEZ NSR DIFFERENCE Bunkers 44*700*33 1 016 000 26*700*33 601 000 415 000 TC - Cost 48 * 15 000 720 000 30 * 15 000 450 000 270 000 Canal 250 000 375 000-125 000 Ports 250 000 250 000 0 Total 2 372 000 1 795 000 560 000 NSR Fee Suez Cost Bunker consumption per day* Price + Timecharter cost = Break even Number of days (3,3 days) St.Petersburg (Russia) is only 5,5 days shorter
Last Done. Freight rate 82 000 mt * usd 33,5 usd 2 747 000 Commission 5% usd 137 000 Bunkers 44 days*33 mt* usd 700 usd 1 016 000 Bunkers in port 4 days*3 mt* usd1 000 usd 12 000 Suez Canal usd 250 000 Ports usd 250 000 Insurance usd 110 000 Extra usd 50 000 T/C result usd 922 000 T/C result per day (usd 922 000/ 48 days) usd 19 200 T/C result per day for a vessel loading 70 000 mt usd 10 800
Since the cargo owner should not care about what routing the owner takes, let us use last done (usd 33,5) on a smaller Panamax through NSR Freight rate 70 000 mt * usd 33,5 usd 2 345 000 Commission 5% usd 117 000 Bunkers 26 days*33 mt* usd 700 usd 601 000 Bunkers in port 4 days*3 mt* usd1 000 usd 12 000 NSR Fee usd 350 000 Ports usd 250 000 Insurance usd 70 000 Extra usd 50 000 T/C result usd 895 000 T/C result per day (usd 895 000/ 30 days) usd 29 800 T/C result per day for the large Panamax going through Suez usd 19 200
Another Point: If you have a vessel in Rotterdam today and can fix a cargo from Kirkenes to China and you have tonnage that can do the NSR, - you will be making usd 29 800 per day in stead of usd 19 200 that your competitors are getting through Suez, - even after adjusting for economy of scale and you will be 18 days closer to the next loading port.
If a vessel makes one trip a year through the NSR, thereby saving 18 days and if a vessel has a technical lifespan of 20 years then this vessel will have gained one extra year of trading. 18 days * 20 years = 360 days The value of one year extra trading varies between usd 80 000 pd and usd 5 000 pd?
VITINO
Tanker Market Rotterdam-Vitino-NSR- Shanghaih 21 days Rotterdam-Vitino-Suez-Shanghai 40 days Savings 19 days Shanghai-Pusan-NSR-Rotterdam Shanghai-Pusan-Suez-Rotterdam Savings Total roundtrip savings 25 days 37 days 12 days 31 days
Tanker Market 31 days savings represent: Timecharter cost 31days * usd 7 000 (?) usd 217 000 Bunker cost 31days * 32 ton * usd 700 usd 694 000 Extra canal cost *2 usd 250 000 Extra Insurance usd +/- 0 Total savings usd 661 000 Savings per ton (2 * 60 000) usd 5.50
Tanker Market It is probably the lower freight cost using the NSR that makes this trade possible. From a cargo owners perspective it is possible to do 3 roundvoyages during the NSR season, compared to only 2 roundvoyages through Suez.
SUMMARY Port charges remain the same Commission remain the same Extra insurance will be higher h for some operators and lower for others, but deductible will be (much) higher. NSR transit fee will be higher than Suez cost and (much) higher than the Panama Canal. Main cost elements are the timecharter cost (for LNG and Seismic) and bunker costs (Tankers and Bulkers)
FINAL REMARKS NSR will be handling less than 50 vessels this season Compared to 19 000 in Suez Compared to 15 000 in Panama NSR will remain a niche (Arctic) in a segment (Ice) of the market As my calculations have shown it is a very interesting niche.
Thank you for your attention