H.P. Drewry Reports On The Market For Medium-Sized (70-175,000 DWT) Tankers
While the comparatively recent phenomena of the VLCC and ULCC on the one hand and the sophisticated products carrier and other small tankers on the other have been widely discussed, the medium-sized tanker (70-175,000 dwt) has been largely ignored.
H.P. Drewry (Shipping Consultants) Limited aims to fill this gap in tanker market information with its latest study "The Market for Medium-Sized Tankers (70-175,000 dwt)." The study contains a detailed examination of the medium-sized tanker fleet as a whole and analyzes it in terms of fleet characteristics, current pattern of employment and future supply and demand of medium-sized tanker tonnage.
At the end of 1975 there were 657 medium-sized tankers, totaling 66 million dwt, which represented 23 percent of world tanker tonnage, while the order book comprised 251 vessels amounting to 30 million dwt, or 28 percent of the total tanker order book.
The corresponding figures for small tankers (under 70,000 dwt) and VLCCs (over 175,000 dwt) were 70 and 150 million dwt, or 25 percent and 52 percent of world tonnage, with some 8 and 71 million dwt on order. Two hundred and fifty-one medium-sized combined carriers totaling 31 million dwt represented 72 percent of the total combined carrier fleet, and there was another 6 million dwt on order representing 80 percent of the order book. By mid-1976, through cancellations and deliveries, the structure of the tanker order book had changed considerably, with that for medium- sized tonnage standing at 173 vessels totaling 21 million dwt, and that for small and VLCC tonnage at 7 and 42 million dwt.
Only one combined carrier order had been canceled. The 1980 ratio of world tanker tonnage, based solely on the mid-1976 fleet and order book (without scrappings, etc.), would be 20:25:55 for small, medium and large tonnage or 73, 91 and 205 million dwt, the effect of new deliveries on the relative proportions being minimal.
The first medium-sized tankers were sent to breakers' yards in mid-1975, and by June 1976, nineteen vessels totaling 1.7 million dwt had reportedly been sold for scrap. Characteristically, these were steam-powered, oil companyowned ships, built in the early 1960s and mainly in the 80,000, 90,000 and 100,000-dwt ranges.
At end-1975, 98 percent of the fleet was less than 16 years old, but only 42 percent was less than six years old, compared with 78 percent of the VLCC fleet.
The largest size group within the medium-size range in 1975 was the 80,000-tonners, a substantial number of which were the "Sanko Deal" ships; 70,000- tonners amounted to 11 million dwt (16 percent of the total), 90,000-tonners to just over 9 million dwt (14 percent of the total), and 130,000-tonners to just under 9 million dwt (13 percent of the total). In 1980, with the addition of the end-1975 order book and not allowing for scrappings, etc., the largest size category will still be 80,000-tonners, but 70,000-tonners will slip in relative significance due to the current complete absence of orders for them.
The medium-sized tanker fleet has a larger proportion of independently- owned tonnage than either the small or VLCC fleets, 73 percent being independently owned at mid-1976, compared with 57 percent for small and 65 percent for large tankers. Of the independent owners of medium- sized tonnage, Greek, Japanese and Norwegian owners are predominant, with NYK, which has about 2 million dwt, being the largest. Exxon and Shell have about 2 and 1.5 million dwt, and the Governments of India, Chile, Brazil, Poland and Portugal each have substantial volumes of medium- sized tonnage. Changes to the ownership structure through new deliveries alone will be small, but there has been a noticeable trend in second-hand sales of medium-sized tankers from independents to government-sponsored national fleets.
A detailed investigation of the current employment of mediumsized tankers is made in Section 2 of the study, including a separate analysis of the U.S.-flag mediumsized tanker fleet. This shows that three loading areas account for 80 percent of medium-sized tanker loads, with 57 percent made in the Middle East (Gulf), 13 percent in North Africa, and 10 percent in West Africa. South Europe was the most important discharge region, with 28 percent of all medium-sized tanker discharges, followed by Japan, with 20 percent, and North Europe and the East and Gulf Coasts of the U.S., each with 15 percent. The pattern of trade for U.S.-flag medium-sized tankers, the figures for which are excluded from those given above, is radically different, for 75 percent of their movements are made between U.S. ports, such trades being restricted by the Jones Act to U.S.-flag vessels. In 1975, medium-sized tankers were responsible for transporting about 21 percent of seaborne world oil movements. Their major routes, in terms of employment, tend to be the long-haul VLCC/ULCC routes; on AG PG to South Europe, for example, they were only responsible for carrying 7 percent of all oil moved, but from AG7PG to Japan were responsible for 30 percent of oil moved. Mediumsized tankers carried virtually all oil moved from the East Mediterranean to South Europe, mainly because the loading ports could not accommodate fully laden VLCCs.
A detailed appraisal of ports used by medium-sized tankers by type of port and frequency of calls in principal load and discharge areas is made. Analysis of the calls reveals that 14 ports accounted for 75 percent of all loading calls in 1975 (Ras Tanura being the most important). There were several ports of almost equal importance in medium-sized tanker discharge schedules for which a high incidence of multi-porting was recorded, especially at ports in north and south Europe and Japan. Most loading ports were capable of handling VLCCs but substantially fewer discharge ports, the U.S. East and Gulf Coasts being the most notable area where lightening was necessary.
The section on employment concludes with a discussion of the relationship between actual employment and estimated demand for medium-sized tonnage in 1975 by discharge area, and estimates real demand to have been 47.5 million dwt, equivalent to only 77 percent of the available tanker fleet. Including combined carrier medium-sized tonnage operating in oil trades, the total real demand was about 60 million dwt, resulting in an overall surplus of about 30 million dwt.
The final section of the study contains a discussion and evaluation of future demand and supply for medium-sized tonnage.
Demand for all medium-sized tonnage, based on estimated development of port and refinery capacities, is forecast to be between 84 and 94 million dwt, while supply ranges from 83 to 96 million dwt, depending on new deliveries, different rates of scrapping, and allowing for only 25 percent of combined carrier tonnage in oil. The enlargement of the Suez Canal is not likely to greatly improve the prospects for medium-sized tankers, but this will depend on the Suez Canal tariff. Segregated ballast regulations, if introduced, would cause a reduction in cargo-carrying capacity, thereby reducing mediumsized tanker and combined carrier availability to about 80 million dwt in 1980. The prospects for medium-sized tankers in 1980, considering the greater volume of combined carriers likely to be available, but not allowing for the imposition of segregated ballast regulations, is likely to be one of surplus of supply of between 10 percent and 20 percent, compared with 30 percent in 1975.
"The Market for Medium-Sized Tankers (70-175,000 dwt)," No.
47 in a series of reports on various aspects of shipping prepared by the Research Division of H.P.
Drewry (Shipping Consultants) Limited, Palladium House, 1-4 Argyll Street, London W1V IAD, England, is available at a single copy rate of $75 (all overseas orders), or on a subscription basis $250 (all overseas orders), for the series 41-50.
Other stories from January 1977 issue
- Title XI Financing Approved For Tankers page: 4
- Sulzer Receives Order For Combined LPG/LNG Reliquefaction System page: 4
- MarAd Approves Title XI For Two Barge Operators Valued At $10.3 Million page: 6
- American Heavy Lift Requests CDS To Build Two $14-Million Vessels page: 6
- Marinette Marine Completes $8-Million 20-Vessel Gunboat Contract On Schedule page: 7
- $12.5-Million Contract Awarded For Tampa 900-Foot Drydock page: 7
- Atlantic Marine Delivers Unusual Tug To Lago Oil To Handle VLCCs At Aruba page: 7
- DOT Approves Two Offshore Superports For Large Tankers page: 7
- Scindia Lines Plans $122-Million Ship Building Program page: 7
- MSB Approves States And MorMac Exchange Of Vessels page: 8
- Whitehall Club Elects J.J. Henry President page: 8
- Giant Aluminum LNG Sphere 12 Stories High Arrives At General Dynamics Quincy Yard page: 8
- Suderman & Young Towing Elects Rayzor President page: 9
- S/S United States Offered To High Bidder —Minimum $5 Million page: 9
- NASSCO Delivers 90,000-DWT Chestnut Hill- Lays Keel For Fourth San Clemente-Class Tanker page: 9
- Marine Section, NSC, Presents A w a r d s - Elects Officers At National Convention page: 10
- CF Industries Names R.A. Wilson To Head Transportation Group page: 10
- Exxon Awards IMODCO Contract To Construct Offshore Facility page: 10
- Some Aspects Of Large Floating Docks page: 12
- Uniflite, Inc. Delivers Four High-Speed Patrol Boats page: 12
- Prudential Lines Signs Contract For MARISAT Terminals For Entire LASH Fleet page: 12
- Sea Container Affiliate Signs Letter Of Intent For Four Containerships page: 14
- San Diego Sections Of SNAME And ASNE Hear Description Of SUBDEVGR1 Functions page: 14
- Steel Style Delivers Jumbo Floating Drydock page: 14
- N.Y. SNAME Section Hosts Port Engineers And Institute Of Marine Engineers At Technical Meeting page: 14
- Tankers To Install AIRFILCO Engineering Inert Gas Systems page: 16
- Manfred Krutein Opens Marine Consulting Office page: 16
- Offshore Jackup Systems Available In Kit Form From Baker Marine page: 18
- M / G Transport Services Announces Major Senior Management Staff Changes page: 19
- Drillship To Install Sperry Marine Systems Sensing Equipment page: 19
- MSB To Compute Estimated Foreign Cost Of Bulk Carriers page: 19
- SNAME Chesapeake Section Hears Paper On Level Flotation—Research To Regulation page: 19
- H.P. Drewry Reports On The Market For Medium-Sized (70-175,000 DWT) Tankers page: 20
- Gamlen America Names Joseph Nolet Manager Marine Development page: 20
- Halter Marine Services Delivers First Boat To New Company page: 22
- Tanker Built In Spain First To Use New Litton Navigation System page: 23
- Northwest Marine Gets $1.4-Million Contract page: 24
- Sun Releases Analysis Of World Tanker Fleet page: 24
- American Waterways Operators Approve Budget For 1977 page: 25
- Brochure Features New Murphy 232 Marine Diesels page: 25
- Adm. Ralph Cousins Elected President Of Newport News Shipbuilding & Dry Dock Co. page: 25
- Two Farrell Lines Containerships Being Lengthened 144 Feet By Avondale page: 28
- Henry Diercxsens Named Vice President Atlantic Overseas Corp. page: 28
- Worthington Pump Appoints S.V. Ardia page: 29
- Microwave Indicator Tells Level Of Liquid Cargoes Aboard Ship page: 29
- Port Of Houston Terminal Installs Three LeTourneau 50-Ton Straddle Hoist Cranes page: 30
- Dravo Launches 40th Viking-Class Towboat page: 30
- C-E Marine Power Systems Names Robertson And Sabo page: 31
- Diamond Delivers Revolving Crane Trucks To N.C. State Ports page: 31
- TMT Adds Two Double-Deck Barges To Florida-Puerto Rico Operations page: 32
- Equitable Launches First Of Two Ferries For Louisiana Department Of Highways page: 32
- Don Macauley Joins Atlantic Cordage Corp. As Marketing Manager page: 32
- Apelco Announces New Marine Radiotelephone page: 32
- Second 'Catug' Unit For Hvide Shipping Christened At Galveston page: 33
- Coast Guard Orders ENVIROVAC Systems page: 33
- Mangone Ship Delivers 150-Foot Tugboat To Norwegian Owners page: 34
- GE Appoints Noonan Ma nager Of Marketing For Marine Gas Turbines page: 34
- MMC Introduces New Continuous Reading Tank Gauging System page: 34
- CF Industries Names David Titus Manager Seagoing Operations page: 34
- Maritime College Alumni Name Norman Lee 1976 Man Of The Year page: 36
- Saudi Arabia Bars Old Ships From Ports To Reduce Congestion page: 36
- Samson Ocean Systems Describes Pierside Mooring Systems page: 37
- Crowley Appoints Three In Caribbean Division page: 37
- Empire Abrasive Describes Improved Blasting Nozzle page: 37
- Seatrain Appoints Magee To New Executive Post page: 38
- ADDSCO Promotes Bitowf And Roy page: 38
- Walter Kidde To Sell U.S. Lines To WUI, Inc. page: 39
- Bath Iron Launches Fourth Ro/Ro Ship For States Steamship page: 39
- New Waste Oil Dehydrator Operating On Houston Channel page: 40
- Canada Extends Subsidy To Include Conversions page: 41
- Jurong Shipyard Wins $13-Million Contract page: 41
- H.P. Drewry Reports On Tanker Owners' Future page: 41
- Drew Chemical Announces New Chemical Fuel-Oil Additive page: 42
- Northwest Marine Christens Barge Alaska page: 42
- The Cordage Group Promotes W.S. Stroud And P.S. Bowes page: 43
- Keppel Shipyard Converting Ships To Livestock Carriers page: 43
- Halter Delivers Versatile 195-Foot Offshore Supply Vessel page: 43
- Alabama Docks Buys Land For Expansion page: 43