This is a legacy page. Please click here to view the latest version.
Fri 16 Feb 2018, 10:25 GMT

Odfjell posts rise in FY and Q4 2017 bunker costs


Average bunker cost per tonne was up 10.6% in 2017.



Shipping company and terminal operator Odfjell reports that its average bunker cost per tonne (including the effect from bunker adjustment clauses) during the whole of 2017 was $387, representing a year-on-year (YoY) increase of $37, or 10.6 percent, on the previous year's figure of $350 per tonne.

Odfjell posted full-year net bunker costs of $152.8 million, which included $142.2 million in bunker purchases, with the rest comprising costs associated with fuel hedging and bunker clauses.

2017 bunker cost summary

Q1:
Total net bunker cost: $38.6m
Bunker purchases: $35.8m

Q2:
Total net bunker cost: $37.3m
Bunker purchases: $34.3m

Q3:
Total net bunker cost: $37.8m
Bunker purchases: $34.1m

Q4:
Total net bunker cost: $39.1m
Bunker purchases: $38.0m

Fourth-quarter bunker costs

Odfjell reported fourth-quarter (Q4) net bunker costs of $39.1 million, including $38.0 million in bunker purchases - a YoY rise of $5 million, or 14.7 percent.

In a sequential, quarter-on-quarter (QoQ) comparison, the figure was up $1.3 million, or 3.4 percent.

Fourth-quarter bunker averages

The average bunker price paid by Odfjell's chemical tankers in Q4 was up compared to the previous three-month period.

On average, the Norwegian firm says its chemical tanker fleet paid $347 per tonne in Q4, which was $13, or 3.9 percent, higher sequentially.

Odfjell's average bunker cost of $398 per tonne (including the effect from bunker adjustment clauses) in Q4 represents an increase of $56, or 16.4 percent, YoY.

In a sequential comparison with Q3, the mean bunker cost was up $15, or 3.9 percent.

Hedging

On the issue of risk, Odfjell said bunker clauses in contracts of affreightment (COAs) cover around 64 percent of its marine fuel exposure.

Key financial results

In its overall results, Odfjell posted a full-year (FY) net income of 82.7 million - 17.3 percent below the $100 million profit achieved in 2016.

In Q4, Odfjell managed to more than double net income to $96.4 million, compared to $43.5 million during the prior-year period. The positive result follows two consecutive quarterly losses of $4.7 million and $10.5 million in Q2 and Q3 respectively.

Commenting on the company's performance, Kristian Morch, CEO of Odfjell SE, remarked: "Our markets have remained challenging in 4Q, but Odfjell continues to make good progress. We have recently achieved our growth ambitions by renewing our fleet and participating in the consolidation in a capital efficient way, and we have at the same time strengthened our balance sheet through disposal of non-core assets."

Odfjell said: "We expect the challenging markets to continue into 2018, but we also expect that 2018 will be a turning point due to improving fundamentals."

The company added that it expects Q1 2018 time charter results to be "marginally better" than in Q4 2017, and Odfjell Terminals results in 2018 to be in line with 2017, but without the contribution from the divested Singapore terminal.


Japan Engine Corporation (J-ENG) logo. Japan Engine Corporation extends ammonia engine licence to Akasaka Diesels  

J-ENG grants domestic partner rights to manufacture alternative-fuel engines for decarbonisation efforts.

Photograph of ship with overlaid encircled text of EU regulations. DNV to host webinar on FuelEU Maritime compliance strategies  

Classification society offers insights as first reporting period closes and verification phase begins.

Photograph of ship with overlaid text showing narrowing MGO-biodiesel price spread. Biodiesel–MGO price spread narrows to $400–500/mt in Northwest Europe  

Bunker One says tighter spread creates opportunities for shipping companies pursuing decarbonisation targets.

Graphic for webinar 'Exmar: preparing to sail using ammonia as a marine fuel'. Exmar to discuss ammonia-fuelled vessel operations in webinar  

Shipowner will explore safety measures and partnerships for new dual-fuel ammonia carriers.

Aerial view of a container vessel. Skuld reports engine damage from CNSL biofuel blends amid rising alternative fuel adoption  

Marine insurer details operational challenges with biofuels, including FAME, CNSL and UCOME across member vessels.

Graphic for Exmar webinar titled titled 'Exmar: preparing to sail using ammonia as a marine fuel'. Event date: 15 April 2026. GRM and Bunker Holding to host webinar on Middle East war's impact on energy markets  

Webinar on 9 March will examine effects on crude oil, bunker and gas markets.

GENA Clean ammonia project pipeline chart, February 2026. Clean ammonia project pipeline reaches 145 MMT by 2034, but delivery concerns mount  

GENA Solutions reports 325 tracked projects, though over 70 have been frozen in 20 months.

Peninsula logo. Peninsula highlights supply chain strength amid Strait of Hormuz closure  

Marine fuel seller emphasises reliability as geopolitical disruption reshapes global bunker markets.

European Union member state flags. World Shipping Council backs EU maritime strategies but calls for faster trade simplification  

Industry body supports port security and decarbonisation measures while urging action on customs barriers.

Luke McEwen, Technical Director at Anemoi Marine Technologies. Anemoi and Lloyd’s Register call for unified approach to wind propulsion performance verification  

Anemoi Marine Technologies and Lloyd’s Register publish paper advocating alignment of verification methodologies.


↑  Back to Top