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Tanker Fleet Grows by 203 Units in a Year



  • Customs Increases Exchange Rate For Duty Payment To N282 Per Dollar

After a period of very limited tanker fleet growth across all but the MR sector, the tanker fleet has surged over the past twelve months by another 203 units amounting to 21.9 million dwt, according to Gibson Shipbrokers.

The strength of the tanker market during the low oil price regime meant that owners have had little for scrapping as bunker prices headed south improving their margins still further.

Eco-ships no longer held any significant advantage as legislation on environmental issues continued to keep its distance resulting in demolition numbers falling to a mere 34 tankers, representing 2.5 million dwt, over the past year.

Of the 366 tanker orders placed last year, 218 were contracted in the second half of the year, although many were placed to circumvent the higher costs associated with the new Tier III regulations which came into force on January 1 in the US.

Newbuilding prices themselves had been slowly falling since June 2014 but had a small resurgence over the fourth quarter of 2015.

However, the appetite for new orders across all the tanker sectors has evaporated this year despite renewed falls in pricing and the mounting pressure on shipbuilders to fill their forw

Furthermore, finance appears to have “ended its love affair with the shipping industry, mostly driven by the disastrous state of affairs in the dry cargo market, but also the high tanker orderbook and the spate of deliveries scheduled for 2016/17,” Gibson said.

In the first half of this year 14 million dwt has already been delivered compared to the 17 million dwt in the whole of 2015.

Despite the strong earnings across most tanker sectors over the past two years, second-hand values have also come under downwards pressure since the turn of this year as freight rates began to decline.

The second half of the year is expected to remain challenging particularly with such a heavy delivery profile scheduled, according to Gibson, reports World Maritime News.

“Earnings across most sectors started the year quite strongly although crude began to slump recently, while the products sector has experienced a tough six months. Of course the health of the tanker market remains very much in the hands of the producers and the decisions that they make regarding future production,” Gibson said.

“However, we still need to keep a watchful eye on the orderbook and hope that new orders remain in check.”

In the meantime, the Nigeria Customs Service has increased the exchange at which it calculates tariffs from previous N197 to N282 to a dollar. The increase was confirmed last Friday by Shipping Position Daily.

The Customs service had earlier in the year attempted an increase in the exchange rate to N285 for the purpose of calculating payable duty and rates, but it was denied.

The Customs National Public Relations Officer; Mr. Wale Adeniyi had at the time denied the report, stressing that the extant rate issued by CBN which was N197 remains the basis for duty calculation.

But our correspondent authoritatively confirmed at the weekend that the Customs rate of duty calculations has finally been changed at various command across the country to N282 per dollar.

Public Relations Officer of Customs at Tin Can Island Command, Mr. Chris Osunkwo confirmed to Shipping Position Daily  last Friday that, “from our system, the exchange rate has been changed this morning to N282″.

He explained that ‎there was a circular issued by the CBN to the customs in 2016 stating clearly that payable duty on all imports would be calculated and subjected to market forces.”There is a circular dated 28 May 2015/No 015 with the heading; Application of Exchange Rate at the Time of Making Entry. It states that where the value of an imported goods is shown in foreign currency, such value is to be converted to the equivalent of Nigerian currency as at the rate at the time of making declaration to customs”

“Going by the provisions of this circular, it is quite clear and incontrovertible that the exchange rate has changed”, he told our correspondent.

Osunkwo however cleared that determining the duty is not a Customs affair, he said the directive is from the Central Bank of Nigeria (CBN) and customs only applies the laws.”We are all observing if government wants to liberalise the‎ exchange rate in such a manner that customs would be calculating as provided by the circular. It means that if we wake up tomorrow to see the dollar dropped to N200, it means we would apply N200″

“For quite some time, we have been too liberal, such that the exchange rate, (no matter what prevailed) still remains at N197, but if you go by the law, it means that we have to fluctuate by what the foreign exchange market says now”, Osunkwo cleared.

He told our correspondent that some clearing agents have expressed worry at the development and had consequently been asking questions. He however assured that the clarification has been brought to the notice of some of the agents.

Also clearing and forwarding agents at the nation’s ports have warned that prices of commodities will now continue to increase at the markets.Speaking to Shipping Position Daily on the development, a Licensed Customs Agent, Mr. Bolade Oladipo Lawrence lamented that the new duty rate will automatically increase the price of clearing cargoes at Nigerian ports.

He however said that clearing agents are not ready to protest the new increase, stressing that it is the duty of Shippers associations and importers group to speak up.”It will change PAAR and affect virtually all other revenue charges‎, it then means that price of clearing vehicles will be higher and it would be passed to the final consumers”

“Some section of agents might begin to react to it, but you agree with me that it is the importers that are bringing the goods down here, the shippers association and the importers are the ones that should react””We are just an intermediary between them and the government, we should not be expected to take the lead reaction, we are watching them” he said.

World Maritime News with additional report from Shipping Day


WAIVER CESSATION: Igbokwe urges NIMASA to evolve stronger collaboration with Ships owners



…Stresses the need for timely disbursement of N44.6billion CVFF***

Highly revered Nigerian Maritime Lawyer, and Senior Advocate of Nigeria (SAN), Mike Igbokwe has urged the Nigeria Maritime Administration and safety Agency (NIMASA) to partner with ship owners and relevant association in the industry to evolving a more vibrant merchant shipping and cabotage trade regime.

Igbokwe gave the counsel during his paper presentation at the just concluded two-day stakeholders’ meeting on Cabotage waiver restrictions, organized by NIMASA.

“NIMASA and shipowners should develop merchant shipping including cabotage trade. A good start is to partner with the relevant associations in this field, such as the Nigeria Indigenous Shipowners Association (NISA), Shipowners Association of Nigeria (SOAN), Oil Trade Group & Maritime Trade Group of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA).

“A cursory look at their vision, mission and objectives, show that they are willing to improve the maritime sector, not just for their members but for stakeholders in the maritime economy and the country”.

Adding that it is of utmost importance for NIMASA to have a through briefing and regular consultation with ships owners, in other to have insight on the challenges facing the ship owners.

“It is of utmost importance for NIMASA to have a thorough briefing and regular consultations with shipowners, to receive insight on the challenges they face, and how the Agency can assist in solving them and encouraging them to invest and participate in the maritime sector, for its development. 

“NIMASA should see them as partners in progress because, if they do not invest in buying ships and registering them in Nigeria, there would be no Nigerian-owned ships in its Register and NIMASA would be unable to discharge its main objective.

The Maritime lawyer also urged NIMASA  to disburse the Cabotage Vessel Financing Fund (CVFF)that currently stands at about N44.6 billion.

“Lest it be forgotten, what is on the lips of almost every shipowner, is the need to disburse the Cabotage Vessel Financing Fund (the CVFF’), which was established by the Coastal and Inland Shipping Act, 2003. It was established to promote the development of indigenous ship acquisition capacity, by providing financial assistance to Nigerian citizens and shipping companies wholly owned by Nigerian operating in the domestic coastal shipping, to purchase and maintain vessels and build shipping capacity. 

“Research shows that this fund has grown to about N44.6billion; and that due to its non-disbursement, financial institutions have repossessed some vessels, resulting in a 43% reduction of the number of operational indigenous shipping companies in Nigeria, in the past few years. 

“Without beating around the bush, to promote indigenous maritime development, prompt action must be taken by NIMASA to commence the disbursement of this Fund to qualified shipowners pursuant to the extant Cabotage Vessel Financing Fund (“CVFF”) Regulations.

Mike Igbokwe (SAN)

“Indeed, as part of its statutory functions, NIMASA is to enforce and administer the provisions of the Cabotage Act 2003 and develop and implement policies and programmes which will facilitate the growth of local capacity in ownership, manning and construction of ships and other maritime infrastructure. Disbursing the CVFF is one of the ways NIMASA can fulfill this mandate.

“To assist in this task, there must be collaboration between NIMASA, financial institutions, the Minister of Transportation, as contained in the CVFF Regulations that are yet to be implemented”, the legal guru highlighted further. 

He urged the agency to create the right environment for its stakeholders to build on and engender the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders.

“Lastly, which is the main reason why we are all here, cessation of ministerial waivers on some cabotage requirements, which I believe is worth applause in favour of NIMASA. 

“This is because it appears that the readiness to obtain/grant waivers had made some of the vessels and their owners engaged in cabotage trade, to become complacent and indifferent in quickly ensuring that they updated their capacities, so as not to require the waivers. 

“The cessation of waivers is a way of forcing the relevant stakeholders of the maritime sector, to find workable solutions within, for maritime development and fill the gaps in the local capacities in 100% Nigerian crewing, ship ownership, and ship building, that had necessitated the existence of the waivers since about 15 years ago, when the Cabotage Act came into being. 

“However, NIMASA must ensure that the right environment is provided for its stakeholders to build and possess the needed capacities to fill the gaps; and ensure that steps are being taken to solve the challenges being faced by stakeholders. Or better still, that they are solved within the next 5 years of its intention to stop granting waivers”, he further explained. 

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The Burial Ceremony of Engr. Greg Ogbeifun’s mother is live. Watch on the website: and on Youtube: Maritimefirst Newspaper.

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Wind Farm Vessel Collision Leaves 15 Injured



…As Valles Steamship Orders 112,000 dwt Tanker from South Korea***

A wind farm supply vessel and a cargo ship collided in the Baltic Sea on Tuesday leaving 15 injured.

The Cyprus-flagged 80-meter general cargo ship Raba collided with Denmark-flagged 31-meter wind farm supply vessel World Bora near Rügen Island, about three nautical miles off the coast of Hamburg. 

Many of those injured were service engineers on the wind farm vessel, and 10 were seriously hurt. 

They were headed to Iberdrola’s 350MW Wikinger wind farm. Nine of the people on board the World Bora were employees of Siemens Gamesa, two were employees of Iberdrola and four were crew.

The cause of the incident is not yet known, and no pollution has been reported.

After the collision, the two ships were able to proceed to Rügen under their own power, and the injured were then taken to hospital. 

Lifeboat crews from the German Maritime Search and Rescue Service tended to them prior to their transport to hospital via ambulance and helicopter.

“Iberdrola wishes to thank the rescue services for their diligence and professionalism,” the company said in a statement.

In the meantime, the Hong Kong-based shipowner Valles Steamship has ordered a new 112,000 dwt crude oil tanker from South Korea’s Sumitomo Heavy Industries Marine & Engineering.

Sumitomo is to deliver the Aframax to Valles Steamship by the end of 2020, according to data provided by Asiasis.

The newbuild Aframax will join seven other Aframaxes in Valles Steamship’s fleet. Other ships operated by the company include Panamax bulkers and medium and long range product tankers.

The company’s most-recently delivered unit is the 114,426 dwt Aframax tanker Seagalaxy. The naming and delivery of the tanker took place in February 2019, at Namura Shipbuilding’s yard in Japan.

Maritime Executive with additional report from World Maritime News

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