Massive Canadian rail disruptions move closer
A Canadian rail workers union and two major Canadian railroads moved closer to a disruptive nationwide strike on 22 August, with the union issuing on Sunday a 3-day strike notice to Canadian Pacific Kansas City (CPKC) and fellow railroad Canadian National (CN) telling the union it will lock employees out that same day.
A strike by workers from the Teamsters Canada Rail Conference would cause widespread disruptions to commodity deliveries across North America. The major carriers last week began to embargo shipments of hazardous materials between the US and Canada.
Canadian National expects to issue new embargoes today. Its shutdown plan began last Monday.
"Unfortunately, we have no choice but to keep moving forward with this plan which means that by Thursday morning, no goods will be moving on the railroad," the railroad said.
CPKC similarly began to implement shutdown plans last week. Tomorrow it will begin embargoing all shipments originating in Canada and all US shipments headed to Canada.
Contracts between the Teamsters and each railroad expired at the end of last year. Employees have continued to work under those agreements but that is nearing an end as the parties remain far apart on many issues including pay and work hours.
The union and railroads' strategies differ. The Teamsters so far have only issued a strike notice at one carrier. Contract negotiations are occurring separately with each railroad.
"The only reason we served strike notice at [Canadian Pacific Kansas City] is because the company was set to cancel our expired collective agreements," the union said. "This would have created a situation where our members had no rights or protections at work."
The union claimed CPKC is pressuring it for concession that would make it " harder for workers to predict when they might be called for work, creating a fatigue-related safety risk." The union also said the carrier was trying to change work rules related to being held away from home, and undermining Canada Labour Code provisions.
CPKC in turn told the Teamsters it will lock out employees on 22 August unless the two parties are able to come to either a negotiated agreement or agree to binding arbitration.
The Teamsters said late Sunday that, at that time, it did not intend to issue a strike against Canadian National. But Canadian National said it will lock employees out "unless an agreement or binding arbitration is achieved" before before 12:01am ET on 22 August.
"Despite negotiations over the weekend, no meaningful progress has occurred, and the parties remain very far apart," Canadian National said.
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Bulk carriers mostly score low CII in 2023
Bulk carriers mostly score low CII in 2023
New York, 20 August (Argus) — More than half of bulk carriers scored carbon intensity indicator (CII) grades of C or lower on an A-E scale in 2023, according to International Maritime Organization (IMO) data. About 61pc, or 9,127 of all bulk carriers sized 5,000 gross tonnes (gt) and over that reported their energy efficiency, scored C, D or E on the CII scale in 2023, according to the IMO data. IMO's CII regulation, which came into force in January 2023, requires vessels over 5,000 gt to report their carbon intensity, which is then scored from A to E. A and B vessel scores are regarded as superior energy efficiency, while C, D and E are considered moderate to inferior scores. The scoring levels are lowered yearly by about 2pc, so even a vessel with no change in CII could drop from from C to D in one year. If a vessel receives a D score three years in a row or E score in the previous year, the vessel owner must submit a corrective actions plan. To improve its CII score, a ship owner could reduce its speed and burn low-carbon fuels, among other solutions. Global marine fuel demand from vessels of 5,000 gt and above dropped by 1pc to 211.1mn t in 2023, down from 213.4mn t in 2022, according to the latest IMO data. The drop could be attributed to the global economic slow-down in 2023, as well as vessels employing slow steaming to reduce marine fuel consumption. Residual fuel oil bunker demand was down by 2pc to 170.9mn t in 2023 from the previous year, according to IMO data. The IMO does not report separately high-sulphur and low-sulphur fuel oil demand. Global marine gasoil (MGO) demand fell by 6pc to 26.6mn t. An increase in methanol and LNG for bunkering demand offset some of the conventional marine fuel declines. LNG for bunkering demand rose by 18pc to 12.9mn t and methanol increased by 2.6 times to 93,876t. In 2023, container ships, bulk carriers and tankers accounted for 31pc, 30pc and 21pc, respectively, of global residual fuel oil bunker demand. Containers ships and bulk carriers accounted for the majority of the MGO demand, 18pc and 15pc, respectively. Tankers accounted for 93pc, or 87,319t, of total methanol demand and LNG carriers accounted for 89pc of LNG for bunkering demand, or 11.5mn t. By Stefka Wechsler Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Nigeria sees significant gasoline output by November
Nigeria sees significant gasoline output by November
Lagos, 20 August (Argus) — Nigeria's government said "significant production increases" of gasoline from the 210,000 b/d Port Harcourt and 650,000 b/d Dangote refineries are "expected from November", which would have ramifications for balances in the region and in northwest Europe. First gasoline from Dangote is expected in September, said the office of Nigeria's co-ordinating minister of the economy. Industry sources told Argus that Dangote obtained regulatory approval to start its 247,000 b/d fluid catalytic cracker and 27,000 b/d alkylation units in April and May, respectively, but that the refiner seems to have deliberately delayed start-up of these secondary units. This is because it plans to sell much of its gasoline to the domestic market, where government intervention through state-owned NNPC continues to curtail prices. Sources at Port Harcourt told Argus that the restart of a 60,000 b/d section that has been delayed several times since April 2023 is on course to happen by 31 August. The refinery received 450,000 bl of domestic Bonny Light crude in the first half of July, the second supply of feedstock after 475,000 bl arrived between 28 December and 18 January. Nigeria's downstream regulator approved the movement of the crude from tank to refinery at the end of July, sources said. NNPC's trading subsidiary applied last week for permits to sell Port Harcourt kerosine and diesel domestically and permits to export naphtha and fuel oil, according to industry sources. The catalytic reformer and the reformer feed unit for the 60,000 b/d section will start early in October for upgrading of naphtha, sources said. Italian engineering firm Maire Tecnimont won a $1.5bn contract in April 2021 to restore Port Harcourt to 90pc of its nameplate capacity. It said in June that the project was 84.6pc complete, with procurement at 99pc, engineering at 98pc and construction at 73pc. The co-ordinating minister's office also said a programme for NNPC to sell crude to Dangote in the local naira currency will start on 1 October. NNPC has supplied Dangote with crude since the refinery started up in December 2023, but payments have so far been in dollars. The government said the programme will offer a "lifeline to Dangote refinery", which has complained about the dollar prices and available volumes of Nigerian crude grades it has been able to buy. Sources told Argus that NNPC sold Dangote more than 3.6mn bl of crude in July, including a 720,000 bl cargo of Brass River — the first of that grade. A government source told Argus today that details of the NNPC-Dangote programme will not be disclosed until after its implementation in September. But it could be structured as a crude-for-gasoline swap, denominated in US dollars and reflecting international market prices but settled in the equivalent naira amounts. This would allay Dangote's concerns about dollar expenditure, guarantee sales and ensure market value for gasoline sold domestically. It would also remove NNPC's need to import gasoline, with Dangote's capacity alone exceeding Nigeria's domestic demand. NNPC has been Nigeria's sole importer of gasoline since 2017, with the exception of about eight cargoes received by independents in 2023. After years of crude-for-gasoline swap deals, NNPC has been importing on a cash basis since November 2023, mainly from the Amsterdam-Rotterdam-Antwerp (ARA) hub in northwest Europe. Nigeria is the largest consumer of gasoline in west Africa, and a key outlet for excess European production. By Adebiyi Olusolape Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
EU HRC: North nudges up, import offers soften
EU HRC: North nudges up, import offers soften
London, 20 August (Argus) — North European hot-rolled coil prices rose slightly today in continued quiet trading, as some mills sought a rollover for October rolling. Argus ' daily northwest EU HRC index rose by €1.75/t to €591/t ex-works, while the daily Italian index was unchanged at €595.25/t as the August holiday continued to quieten trade. The twice weekly cif Italy assessment nudged down by €7.50/t to €555/t cif. A major European steelmaker officially offered to northern buyers at €630/t, but buy-side sources said this level was much too high because of weak demand. Service centres in Germany and the Benelux reported losing cut-to-length deals below €700/t, and as low as €670/t ex-works from some mill-tied distributors. While most offers were around €600-620/t base, they expected to buy below for a reasonable tonnage as mills looked to fill their rolling programmes. One producer appears less hungry, despite not offering widely for October yet, as it is sending coil and slab to the UK. Projects have been postponed because of the high interest rate environment, which means service centre inventories are not moving as quickly as anticipated — however they are not highly stocked, as everyone has been managing stock levels, especially those who are approaching their financial year-end. One processor said projects booked earlier in the year for October have been pushed back into the second quarter, given high interest rates. A buyer quoted a rollover around €610/t said mills should have pushed for slight increases to try and stop the market falling. With pressure on costs, as Chinese steelmakers reduce their production, some suggested there would be further downside for coil prices as mills will have more wiggle room without sacrificing margin. Traders said €560/t could be a viable price from domestic producers should costs continue to soften. Some expected the Chinese steel market to be close to bottoming, and a flurry of short covering could stabilise prices, helping sentiment in the global marketplace. Chinese HRC was offered into Antwerp today around €600/t by at least one trader, although there are negotiations ongoing against another offer tabled as low as $510/t cfr, which is around €540/t including duties at today's exchange rate with dumping and countervailing measures of 18.1pc. Sustained decreases in Chinese HRC prices have filtered into lower offers for HRC, especially from some Asian sellers. The softening is exacerbated by the strengthening of the euro against the US dollar, making dollar-denominated offers work out lower in euro than last week. A Vietnamese mill was confirmed to offer at €535-540/t cfr EU, but it was struggling to find any interest. India was reported at €560-575/t cfr south EU. One offer from a Turkish mill stood at just under €560/t cfr Italy last week, whereas another mill was heard offering HRC at between €570-590/t cfr, duty included. Trader offers have been made at a premium to these prices, especially for some higher-quality Asian material, although one seller was heard close to the Vietnamese offer. Japanese cold-rolled coil was offered into Antwerp at €665/t fca, down around €20/t over the last week. Feedback from buyers was limited, with many still absent from the market for holidays. In the futures market today, October traded twice at €616/t on the CME Group's north European contract, while two fourth quarter strips traded later in the day at €630/t. Blast furnace outages in the EU Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Nigeria's Dangote sells another urea cargo
Nigeria's Dangote sells another urea cargo
Amsterdam, 20 August (Argus) — Nigerian fertilizer producer Dangote has sold a further 30,000t of granular urea to a trading firm, likely priced in the high $320s/t fob, marking the supplier's third sale in a week. There was no comment from the parties involved regarding price or loading period. This cargo will likely load between end-August and early September. Dangote had sold a 30,000t granular urea cargo early last week at $326-327/t fob for second-half August loading and another towards the end of last week at a slightly higher level for first-half September shipment. By Dana Hjeij and Harry Minihan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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