World Bunkering > News > Spring 2009 > North Europe - Is Rotterdam facing a slowdown?

Over the last year, it has sometimes seemed that Singapore and the Middle East were the regions benefiting most from the investment in new barges, as major players sought to expand their influence in key areas, or move into new markets. In Northern Europe, meanwhile, fleet levels remained steady. However, there have been developments in this region as well.

Chemoil adds newbuild

In late January this year, Chemoil added a new dedicated barge dedicated to supplying low-sulphur fuel to its Rotterdam fleet. The company says that the “superior newbuild” will improve the efficiency and safety of its services as demand for LSFO continues in the Antwerp-Rotterdam-Amsterdam region. The new barge, Laurentien, is time-chartered from FTS Hofftrans, and has a range of advanced capabilities that are suited to LSFO deliveries including fast pumping capabilities of 500/600 metric tons per hour to ensure quick customer turnaround times. It is also double-hulled and double-bottomed to meet MARPOL Annex I safety standards.

Chris Stoddard, Managing Director, Chemoil Europe B.V., said: “Chemoil has been at the forefront of supplying LSFO in Rotterdam for a number of years. We were the first suppliers to dedicate barges to the exclusive delivery of LSFO in order to maintain the highest quality and service standards. Going forward, it is essential that we continue to strengthen this delivery aspect of our supply chain and support this with the utilisation of appropriate vessels.

“As customers face increasing cost pressures during these challenging economic times, it is essential that every aspect of our operation is focused towards providing them with the quickest, safest and most flexible service so that they can minimise time spent refueling and focus on their core business, safe in the knowledge that their bunkering needs are taken care of.”

Aegean renews fleet

Chemoil is not the only owner to be investing in the region. Aegean is another owner that has been spending heavily on fleet replacement, and added the 4,600 dwt Syros to its Antwerp fleet in June last year. The Syros, part of a series built at the Fujian Southeast shipyard in China, replaced an older vessel, the 1985-built Vera, a single-hull tanker, which Aegean has redeployed in West Africa. According to Nikolas Tavlarios, president of Aegean, “With the delivery of the Syros, Aegean has once again expanded its global logistics infrastructure. By successfully increasing our delivery capacity, we have enhanced our ability to meet the strong demand in our growing network for the physical supply of marine fuel and further grow sales volumes.”

Prospects for 2009

But while Rotterdam continues to boast one of the most high-tech, and one of the most active, bunker fleets in the world, it seems doubtful whether the market will expand this year. Back in 2008, Olexander Butsan, finance director at Litasco, which has between 10 and 15% of the market in the ARA region, said that volume in 2008 was expected to be similar to that in 2007 due to the massive increase in fuel prices, which was leading owners to take fuel elsewhere. Prices have since fallen to more manageable levels, but the massive drop in oil prices – and the drop in commodity prices and world trade generally – is also likely to have an impact on the bunker market if the number of vessel calls drops off. Bunker sales in 2008 showed no increase over 2007, and are expected to remain steady or fall slightly in 2009.

According to predictions from the Port of Rotterdam, that is exactly what is likely to happen over the next year. Throughput was up in 2008 by a total of 2.7% over the previous year despite a poor last quarter. According to Hans Smits, CEO of the Port of Rotterdam Authority: “Rotterdam is one of the most important hubs of global trade. If this decreases, we follow and vice versa. Certainly, throughput will initially fall very substantially in 2009. On average, however, we will be able to achieve 100 million tonnes per quarter and a 5-8% drop. We would be happy if we can achieve 400 million tonnes.” Last year, total throughput was 420 million tonnes.

The liquid-bulk sector has always been a particularly important sector in Rotterdam, as many tankers take advantage of the port call to take bunkers, is likely to see a considerably drop. As of September throughput fell due to the falling demand for oil products and maintenance shutdowns. Due to the recession the demand for oil products will remain low and consequently so will the refining margins, the port said. The throughput of crude oil will therefore drop in 2009 in the direction of 95 million tonnes. Fuel oil remains by far the most important product with probably over 25 million tonnes going through the port each year. Russia remains the main supplier, with Brazil being the “newcomer”. The import of gas oil profited from supplementing of stocks in Germany and Switzerland.

By contrast, the biofuel sector, including ethanol, from Brazil, and biodiesel (much of it B99 from the US), performed very strongly in 2008, with total throughput increasing by 2.8 milllion to approx. 5.3 million tonnes. More palm oil and sunflower oil were also imported. A change in American government policy may result in the import of B99 falling in 2009, meaning that an increase in the intra-European transport is likely. This is likely to cause further demand for storage, which had already been a problem in 2008, according to Butsan: “When planning strategy for the year ahead, we have to take into account that rates for storage facilities are growing. This is in part because of increased competition for storage with biodiesel firms. We used to be able to get a fixed rate for a number of years, but now tank storage firms want to reconsider rates every year,” he said.