Newsport-and-shipFitch Affirms Adani Ports At ‘Bbb-‘; Off Rating Watch Negative ; Outlook Negative
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Mar 15, 2025Fitch Affirms Adani Ports At ‘Bbb-‘; Off Rating Watch Negative ; Outlook Negative
Fitch Ratings has affirmed India-based port operator Adani Ports and Special Economic Zone Limited’s (APSEZ) Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘BBB-‘ and removed it from Rating Watch Negative (RWN). The Outlook is Negative. A full list of rating actions is at the end of this commentary.
RATING RATIONALE
The rating affirmation follows the demonstration of adequate funding access by the Adani group following the US indictment of certain board members of another group entity, Adani Green Energy Limited (AGEL), on 20 November 2024.
We believe the risk associated with the group’s liquidity and funding requirements has moderated. However, the Negative Outlook reflects our view that the proceedings and outcome of the US investigations could reveal further weaknesses in the group’s corporate governance practices, which may lead to negative rating action in the near to medium term. Fitch will monitor the investigations for any evidence of weakness in the entities’ governance practices and internal controls, and the impact on APSEZ’s financial flexibility.
The rating continues to reflect APSEZ’s strong business and financial profile, underpinned by a robust portfolio of seaports and adequate liquidity position. Its cash balance of INR77 billion as of December 2024 and strong operating cash flow should cover debt maturities of INR66 billion during the financial year ending March 2026 (FY26) and fund its capex. The company also benefits from flexibility in the pace of execution of its expansion projects.
Fitch assesses the financial profile to be stronger than is commensurate with its ‘BBB-‘ rating. Fitch’s governance assessment, as well as India’s (BBB-/Stable) Country Ceiling of ‘BBB-‘, constrains APSEZ’s rating at ‘BBB-‘. APSEZ benefits from geographically diversified port locations, advanced intermodal connectivity transportation infrastructure and best-in-class operational efficiency. It has high customer retention for about half of its cargo, owing to comprehensive and advanced infrastructure to handle a variety of cargoes.
KEY RATING DRIVERS
Best-in-Class Port Operator – Revenue Risk (Volume): Stronger
APSEZ is India’s largest commercial port operator, handling a quarter of the country’s seaborne cargo through its 14 operational ports and terminals in India. Most are primary ports of call in their regions. Its flagship Mundra Port is the gateway to north-western India. Traffic is mainly origin and destination, with limited transshipment cargo. APSEZ’s advanced transport infrastructure, operational efficiency and integrated logistics solutions that transport cargo from its ports to inland depots via railways have led to market share gains and faster organic throughput growth than its peers and India’s economic growth.
Cargo that is difficult to switch to other ports makes up about half of total throughput. APSEZ continues to diversify its throughput from the west coast, with its east-coast terminals accounting for more than 40% of total throughput. The company’s expanded logistics business covers all of India, with multimodal logistics for warehousing, rail transportation and distribution.
Flexibility in Modifying Tariffs – Revenue Risk (Price): Midrange
APSEZ’s portfolio comprises mainly non-major ports. The private ports have the freedom to fix their own tariffs, which are generally higher than at other Indian ports, but this is justified by APSEZ’s better operational efficiency and connection with the hinterland, as it lowers shippers’ overall logistics costs, according to management.
The company’s take-or-pay contracts accounted for about 12% of port revenue in the financial year ended March 2024 (FY24), with a capacity-weighted remaining contract term of 16 years. Take-or-pay contracts insulate revenue from throughput volatility. The assessment is constrained to ‘Midrange’ due to regulated tariffs at certain ports, although their contribution to APSEZ’s EBITDA is minimal.
Internally Funded Capex – Infrastructure Development and Renewal: Stronger
APSEZ’s medium-term capex plan is well developed, focusing primarily on expanding capacity at key ports to accommodate demand growth, as most major greenfield projects are nearing completion. Its capex plans also involves upgrading ports and enhancing logistics capabilities, including warehousing, bulk rakes and trucking. It has budgeted annual capex of about INR110 billion-115 billion over the medium term. APSEZ has a strong record of managing its port investments, which are mostly discretionary and can be postponed without affecting operations significantly.
Fixed-Rate Bullet Bonds Dominate – Debt Structure: Midrange
APSEZ’s consolidated debt comprises mainly US dollar and Indian rupee bullet bonds. We expect its business strengths, established capital market access and relationships with banks to mitigate refinancing risk. APSEZ also has limited exposure to floating interest rates since the majority of its debt is made up of fixed-rate bonds and notes. The bonds do not benefit from restrictive financial covenants or reserve accounts and it relies on natural hedging to manage foreign-exchange risk. Nearly one-third of its revenue is in US dollars and should be sufficient to service its US dollar debt.
Financial Profile
Fitch’s base case assumes annual cargo volume growth of about 10%-15% and 2%-3% annual tariff growth over the next few years. We forecast an EBITDA margin of about 60% over the period, annual capex of INR115 billion-120 billion and annual cash outflow from acquisitions at the same level as FY24. We have also assumed a dividend payout ratio of 20%-25% per annum. Our base-case total debt/operating EBITDA remains below 2.5x from FY26 to FY28.
Our rating case assumes a haircut from the base case at about 2%-5% in volume and about 1%-2% in tariffs, an additional 2pp-3pp stress on the EBITDA margin, a 20% stress on capex and 10% additional stress on acquisition assumptions. We have assumed a higher dividend payout ratio of 25% per annum. The rating-case total debt/operating EBITDA remains below 3.0x from FY26 to FY28.
PEER GROUP
We view APSEZ as most comparable to JSW Infrastructure Limited (JSWIL, BB+/Positive). Both JSWIL and APSEZ have diverse portfolios and debt profiles with limited protective features. However, APSEZ benefits from a more diverse cargo and counterparty mix, larger scale of operations, and larger portion of cargo throughput due to its longer-term cargo contracts compared with JSWIL. APSEZ’s rating is, however, constrained by its ESG assessment and India’s Country Ceiling. We therefore assess APSEZ only one notch higher than JSWIL despite its much stronger business profile.
Port of Melbourne (issuing entity Lonsdale Finance Pty Ltd: BBB/Stable) is the primary port of call in the State of Victoria and serves Australia’s broader market with limited competition. Its rating benefits from a diversified landlord port business model, long concession life, and low infrastructure development and renewal risk, although its operational scale is much smaller than that of APSEZ. Despite an average net debt/EBITDA of 7.9x against APSEZ’s 3.0x under Fitch’s rating case, Port of Melbourne is rated a notch higher than APSEZ as its overall stronger qualitative attributes support higher leverage, while APSEZ is constrained by its ESG assessment and India’s Country Ceiling.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
– Impairment of financial flexibility, which would be evident from increased funding costs or restricted funding access;
– Evidence of further weaknesses in group entities’ governance practices and internal controls, such as material adverse development from the US investigation;
– Prolonged deterioration in rating-case debt/EBITDA to above 6.0x;
– Lowering of India’s Country Ceiling to ‘BB+’.
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
The rating could be affirmed with a Stable Outlook if risks of any material negative implications from the US investigations do not materialise, while funding access remains intact.
CREDIT UPDATE
APSEZ continued to handle about a quarter of India’s total cargo volume in 9MFY25. Cargo throughput increased by 7% yoy, while revenue rose by 14%, contributed largely by organic throughput growth in Mundra as well as consolidation of results from Astro Offshore, a leading offshore support vessel owner, and Tanzania’s concession starting from 2HFY25.
APSEZ completed the acquisition of its majority stake in Gopalpur Port in FY25 and an 80% interest in Astro Offshore. It has also signed a 30-year concession agreement to operate and manage Container Terminal 2 at the Dar es Salaam port in Tanzania. In addition, India’s first dedicated transshipment hub, Vizhinjam Port, also commenced operation in December 2024.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
APSEZ’s rating is capped by India’s country ceiling
ESG Considerations
APSEZ has an ESG Relevance Score of ‘4’ for Governance Structure due to the complexity of its group structure at the shareholder level, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors.
APSEZ has an ESG Relevance Score of ‘4’ for Group Structure due to the concentration of ownership with a large majority stake held by Adani Group, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors.
The highest level of ESG credit relevance is a score of ‘3’, unless otherwise disclosed in this section. A score of ‘3’ means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch’s ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision.
Source: Fitch Ratings
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Charting The Uncharted: The (Un)Intended Consequences Of Oil Sanctions And Dark Shippingin International Shipping News
17/03/2025
Despite formal restrictions, untracked oil continues to reach global markets, calling into question the true effectiveness of oil sanctions. This column presents a novel ship clustering model to detect ‘dark shipping’ – where tankers disable their location signals to evade detection – linked to sanctioned oil transport. Following Western sanctions on Russia in 2022, officially recorded Russian oil exports declined, but shipments via dark vessels more than doubled. A significant share ultimately reaches non-sanctioning countries. The increased availability of discounted, dark-shipped oil helps keep global prices down.
In recent years, sanctions have become a frequently used tool for Western authorities to curb oil exports from targeted economies, aiming to reduce the latter’s export revenues by restricting access to major markets. However, the broader consequences of such measures remain uncertain – particularly given mounting evidence that some tankers ‘go dark’ by disabling their location signals to evade detection and break the sanctions. Additionally, the effects on the global supply chain are often overlooked, raising further questions about the true impact of these restrictions.
The unauthorised practice known as ‘dark shipping’ has gained increasing attention in the context of sanctions on countries such as Iran, Syria, Venezuela, and Russia (Babina et al. 2023, Laudati and Pesaran 2023, Kilian et al. 2024b, Rodríguez 2025). Despite formal restrictions, untracked oil continues to reach global markets, calling into question the true effectiveness of sanctions in curbing exports. These hidden shipments can, in turn, influence global oil supply, impact energy prices, and reshape trade patterns more significantly than official data alone might indicate.
In a recent paper (Fernández-Villaverde et al. 2025), we present a novel ship clustering model to detect dark shipping linked to sanctioned oil transport. By analysing vessel-specific characteristics, evasive behaviour during signal gaps, and navigational anomalies, we quantify unauthorised tanker shipments across the global crude oil fleet. Using this data, along with state-of-the-art methods for causal inference in time series, we investigate how sanctions and dark shipping affect oil flows, prices, and economic activity in both sanctioning and non-sanctioning countries.
What is dark shipping?
Dark shipping occurs when vessels intentionally disable or manipulate their automatic identification system (AIS), concealing their location, course, and speed from global tracking systems. These AIS gaps enable tankers to load or unload oil without official reporting, often in regions with weak sanction enforcement, such as international waters.
Tankers may either load oil directly from sanctioned ports while their AIS signals are off or conduct ship-to-ship transfers between dark vessels (see Figure 1). By operating covertly, they capitalise on premiums offered by sanctioned producers striving to maintain exports. This mechanism explains how oil from restricted countries continues to reach global markets despite sanctions.
With seaborne transport representing over three-quarters of global crude oil trade (US Energy Information Administration 2024), these evasive tactics can significantly distort official trade statistics. Our research offers a systematic approach to identifying these covert activities and assessing their broader economic impact.
A ship clustering model to identify dark ships
Our study employs a multi-attribute ship clustering model based on extensive AIS records covering the global crude oil tanker fleet from 2017 to 2023. Instead of relying on a single attribute, such as vessel age, the model integrates three key layers of analysis:
1. Vessel characteristics, including the tanker’s age, the number of vessels operated by the same company, and flag registration. We find that vessels with ‘flags of convenience’ (i.e. flags from jurisdictions with lower oversight) and older ships are more likely to exhibit suspicious behaviours.
2. Trip-level information. We track each tanker’s voyages from port to port, noting origins, destinations, and whether it appears near sanctioned countries during an AIS gap. This trip-level view clarifies when a tanker is likely to be picking up or delivering cargo without proper disclosure.
3. Movement dynamics. The model also analyses the frequency, duration, and timing of AIS dark periods, along with anomalies in speed or heading. Crucially, it identifies potential ship-to-ship transfers by detecting instances where two vessels go dark simultaneously while in close geographical proximity.
By integrating these features, we assign a ‘dark score’ to each vessel and trip. A tanker that rarely goes dark and avoids sanctioned regions during AIS gaps is classified as ‘white’, indicating a low likelihood of involvement in covert oil transport. Conversely, a vessel with multiple suspicious voyages, prolonged AIS gaps, and routes closely aligned with sanctioned producers is flagged as ‘dark’.
This approach minimises dependence on external data, such as satellite imagery or ownership records, which may be incomplete or costly. Instead, it leverages widely available AIS data and a structured methodology to systematically detect dark shipping across the global fleet.
Tracking the flows of dark-shipped oil
We find that dark shipping is far from a marginal activity. As shown in Figure 2, from 2017 to 2023, an average of 7.8 million metric tonnes of crude oil per month were exported via dark ships from Iran, Russia, Syria, and Venezuela – equivalent to approximately 43% of total global seaborne crude exports reported in official UN Comtrade statistics. The prevalence of dark shipping also rises significantly following major policy shifts, such as the US withdrawal from the Joint Comprehensive Plan of Action in 2018 and the imposition of oil embargoes and price caps on Russian exports in 2022–2023.
From late 2022 onward, data on Russia suggests that while officially recorded exports declined following Western sanctions, shipments via dark vessels more than doubled. This rechannelling of oil flows appears to have offset much of the expected supply contraction. By effectively increasing oil supply, these untracked shipments may exert downward pressure on global oil prices.
Another key insight is that a significant share of this oil ultimately reaches non-sanctioning countries (e.g. India), often at discounted prices (Hilgenstock et al. 2023, Kilian et al. 2024a). This realignment underscores how oil can bypass formal restrictions when substantial buyers remain outside the sanctioning coalition.
(Un)intended macroeconomic effects
To assess the impact of these flows on global economic activity, we use local projections (Jordà 2005, Barnichon and Brownlees 2019) to analyse how changes in sanctioned oil flows correlate with shifts in industrial production and prices in the US, the EU, and China.
For the US, as a net oil exporter, the increased availability of discounted, dark-shipped oil helps keep global prices down. In the short run, this depresses US oil production and related sectors, as lower global prices reduce revenues. However, US consumers and downstream industries benefit from cheaper imported goods – particularly from China, where lower energy costs enhance manufacturing competitiveness. The net effect is mixed: a short-term contraction in US energy-related industries, offset by long-term gains in broader non-energy sectors due to lower input costs from non-sanctioning countries.
As a net oil importer, the EU faces higher energy costs if sanctions temporarily drive up recorded global oil prices. However, rising export demand from China – whose production benefits from cheaper energy prices – provides a boost to EU manufacturers. The result is a complex dynamic of demand-driven inflation and output expansion, where some sectors benefit from China’s growth while others struggle with higher energy costs.
Access to discounted oil imports lowers energy costs in China, stimulating domestic production. This, in turn, boosts industrial output in both the US and the EU through increased trade, as Chinese manufacturers benefit from cheaper inputs and heightened competitiveness.
Relevance for the future
Our research highlights how oil sanctions have far-reaching aggregate effects beyond the targeted economies, often unexpectedly benefiting countries engaged in global trade. These insights are crucial for policymakers, who must account for the intended and unintended consequences of dark shipping on the global supply chain when designing and adapting oil-related sanctions.
Source: CEPRport-and-ship
17 March 2025
Hellenic shipping news
China State Firms Curb Russian Oil Imports On Sanctions Risks, Sources Sayin Freight News
17/03/2025
Chinese state oil companies are shying away from Russian oil this month, with two importers halting purchases while two others scaled back volumes as they assess compliance following recent U.S. sanctions on Moscow, multiple trade sources said.
Russian oil supplies to top buyers India and China fell sharply following the January 10 sanctions by the former Biden administration targeting Russian producers Gazprom Neft (SIBN.MM), opens new tab and Surgutneftegaz (SNGS.MM), opens new tab as well as insurers and more than 100 vessels to curtail Moscow’s oil revenue.
While Russian shipments to the two Asian countries have rebounded after more non-sanctioned tankers joined the trade, China’s state-run Sinopec (600028.SS), opens new tab and Zhenhua Oil halted purchases of March-loading Russian oil due to concerns over dealing with the sanctioned firms, sources with knowledge of the matter said.
The scaled-back buying by Chinese state players has weighed on Russian oil prices, eating into Moscow’s revenue and putting additional pressure on Russia ahead of a possible ceasefire deal with Ukraine.
A Beijing-based state oil source said his company ceased Russian oil deals as it undertakes more compliance checks and waits for a “clear picture” on a possible Russia-U.S. deal to end the Ukraine war.
The company would resume purchases if talks lead to the U.S. easing or lifting sanctions on Russian oil, the person added, declining to be named or to identify their company as they are not authorised to speak with media.
Surgutneftegaz and Gazprom Neft account for about a third of seaborne shipments of Russia’s Far East flagship grade, ESPO blend. The two export about 1.2 million metric tons to China per month combined, or roughly 300,000 barrels per day (bpd).
A trading executive close to a Russian supplier regularly dealing with Chinese state buyers said the companies were shunning oil produced by the newly sanctioned companies.
“They are taking a break for now while contemplating if there are ways to work around,” the executive added.
China has said it opposes unilateral sanctions.
Sinopec and Zhenhua Oil did not respond to requests for comment.
Gazprom Neft and Surgutneftegaz did not reply to Reuters requests for comment.
Independent refiners have stepped in to take up the slack, supporting prices for Russia’s ESPO blend at a $2.50-$3 per barrel premium to ICE Brent on a delivered basis for March-loading cargoes, said the executive and two other traders.
More recent transactions of April-loading cargoes were likely done at premiums of just above $2 a barrel, traders said. Prices differ for different oil producers and vessels, they added.
Despite layers of Western restrictions aimed at curbing Moscow’s revenue due to its war on Ukraine, Chinese state firms have been key clients of Russian oil, buying roughly half of Russia’s shipments to China, or around 1.3 million bpd, with independent refiners taking the remainder.
Russia is by far China’s largest oil supplier, making up 20% of crude imports at the world’s top importer.
LOWER VOLUMES
PetroChina (601857.SS), opens new tab, a longstanding ESPO buyer from top Russian producer Rosneft (ROSN.MM), opens new tab, however, continued with seaborne purchases in March but at lower volumes, two of the sources said.
CNOOC, which regularly buys and trades Russian oil, has also cut back on March-loading volumes, traders said.
PetroChina and CNOOC did not respond to requests for comment.
In addition to seaborne imports, PetroChina continued lifting 800,000-900,000 bpd of Russian oil, mostly ESPO grade, via pipelines from Siberian fields under a long-term agreement.
Sinopec, Asia’s top crude buyer, has been filling in the gap on Russian imports with cargoes from West Africa, the Middle East and Brazil, traders said.
Source: Reuters (Reporting by Chen Aizhu and Florence Tan; Additional reporting by Reuters reporters in Moscow; Editing by Tony Munroe and Muralikumar Anantharaman)port-and-ship
17 March 2025
Hellenic shipping news
Gibson Tanker Report – Sailing The Sea Of Sanctionsin Weekly Shipbrokers Reports
17/03/2025
Just before the end of his presidency, the Biden administration gave a parting gift to the tanker markets as the Office of Foreign Assets
Source: GIBSON SHIPBROKERS LTDport-and-ship
17 March 2025
Hellenic shipping news
Us Steel, Aluminum Tariffs Shake Global Trade Partnershipsin Commodity News
17/03/2025
A US 25% tariff on all steel and aluminum imports took effect March 12, triggering counter-tariffs from some of the US’ largest trading partners.
US President Donald Trump originally ordered across-the-board aluminum and steel tariffs Feb. 11, citing national security concerns. The order updates existing tariffs on aluminum and steel by implementing a 25% duty rate on all imports with no exceptions. The EU, Canada, and other countries objected to the new tax on their goods.
“President Trump’s latest tariffs are an attack on Canadian workers, families, and businesses. My government will ensure our response has maximum impact in the US and minimal impact here in Canada while supporting the workers impacted,” said Mark Carney, prime minister-designate of Canada, in a social media post.
“My government will keep our tariffs on until the Americans show us respect and make credible, reliable commitments to free and fair trade.”
The tariffs have become the center of escalating trade tensions between the US’ largest trading partners. Canada said March 12 that it would impose 25% tariffs on $29.8 billion of US goods starting March 13. The EU said it would impose retaliatory tariffs on $28.4 billion of US goods in April.
Australia, Japan, and the UK failed to receive exemptions from the tariffs but vowed to continue to lobby with the White House. The top suppliers of steel and aluminum to the US are Canada, Brazil, Mexico, South Korea, and China, data from S&P Global Market Intelligence showed.
Steel in favor
The US steel industry, which has long complained about high import volumes, has strongly supported the move.
“AISI supports President Trump’s actions implementing tariffs on imported steel and eliminating the steel Section 232 exclusion process that has been exploited as a loophole by foreign producers seeking to avoid tariffs,” Kevin Dempsey, president and CEO of the American Iron and Steel Institute, said in a statement. “AISI applauds the president’s actions to restore the integrity of the tariffs on steel and implement a robust and reinvigorated program to address unfair trade practices.”
In 2018, Trump imposed Section 232 tariffs of 25% on steel imports and 10% on aluminum imports, but ultimately granted concessions to several countries. Previously, Canada, Mexico, and Australia had been exempted from aluminum and steel tariffs. Brazil, South Korea, Japan, and the EU had received quotas allowing them to avoid steel duties so long as imports remained below specified levels.
Aluminum relationship complicated
The US aluminum sector supported tariff actions in principle, but it has strongly opposed the inclusion of duties on Canada due to the highly integrated nature of the North American aluminum supply chain. Many US producers are hoping for the return of exemptions on Canadian aluminum.
“The aluminum industry supports tariff-free access for Canadian aluminum in the tariffs implemented today. We appreciate President Trump’s focus and attention on growing and strengthening the US aluminum industry, and there is a lot to like in today’s action,” Charles Johnson, president and CEO of the Aluminum Association, said in a statement.
“At the same time, the industry’s decades-long trading relationship with Canada is a good deal for America. The aluminum we import from Canada today is equivalent to the energy generated by at least four Hoover Dams. And just one Canadian smelter job supports about 13 US aluminum jobs further downstream,” Johnson added.
The Aluminum Association, which represents US aluminum producers, immediately called for exemptions on Canadian and Mexican aluminum imports after Trump issued his initial Feb. 11 executive order on the tariffs. According to the association, the US industry sources about two-thirds of its primary aluminum from Canada, and about 90% of its scrap imports come from either Canada or Mexico.
Canada fights back
Canada, the US’ largest trading partner and largest source of aluminum and steel, has been particularly shocked by Trump’s actions.
Trump ordered additional 25% tariffs on Canadian aluminum and steel March 11 in response to retaliatory tariffs the province of Ontario placed on electricity exports to the US.
While both sides eventually backed down after US Commerce Secretary Howard Lutnick intervened, the combative back-and-forth between the two nations has been ongoing since Trump’s decision to impose tariffs on all Canadian imports. Those tariffs—separate from Trump’s March 11 announcement—briefly went into effect before Trump decided to suspend and delay them until April 2.
“We have a very unjust attack on the Canadian economy,” Stephen Lecce, Ontario’s minister of energy and electrification, said March 11 at CERAWeek by S&P Global.
“The premier of Ontario and the premiers of Canada have stood up with the federal government to signal that we cannot accept this interruption of the free flow of goods that has been very good for both our economies. It’s billions of dollars, literally $0.5 trillion of trade moving nationally every single year,” he added.
Canada exported $15.2 billion worth of aluminum to the US in 2023, according to the Canadian Ministry of Natural Resources. A 25% tariff rate would levy $3.8 billion on that amount.
Source: Reutersport-and-ship
17 March 2025
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17 March 2025
Hellenic shipping news
Turkey'S Tupras Imports First Brazilian Crude Cargo, Data Showsin Freight News
17/03/2025
Turkey’s largest oil refiner Tupras is set to receive a cargo of Itapu crude early next month, its first such purchase from Brazil, according to a source with knowledge of the matter, and ship tracking data.
Tupras last month said it had stopped buying Russian crude after the United States announced new sanctions on Russia’s oil industry on January 10.
The cargo of Itapu crude, around 1 million barrels, was loaded onto the Suezmax tanker Joao Candido on March 12, according to tracking data from Kpler and LSEG.
It is scheduled to arrive at Turkey’s Izmit port, where Tupras operates a 225,800 barrel per day capacity oil refinery, on April 3-4, the data show.
Tupras did not immediately respond to a Reuters request for comment, which arrived late in the Turkish business day on Friday, on the reason for the purchase.
The Kpler shipping data that go back to 2013 show that neither of Tupras’ two refineries, one at Izmit and another at Izmir, has previously received Brazilian crude.
Itapu is a medium sweet crude with an API gravity of 29.3, and a sulphur content of 0.253%, according to data seen by Reuters. Urals is medium sour, meaning it has a similar density to Itapu at around 31.7 API, but is more sulphurous at 1.7%, according to data provided by S&P Global Commodity Insights.
Tupras had become one of the biggest importers of Russian crude since Moscow’s invasion of Ukraine in 2022, receiving around 305,000 bpd of the grade in 2024 according to Kpler.
Itapu is closer in quality to other medium sweet grades that Tupras occasionally buys, such as Nigeria’s Forcados, a Mediterranean crude trader said.
Source: Reutersport-and-ship
17 March 2025
Hellenic shipping news
Cyprus: ‘Challenging’ Year Ahead For Shipping, Says Presidentin International Shipping News
17/03/2025
The year 2025 is expected to be another challenging year for international shipping, which should remain resilient and continue to adapt and grow, President Nikos Christodoulides said on Friday evening.
Addressing the annual dinner of the Cyprus Shipping Chamber in Limassol, Christodoulides assured that his government would continue to support Cyprus’ shipping industry, which has “grown impressively over the past two years”.
“We have a common goal: enhancing the competitiveness of our maritime industry and promoting sustainable economic growth,” he said.
The president said, “2025 is expected to be another challenging year for international shipping. As you are well aware, the pressure on the industry is immense.”
“Yet we know all too well that challenges can be a fertile ground for opportunity to grow and thrive,” he added.
He explained that “in recent years, and especially over the past two years, we have witnessed significant geopolitical developments worldwide.”
“Russia’s invasion of Ukraine, the war in Gaza, the Houthi attacks disrupting cargo transport through the Suez Canal – just to name a few – have impacted international shipping. An industry that, due to its global character and particularities, remains inherently vulnerable to geopolitical and politico-economic developments, highlighting the need for resilience and adaptability,” he said.
He added that “at the same time, the challenges of decarbonising the sector, advancing digitalisation and addressing the shortage of qualified personnel in maritime transport, have added further strain to the shipping industry.”
“In the face of these challenges, international shipping must remain resilient and continue to adapt and grow,” the president said.
Christodoulides assured that his government would “continue to steadfastly support our shipping industry, as well as your efforts towards sustainable growth.”
“Cyprus shipping has grown impressively over the past two years. As a result, in the last 16 months, the Cyprus ship registry has expanded by 18 per cent in terms of gross tonnage, reaching its highest point since the establishment of the Shipping Deputy Ministry in March 2018.
“Moreover, the number of companies registered under the Cyprus Tonnage Tax System has also increased by 15 per cent during the same period. This notable growth has gone hand in hand with the growth in the Cyprus economy over the past two years, as reflected in the successive upgrades by major rating agencies – the result of the Government’s prudent fiscal policy.
“This policy that brings stability in the financial sector and the continuous and determined reforms which we have undertaken. This is the path we will continue to walk with confidence and determination,” the president said.
He added that, “within this context, enhancing the competitiveness of Cyprus shipping remains high in our priorities.”
“We are committed to further strengthening both the framework governing the services provided by the Shipping Deputy Ministry as well as Cyprus’s role in global maritime affairs.
“In this context, and as part of our commitment to the green and digital transition, the digitalisation of services of the Shipping Deputy Ministry is progressing. In fact, we are set to launch the first digital services by the end of May 2025,” he said.
Christodoulides also said that “a new initiative has been launched under the Shipping Deputy Ministry’s flagship projects, focusing on developing policies to further expand and attract services related to Cyprus shipping.”
“This initiative places particular emphasis on services related to technology, research and innovation, and pleasure yachts,” he added.
The president expressed certainty that “the exceptional collaboration and close partnership between the government and the Cyprus Shipping Chamber will continue to flourish, paving the way for further achievements and a sustainable, prosperous future.”
Prior to concluding, he congratulated Alexis Iosifides on his appointment as the new director general of the Cyprus Shipping Chamber.
He also paid “special tribute to my friend” Thomas Kazakos, the newly appointed secretary general of the International Shipping Chamber.
Source: Cyprus Mailport-and-ship
17 March 2025
Hellenic shipping news
Mol, Namura Shipbuilding, Mitsubishi Shipbuilding Acquire Aip For Large Ammonia-Powered Ammonia Carrier- Major Step Toward Enhanced Ammonia Transport Capacityin International Shipping News,Shipping: Emission Possible
17/03/2025
Mitsui O.S.K. Lines, Ltd. announced that a large-size ammonia-powered ammonia carrier, under joint development by MOL, Namura Shipbuilding Co., Ltd. and Mitsubishi Shipbuilding Co., Ltd. since 2021 ,has received Nippon Kaiji Kyokai (ClassNK) approval in principle (AiP (Note 2)) for its ammonia fuel compatible design.
The companies are developing the vessel in anticipation of wide use of ammonia as a zero-carbon fuel and hydrogen carrier, and in response to further demand for ammonia fuel transitions in power plants. The carrier features larger cargo tanks than very large gas carriers (VLGCs) and very large ammonia carriers (VLACs), enabling low-emission transport and higher cargo capacity, while also using ammonia as fuel. In particular, it is a groundbreaking vessel in that it meets the restrictions on entry into major power plants in Japan, while maintaining specifications consistent with current VLGCs in terms of connections to power plants and ammonia supply terminals during loading and discharging.
ClassNK reviewed the basic plans and results of the hazard identification study (HAZID (Note 3)), reflecting in the basic design. This allows for the completion of the detailed design. In HAZID, the safety of ammonia toxicity, which is a major concern, was studied and evaluated as a top priority, and sufficient countermeasures have been implemented in the design.
The MOL Group aims to achieve net zero greenhouse gas (GHG) emissions by 2050, and will continue to work toward the realization of a decarbonized, low-carbon society in line with BLUE ACTION 2035 and MOL Group Environmental Vision 2.2. The group aims to realize a sustainable society as an infrastructure company that supplies clean energy in addition to introducing clean alternative fuels.
Source: Mitsui O.S.K. Linesport-and-ship
17 March 2025
Hellenic shipping news
Raízen Announces Discontinuation Of Bunker Operations At Key Brazilian Portsin Port News
17/03/2025
Raízen, one of Brazil’s largest fuel distributors, has announced it will be discontinuing its bunker operations at the ports of Rio Grande, Salvador and Itaqui OPL, effective in April, according to a company statement sent to traders and seen by Platts, part of S&P Global Commodity Insights. The company, which has been a key player in the Brazilian bunker supply market, confirmed that fuel deliveries at these locations will cease after March 31.
“Raizen is leaving the market, they will operate until March 31,” told another bunker trader operating in the Brazilian market on March 13.
The statement assured its customers that it remains committed to providing the necessary support during this transition. The company emphasized that deliveries of Low Sulphur Marine Gas Oil (LSMGO) will continue in Rio de Janeiro, ensuring a steady supply for marine customers in that region.
“With the new board, they are leaving markets that are not in the core business, mainly the markets where they are losing money; bunker is one of them,” the trader added.
The company did not immediately respond to Platts’ request for comments.
Platts assessed Rio Grande Marine Fuel 0.5%S prices at $525/mt on March 13.
Source: Plattsport-and-ship
17 March 2025
Bunker Port News Worldwide
Turkey’S Tupras Imports First Brazilian Crude Cargo, Data ShowsTurkey’s largest oil refiner Tupras is set to receive a cargo of Itapu crude early next month, its first such purchase from Brazil, according to a source with knowledge of the matter, and ship tracking data.
Tupras last month said it had stopped buying Russian crude after the United States announced new sanctions on Russia’s oil industry on January 10.
The cargo of Itapu crude, around 1 million barrels, was loaded onto the Suezmax tanker Joao Candido on March 12, according to tracking data from Kpler and LSEG.
It is scheduled to arrive at Turkey’s Izmit port, where Tupras operates a 225,800 barrel per day capacity oil refinery, on April 3-4, the data show.
Tupras did not immediately respond to a Reuters request for comment, which arrived late in the Turkish business day on Friday, on the reason for the purchase.
The Kpler shipping data that go back to 2013 show that neither of Tupras’ two refineries, one at Izmit and another at Izmir, has previously received Brazilian crude.
Itapu is a medium sweet crude with an API gravity of 29.3, and a sulphur content of 0.253%, according to data seen by Reuters. Urals is medium sour, meaning it has a similar density to Itapu at around 31.7 API, but is more sulphurous at 1.7%, according to data provided by S&P Global Commodity Insights.
Tupras had become one of the biggest importers of Russian crude since Moscow’s invasion of Ukraine in 2022, receiving around 305,000 bpd of the grade in 2024 according to Kpler.
Itapu is closer in quality to other medium sweet grades that Tupras occasionally buys, such as Nigeria’s Forcados, a Mediterranean crude trader said.
Source: Reutersport-and-ship
17 March 2025Bunker Port News Worldwide
Mol, Namura Shipbuilding, Mitsubishi Shipbuilding Acquire Aip For Large Ammonia-Powered Ammonia Carrier- Major Step TowaMitsui O.S.K. Lines, Ltd. announced that a large-size ammonia-powered ammonia carrier, under joint development by MOL, Namura Shipbuilding Co., Ltd. and Mitsubishi Shipbuilding Co., Ltd. since 2021 ,has received Nippon Kaiji Kyokai (ClassNK) approval in principle (AiP (Note 2)) for its ammonia fuel compatible design.
The companies are developing the vessel in anticipation of wide use of ammonia as a zero-carbon fuel and hydrogen carrier, and in response to further demand for ammonia fuel transitions in power plants. The carrier features larger cargo tanks than very large gas carriers (VLGCs) and very large ammonia carriers (VLACs), enabling low-emission transport and higher cargo capacity, while also using ammonia as fuel. In particular, it is a groundbreaking vessel in that it meets the restrictions on entry into major power plants in Japan, while maintaining specifications consistent with current VLGCs in terms of connections to power plants and ammonia supply terminals during loading and discharging.
ClassNK reviewed the basic plans and results of the hazard identification study (HAZID (Note 3)), reflecting in the basic design. This allows for the completion of the detailed design. In HAZID, the safety of ammonia toxicity, which is a major concern, was studied and evaluated as a top priority, and sufficient countermeasures have been implemented in the design.
The MOL Group aims to achieve net zero greenhouse gas (GHG) emissions by 2050, and will continue to work toward the realization of a decarbonized, low-carbon society in line with BLUE ACTION 2035 and MOL Group Environmental Vision 2.2. The group aims to realize a sustainable society as an infrastructure company that supplies clean energy in addition to introducing clean alternative fuels.
Source: Mitsui O.S.K. Linesport-and-ship
17 March 2025container news
Rising Cyber Threats Call For Greater Investment And Training In ShippingIn 2024, the shipping industry has faced heightened cyber vulnerabilities, driven by increasing digitalization and automation. However, this growing risk is compounded by insufficient cybersecurity investments across the sector.
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16 March 2025Bunker Port News Worldwide
Apm Terminals Lázaro Cárdenas Welcomes First Vessel Of The Gemini CooperationAPM Terminals Lázaro Cárdenas has reached a significant milestone with the arrival of the first vessel operated under the Gemini Cooperation, a partnership between Maersk and Hapag-Lloyd that will redefine connectivity and operational efficiency in global maritime logistics. This milestone reinforces the critical role of the Port of Lázaro Cárdenas in transforming the global supply chain.
The Gemini Cooperation, which began operations in February 2025, represents a new, innovative approach to managing East-West maritime trade routes. The collaboration aims to deliver more efficient and reliable services by reducing the number of port calls, resulting in improved terminal efficiency and reliability.
“For APM Terminals, we are happy to support the Gemini Cooperation, at it marks the beginning of a new era in global maritime trade, improving both connectivity and efficiency across key trade routes. For our terminal in Lázaro Cárdenas, this initiative strengthens Mexico’s strategic role in global commerce and positions the terminal as a key gateway for trade within the USMCA region and across the Americas”, said Keith Svendsen, CEO of APM Terminals.
APM Terminals Lázaro Cárdenas plays a key role in this collaboration by implementing the Simultaneous Transshipment Connection, a pioneering operation designed to transfer containers between two vessels simultaneously, cutting down on waiting times and maximizing operational efficiency.
Beatriz Yera, CEO of APM Terminals Mexico, stated, “The ambition of the Gemini Cooperation is to enhance efficiency and reliability in East-West trade routes. Our terminal in Lázaro Cárdenas will be a vital key port in this initiative, and importantly, we are the only terminal in the Mexican Pacific executing the Simultaneous Transshipment Connection operation. Our significant investments in technology and process automation place us in a unique position to contribute to the success of the Gemini Cooperation. Today, we reaffirm our commitment to strengthening our customers’ supply chains with innovation and technology while helping position Mexico as a leader in global logistics.”
The Gemini Cooperation consists of 29 liner services, complemented by a vast network of agile interregional services. These routes cover critical markets such as Asia-US West Coast, Asia-US East Coast, Asia-Middle East, Asia-Mediterranean, and Asia-Northern Europe. This approach will not only enhance connectivity but also reduce the number of port calls per rotation, enabling improved transit times and increasing reliability for the market.
With the arrival of this first vessel and continuous infrastructure enhancements, APM Terminals Lázaro Cárdenas reaffirms its commitment to delivering agile, reliable, and efficient services, backed by significant investments in technology and operational improvements, ultimately benefiting our customers.
Source: APM Terminalsport-and-ship
16 March 2025maritime gateway
Mormugao Port Adds New Harbour CranesThe sorely felt need for mobile harbour cranes at the Mormugao Port was finally met with the arrival of two Liebherr mobile harbour cranes, each with a lifting capacity of 125 tonnes, from Germany. Along with the arrival of the harbour cranes aboard the MV Charlie, the Mormugao Port Authority (MPA) initiated discussions with two container feeder operators for shipping links to either Mundra port in Gujarat or Vizhinjam International Seaport in Kerala. Both these ports are operated by Adani Ports.
According to MPA officials, it will take 15-20 days for the two mobile cranes to be set up and operationalised, and another three months for the feeder service to commence from Mormugao. The cranes will be operated at berths 10 and 11, which MPA handed over to Delta Ports Mormugao Terminal Pvt Ltd as part of a 30-year lease.
Mormugao Port used to handle containerised cargo earlier and even hit around 38,000 TEUs per annum. However, the port’s harbour crane broke down in 2020, and the feeder service for the container cargo also stopped operations as there was no harbour crane to load container cargo. The ministry for ports, shipping and waterways (MoS) asked MPA to procure a 100-tonne mobile crane as part of a tender to redevelop berths 10 and 11 under the public-private partnership (PPP) model.port-and-ship
15 March 2025port technology international
Port Of Rotterdam Sees €320 Million In Gross InvestmentsThe major investments at the Port of Rotterdam reportedly included expanding container terminals in Prinses Amaliahaven, building the CO2 transport and storage project Porthos, widening the Yangtzekanaal, and developing the Portlantis port experience centre.
READ: Port of Rotterdam witnesses marginal drop in cargo throughput
The port stressed its commitment to construct a future-proof port in conjunction with its environment, while connecting the city with the port.
In the past year, new partnerships have been formed with local entities, including the Rotterdam Philharmonic Orchestra. Furthermore, a pilot programme offering port consultation hours for residents has been introduced at various neighbourhood hubs.
Container volumes at the port in 2024 increased for the first time in three years, with consumer goods and food products as the main growth drivers.port-and-ship
15 March 2025marine insight
North Korean Ship Smuggling Coal Sinks After Collision With Chinese Vessel, Nearly 20 DeadA North Korea-flagged vessel, suspected of smuggling coal in violation of United Nations sanctions, sank in the Yellow Sea last month after colliding with a Chinese ship, per sources.
The incident, which occurred in February near a southeastern Chinese port, is believed to have left between 15 and 20 North Korean crew members dead.
Despite rescue efforts by Chinese authorities, only a few crew members survived, while the Chinese vessel sustained minor damage. Neither North Korea nor China has officially acknowledged the accident, likely due to the illegal nature of the ship’s activities.
The North Korean vessel has switched off its Automatic identification System (AIS) while sailing through the Yellow Sea, a common practice among North Korean ships trying to evade international tracking.
The area where the collision occurred is known as a hotspot for smuggling North Korean coal, which is banned under United Nations Security Council (UNSC) Resolution 2371.
The resolution, passed in 2017, prohibits North Korea from exporting coal, iron ore, seafood, and other resources in response to its ballistic missile program.
A source familiar with the incident said that poor visibility due to heavy fog may have contributed to the collision. The vessel was overloaded with coal, causing both the cargo and the ship to sink together.
Although Chinese authorities conducted a rescue operation, there has been no official statement from Beijing regarding the incident.
A source suggested that China may not want to disclose the accident, as it could indicate its direct involvement in violating UNSC sanctions. South Korea’s National Intelligence Service stated it is closely monitoring the situation.
Smuggling is a major source of income for North Korea, with reports revealing that the country earned approximately $2.15 billion from coal shipments between 2017 and 2023.
The Seoul-based Institute for National Security Strategy has reported that sanctioned refined oil sales have also generated around $1.8 billion for Pyogyang.
Experts say that despite China’s customs enforcement, smuggling operations remain difficult to track due to their vast networks.
Hong Jae-hwan, a research fellow at the Korea Institute for National Unification, said that North Korean coal continues to be in high demand in China due to its quality and low price.
Per reports, North Korea collaborates with Chinese businesses to forge shipping documents and manipulate tracking data to conceal coal shipments.
A similar incident occurred near China’s Lianyungang port, but unlike the recent accident, all crew members were rescued, and China’s Transportation Ministry publicly acknowledged the event.
According to reports another North Korean transport vessel may have sunk in June 2024, resulting in the deaths of up to 90 North Korean troops. However, details on that incident remain unclear.
References: koreatimes, nikkei asia
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15 March 2025marine insight
U.S Navy Ship Completes Maintenance Work At A South Korean Shipyard For The First TimeIn a major step towards deepening U.S. and South Korean ties, a U.S. Navy ship for the first time underwent maintenance, repair and overhaul (MRO) in the Hanwha Ocean’s Geoje Shipyard.
The Lewis and Clark dry cargo class ship, with a displacement of 40,000 tonnes, left the facility on Wednesday.
The overhaul and repairs of USNS Wally Schirra marks the first time a South Korean Shipyard has undertaken a major refit of a U.S. Navy ship.
South Korea expects more such opportunities under Trump’s plans to strengthen and revitalise the U.S. Navy amidst growing Chinese domination.
The ship spent six months at the shipyard where work was done on her machinery and hull, including inspections of its equipment, replacements and upgrades of a few onboard systems.
The facility also suggested a few measures for improving the ship’s operations and efficiency and obtained a revised contract from the United States Navy. Per MSC, issues like hull corrosion and replacing the rudder system were addressed. The ship left South Korea on March 12, 2025.
Hanwha took care of the hull damage, rudder, steering gear and propeller, said Cmdr Patrick J Moore, the commanding officer, MSC office in Korea. He also added that Hanwha engineers reverse engineered the damaged rudder and replaced the unit, saving time and resources in getting the ship back to the waters, an evidence of their robust supply chains, advanced technologies and skilled personnel.
This maintenance work was performed as part of the U.S. Navy’s MRO Program. Hanwha signed a contract with the navy in 2024 and became the second shipyard in South Korea to be authorised to bid for contracts. HD Hyundai was also authorized in 2024 and will start bidding for contracts this year.
Small repairs are regularly done in Korea, but this marks the first time much extensive work has been done in the country on a U.S. Navy vessel.
Additionally, Hanwha Ocean has a second project, the overhauling of refueling ship USNS Yukon, that reached the yard in November. The shipyard mentioned that it plans to target at least 5 to 6 contracts this year and hopes to expand its operations.
References: USNI News, Yahoo news
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15 March 2025marine insight
Norwegian Cruise Line Takes Delivery Of Its First $850 Million Prima Plus-Class Cruise ShipNorwegian Cruise Line has taken the delivery of its newest and biggest ship of its fleet, the Norwegian Aqua, which is gearing up for its first voyage scheduled for April 26, 2025, a 7-night Caribbean Cruise from Canaveral Port.
The ceremony was organised in Venice at Fincantieri’s Marghera Shipyard, where over 4000 skilled professionals worked tirelessly to construct the behemoth, estimated to cost $850 million to build.
This is the first in the next-generation Prima-class ship, with a 156,300 gross tonnage and measuring 322 m lengthwise. It is 10% larger than the first two Prima class vessels, the Norwegian Prima and Norwegian Viva.
Guests will be thrilled to discover the Slideocoaster, the first hybrid roller coaster with a water slide, an interactive digital sports complex, the Glow Court and the Ocean Boulevard, a 360-degree outdoor promenade.
President of NCL David J Herrera mentioned that it is more than just a vessel and is a commitment to the guests that they will continue to push their boundaries to deliver more at sea.
The vessel also has the Sukhothai, their first Thai specialty restaurant, to cater to the sensitive taste buds of its guests.
The ship is designed to offer a memorable and fun experience to a family while cruising to the Caribbean, the company’s private island in the Bahamas, Bermuda and Great Stirrup Cay, where it promises to invest in great guest experiences.
Its sister ship, Norwegian Luna, was floated out recently and would be taken to the floating dock, earlier occupied by the Norwegian Aqua. The ship will be launched in 2026.
The Fincantieri shipyard is presently working on 4 new cruise vessels for Norwegian that will be one of the biggest at sea, with the first likely to be delivered in 2030.
References: AOL, The Independent
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15 March 2025Bunker Port News Worldwide
Fitch Affirms Adani Ports At ‘Bbb-‘; Off Rating Watch Negative ; Outlook NegativeFitch Ratings has affirmed India-based port operator Adani Ports and Special Economic Zone Limited’s (APSEZ) Long-Term Foreign-Currency Issuer Default Rating (IDR) at ‘BBB-‘ and removed it from Rating Watch Negative (RWN). The Outlook is Negative. A full list of rating actions is at the end of this commentary.
RATING RATIONALE
The rating affirmation follows the demonstration of adequate funding access by the Adani group following the US indictment of certain board members of another group entity, Adani Green Energy Limited (AGEL), on 20 November 2024.
We believe the risk associated with the group’s liquidity and funding requirements has moderated. However, the Negative Outlook reflects our view that the proceedings and outcome of the US investigations could reveal further weaknesses in the group’s corporate governance practices, which may lead to negative rating action in the near to medium term. Fitch will monitor the investigations for any evidence of weakness in the entities’ governance practices and internal controls, and the impact on APSEZ’s financial flexibility.
The rating continues to reflect APSEZ’s strong business and financial profile, underpinned by a robust portfolio of seaports and adequate liquidity position. Its cash balance of INR77 billion as of December 2024 and strong operating cash flow should cover debt maturities of INR66 billion during the financial year ending March 2026 (FY26) and fund its capex. The company also benefits from flexibility in the pace of execution of its expansion projects.
Fitch assesses the financial profile to be stronger than is commensurate with its ‘BBB-‘ rating. Fitch’s governance assessment, as well as India’s (BBB-/Stable) Country Ceiling of ‘BBB-‘, constrains APSEZ’s rating at ‘BBB-‘. APSEZ benefits from geographically diversified port locations, advanced intermodal connectivity transportation infrastructure and best-in-class operational efficiency. It has high customer retention for about half of its cargo, owing to comprehensive and advanced infrastructure to handle a variety of cargoes.
KEY RATING DRIVERS
Best-in-Class Port Operator – Revenue Risk (Volume): Stronger
APSEZ is India’s largest commercial port operator, handling a quarter of the country’s seaborne cargo through its 14 operational ports and terminals in India. Most are primary ports of call in their regions. Its flagship Mundra Port is the gateway to north-western India. Traffic is mainly origin and destination, with limited transshipment cargo. APSEZ’s advanced transport infrastructure, operational efficiency and integrated logistics solutions that transport cargo from its ports to inland depots via railways have led to market share gains and faster organic throughput growth than its peers and India’s economic growth.
Cargo that is difficult to switch to other ports makes up about half of total throughput. APSEZ continues to diversify its throughput from the west coast, with its east-coast terminals accounting for more than 40% of total throughput. The company’s expanded logistics business covers all of India, with multimodal logistics for warehousing, rail transportation and distribution.
Flexibility in Modifying Tariffs – Revenue Risk (Price): Midrange
APSEZ’s portfolio comprises mainly non-major ports. The private ports have the freedom to fix their own tariffs, which are generally higher than at other Indian ports, but this is justified by APSEZ’s better operational efficiency and connection with the hinterland, as it lowers shippers’ overall logistics costs, according to management.
The company’s take-or-pay contracts accounted for about 12% of port revenue in the financial year ended March 2024 (FY24), with a capacity-weighted remaining contract term of 16 years. Take-or-pay contracts insulate revenue from throughput volatility. The assessment is constrained to ‘Midrange’ due to regulated tariffs at certain ports, although their contribution to APSEZ’s EBITDA is minimal.
Internally Funded Capex – Infrastructure Development and Renewal: Stronger
APSEZ’s medium-term capex plan is well developed, focusing primarily on expanding capacity at key ports to accommodate demand growth, as most major greenfield projects are nearing completion. Its capex plans also involves upgrading ports and enhancing logistics capabilities, including warehousing, bulk rakes and trucking. It has budgeted annual capex of about INR110 billion-115 billion over the medium term. APSEZ has a strong record of managing its port investments, which are mostly discretionary and can be postponed without affecting operations significantly.
Fixed-Rate Bullet Bonds Dominate – Debt Structure: Midrange
APSEZ’s consolidated debt comprises mainly US dollar and Indian rupee bullet bonds. We expect its business strengths, established capital market access and relationships with banks to mitigate refinancing risk. APSEZ also has limited exposure to floating interest rates since the majority of its debt is made up of fixed-rate bonds and notes. The bonds do not benefit from restrictive financial covenants or reserve accounts and it relies on natural hedging to manage foreign-exchange risk. Nearly one-third of its revenue is in US dollars and should be sufficient to service its US dollar debt.
Financial Profile
Fitch’s base case assumes annual cargo volume growth of about 10%-15% and 2%-3% annual tariff growth over the next few years. We forecast an EBITDA margin of about 60% over the period, annual capex of INR115 billion-120 billion and annual cash outflow from acquisitions at the same level as FY24. We have also assumed a dividend payout ratio of 20%-25% per annum. Our base-case total debt/operating EBITDA remains below 2.5x from FY26 to FY28.
Our rating case assumes a haircut from the base case at about 2%-5% in volume and about 1%-2% in tariffs, an additional 2pp-3pp stress on the EBITDA margin, a 20% stress on capex and 10% additional stress on acquisition assumptions. We have assumed a higher dividend payout ratio of 25% per annum. The rating-case total debt/operating EBITDA remains below 3.0x from FY26 to FY28.
PEER GROUP
We view APSEZ as most comparable to JSW Infrastructure Limited (JSWIL, BB+/Positive). Both JSWIL and APSEZ have diverse portfolios and debt profiles with limited protective features. However, APSEZ benefits from a more diverse cargo and counterparty mix, larger scale of operations, and larger portion of cargo throughput due to its longer-term cargo contracts compared with JSWIL. APSEZ’s rating is, however, constrained by its ESG assessment and India’s Country Ceiling. We therefore assess APSEZ only one notch higher than JSWIL despite its much stronger business profile.
Port of Melbourne (issuing entity Lonsdale Finance Pty Ltd: BBB/Stable) is the primary port of call in the State of Victoria and serves Australia’s broader market with limited competition. Its rating benefits from a diversified landlord port business model, long concession life, and low infrastructure development and renewal risk, although its operational scale is much smaller than that of APSEZ. Despite an average net debt/EBITDA of 7.9x against APSEZ’s 3.0x under Fitch’s rating case, Port of Melbourne is rated a notch higher than APSEZ as its overall stronger qualitative attributes support higher leverage, while APSEZ is constrained by its ESG assessment and India’s Country Ceiling.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
– Impairment of financial flexibility, which would be evident from increased funding costs or restricted funding access;
– Evidence of further weaknesses in group entities’ governance practices and internal controls, such as material adverse development from the US investigation;
– Prolonged deterioration in rating-case debt/EBITDA to above 6.0x;
– Lowering of India’s Country Ceiling to ‘BB+’.
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
The rating could be affirmed with a Stable Outlook if risks of any material negative implications from the US investigations do not materialise, while funding access remains intact.
CREDIT UPDATE
APSEZ continued to handle about a quarter of India’s total cargo volume in 9MFY25. Cargo throughput increased by 7% yoy, while revenue rose by 14%, contributed largely by organic throughput growth in Mundra as well as consolidation of results from Astro Offshore, a leading offshore support vessel owner, and Tanzania’s concession starting from 2HFY25.
APSEZ completed the acquisition of its majority stake in Gopalpur Port in FY25 and an 80% interest in Astro Offshore. It has also signed a 30-year concession agreement to operate and manage Container Terminal 2 at the Dar es Salaam port in Tanzania. In addition, India’s first dedicated transshipment hub, Vizhinjam Port, also commenced operation in December 2024.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
APSEZ’s rating is capped by India’s country ceiling
ESG Considerations
APSEZ has an ESG Relevance Score of ‘4’ for Governance Structure due to the complexity of its group structure at the shareholder level, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors.
APSEZ has an ESG Relevance Score of ‘4’ for Group Structure due to the concentration of ownership with a large majority stake held by Adani Group, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors.
The highest level of ESG credit relevance is a score of ‘3’, unless otherwise disclosed in this section. A score of ‘3’ means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch’s ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision.
Source: Fitch Ratingsport-and-ship
15 March 2025Bunker Port News Worldwide
Shipping And Alternative Fuels Producers Await Imo Regulations On Ghg Emissions FrameworkDuring 2025, the International Maritime Organisation (IMO) will consider adopting new “mid-term measures” for managing greenhouse gas (GHG) emissions. This will include proposed new shipping fuel standards on maximum permitted carbon emissions intensity from ships, and a market-based mechanism for GHG pricing and enforcement. If agreed, they would be adopted as amendments to Annex VI of the MARPOL Convention.
IMO’s global role for international shipping
The IMO, a United Nations specialised agency, has responsibility for the safety and security of international shipping, and the prevention of marine and atmospheric pollution by ships. Its work includes international law reform initiatives, such making regulations covering liability and compensation for damage, such as pollution, caused by ships.
The IMO’s development and reform agenda responds to the UN’s Sustainable Development Goals. Building on its early work establishing the first ever comprehensive antipollution convention, the 1973 International Convention for the Prevention of Pollution from Ships (MARPOL Convention), these regulations now include added requirements addressing pollution from chemicals, other harmful substances, garbage, sewage and – under an Annex VI adopted in 1997 – air pollution and emissions from ships.
Regulation of shipping emissions and efficiency
The first mandatory international measures to improve energy efficiency for ships was issued on 15 July 2011. These introduced controls including the International Air Pollution Prevention Certificate and the International Energy Efficiency Certificate regimes. Further progress was made through the 2018 Initial IMO GHG Strategy and the 2023 Strategy on Reduction of GHG Emissions from Ships.
The IMO’s most recent set of “short term” technical and operational measures, the Energy Efficiency Existing Ship Index (EEXI) and the Carbon Intensity Indicator (CII), have been in force since 1 January 2023.
EEXI framework
Existing ships of 400 GT and above must calculate their attained Energy Efficiency Existing Ship Index (EEXI), which reflects the “technical” or “design” efficiency of the ship. (The IMO will be reviewing the effectiveness of the EEXI requirements during 2025.)
Ships then have to reach a “required EEXI”, equivalent to the Required Energy Efficiency Design Index levels for new vessels for 2022 — a technical efficiency measure for ship design, based on a minimum energy efficiency level per capacity mile (eg. tonne mile) for different ship types and sizes.
The EEXI framework is technology (including fuel-type) neutral: the shipowner or charterer can choose the most appropriate means to achieve the goals set by IMO regulations.
CII Rating
This reflects the operational energy efficiency of ships, building on baselines set by previous fuel oil consumption regimes. It is mandatory for ships of 5,000 gross tonnage and above.
Attained annual operational CII must be documented and verified against the required annual operational CII for a ship. The annual carbon intensity reduction factor is equivalent to business-as-usual until entry into force, then 2% from 2023 to 2026, and finally to be further strengthened for the period 2027 to 2030.
The ship’s operational carbon intensity rating must be states on a performance level scale of A (major superior), B (minor superior), C (moderate), D (minor inferior) or E (inferior). A ship rated D for 3 consecutive years or rated as E must develop a “Plan of corrective actions”.
Fuel type and efficiency is a material component of the CII rating.
2023 GHG Strategy on Reduction of GHG Emissions from Ships
The 2023 IMO GHG Strategy sets ambitious targets to reduce GHG emissions in international shipping, emphasising technological innovation and alternative fuels.
Key goals include:
Carbon intensity reduction – Improving energy efficiency for new ships and reduce CO₂ emissions per transport work by at least 40% by 2030, compared to 2008 levels.
Adoption of Low / Zero-Emission Technologies – By 2030, at least 5% (striving for 10%) of shipping energy use should come from zero or near-zero GHG emission sources.
Net-Zero Emissions by 2050 – Emissions should peak as soon as practicable, and reach net-zero by 2050.
Indicative interim checkpoints – Cutting total annual GHG emissions by 20-30% by 2030, and by 70-80% by 2040, compared to 2008 levels.
In the medium term, the IMO has indicated that “a basket of candidate measure(s), delivering on the reduction targets, should be developed and finalised, comprised of both:
a technical element, namely a goal-based marine fuel standard regulating the phased reduction of the marine fuel’s GHG intensity; and
an economic element, on the basis of a maritime GHG emissions pricing mechanism.”
Because the IMO is taking a regulatory approach which is technology and fuel-type agnostic, and focusses instead on emissions intensity, it is not setting specific targets for the use of particular fuel types. However, it can be reasonably anticipated that, over time, the approach will be effective in moving shipping fleets from using emissions intense fuel types such as heavy fuel oil, very low sulphur fuel oil and marine diesel to fuels that have a higher energy profile and lower emissions intensity, such as LNG, methanol, ammonia and hydrogen.
Many shipping companies, particularly those with a European operations base, have already started down a comparable path of GHG emissions reductions as a result of the EU’s Monitoring, Reporting and Verification Maritime Regulation and the scheduled progressive coverage of the European Emissions Trading Scheme to cargo and passenger ships.
What is the IMO’s timetable and substantive focus?
The IMO 2023 GHG Strategy includes a timeline for adoption of these mid-term measures:
Northern Spring 2025: approval of mid-term measures;
Northern Autumn 2025: adoption of mid-term measures at an extraordinary session of the Marine Environment Protection Committee; and
2027 (16 months after adoption): entry into force of mid-term measures.
The IMO initially released a preliminary “illustration” of a possible draft outline of an “IMO net-zero framework”, listing regulations under the International Convention for the Prevention of Pollution from Ships (MARPOL) to adopt or amend to allow for a new global fuel standard and a new global pricing mechanism for maritime GHG emissions.
The illustration identifies the following possible amendments to MARPOL Annex VI in a new Chapter 5 entitled “Regulations on the IMO net-zero framework”:
New Chapter 5.1: Goal-based marine fuel standard regulating the phased reduction of the marine fuel’s GHG intensity — with specific new regulations covering its application, goals, functional requirements, attained GHG fuel intensity (GFI), target / required GFI; GFI data collection and reporting; alternative compliance approaches; and a central GFI Registry.
New Chapter 5.2 – Economic mechanism(s) to incentivize the transition to net-zero – with new regulations for application, calculation of economic contribution by ships, collection of economic contribution by ships, flexible compliance mechanism(s), central management / oversight of collected revenue, and distribution of revenue.
At the MEPC 82 meeting, possible draft amendments to MARPOL Annex VI on the net-zero framework (MEPC 82/WP.9, annex 1) were presented as “a work in progress”, and this document continue to be evaluated by the IMO Secretariat, expert working groups and member States in advance of the further deliberations schedule for 2025.
However, some notable aspects of the working draft include:
Well-to-wake scope – The regulations will be based on reported, verified and determined “well-to-wake” GHG emissions produced by the fuel used on board the ship.
Scaled reduction factors – The regulations will set out prescribed reduced factors with dates by which the annual GFI of a ship must be reduced with reference to the GFI reference value, with “base” and “strive” targets.
Emissions pooling – An annual GFI over-compliant ships are to be permitted to pool their surplus compliance units with excess emissions from under-compliant ships, to achieve an overall pool compliance balance of zero.
Financial contributions to IMO Net Zero Fund – A new Fund will be established and ships will be required to make an annual GHG fuel contribution, based on the amount of its GHG emissions multiplied with a contribution rate per tonne of CO2eq as determined by the MPEC, on a well-to-wake basis to be defined in the guidelines to be developed by the IMO.
Statement of Compliance – Will be used as the primary document in which annual GHG fuel intensity and the corresponding GHG fuel contribution to the fund is evaluated.
GFI Registry – A central GFI Registry administered by the IMO will be the record keeper and administrator for both individual and pool data.
Enforcement alternatives – May include either or both of requirements to bring Statements of Compliance into order and / or the imposition of additional charges or the detention of ships by a Port State until compliance is demonstrated.
What does this mean for Australia?
Australia is a signatory to the MARPOL Convention, and progressively implements its requirements into Australian law through legislation and regulations in order to comply with its international treaty commitments.
Most recently, Australia implemented the IMO’s short-term measures for EEXI and CCI under Marine Order 97 (Marine pollution prevention – air pollution) 2022 which came into effect on 1 January 2023. The Order was made by the CEO of the Australian Maritime Safety Authority under subsection 342(a) of the Navigation Act 2012 and subsection 34(1) of the Protection of the Sea (Prevention of Pollution from Ships) Act 1983. A similar mechanism would be used if the medium term measures fall within the scope of AMSA’s regulation-making powers under those laws.
Given the significance of shipping for Australia’s trade and prosperity, Australia is an active member of the IMO and is likely to work effectively through its negotiation mechanisms to ensure any new regulations are capable of swift adoption into Australian law.
Any regulatory developments focused on reducing GHG emissions from shipping would increase global demand for low emissions fuels such as ammonia, methanol and hydrogen. Passage and implementation of these IMO regulations would also therefore bolster the emerging offtake markets for these low-emission fuels, with flow-on benefits for the development of commercial clean and renewable fuels projects in countries, like Australia, with the capacity to produce those fuels at scale using available renewable energy sources.
Source: Clayton Utz – Peter Holcombe Henley and Sarah Hannounport-and-ship
15 March 2025