Ebola crisis in West Africa could boost clean freight rates: sources

The Ebola crisis in West Africa could push clean tanker freight rates higher for vessels heading to the region from the UK Continent, and was forcing shipowners to insert clauses into charter parties to avoid the risk of their vessel being quarantined, shipping sources SAID Friday.

Three shipbrokers said that a number of shipowners carrying clean products were now refusing to take the risk of going to West Africa, which could in turn push rates higher.

Documents from shipowners seen by Platts also show clauses inserted into charter parties by shipowners carrying clean products stipulating that charterers will have to nominate alternative safe discharge ports and pay more for further travel should there be any risk of their vessel being quarantined or detained.

“Some owners do not want to take the risk of going to West Africa because of the Ebola crisis, and that will tighten up tonnage. At this stage it is not affecting rates, but with less vessels around they could well rise soon,” said one broker.

On Thursday rates on Medium Range clean tankers, basis 37,000 mt, going UKC-West Africa were assessed at Worldscale 110. One broker said this rate could rise to around w115-120 soon if fears over the disease spread among shipowners.

A further clause in a charter party stated that the master of the vessel would not be required to discharge or load into any port where the cargo or crew would be exposed to disease.

Concerns over Ebola were also evident among dry bulk brokers. One broker said some Supramax owners were no longer willing to take vessels to West Africa, and that vessels operating in the region could start to receive a premium if more owners pulled out.

On the dirty side, shipping sources said there would be limited impact from the outbreak, particularly for the VLCCs. The VLCCs were said to be safe because they did not come into ports to load, instead doing so at offshore loading terminals.

“The VLCCs are loaded about 60 nautical miles off the coast of West Africa so the Ebola outbreak should not have any impact on them,” said a VLCC broker.
Source: Platts