Som vanligt har jeg givet mit bud på kursraketter i det kommende år. Senest i december 2019 i Dansk Aktionærforenings medlemsblad. Mit bud blev som forrige år LPG-rederierne Avance Gas Holding og BW-LPG. De steg i 2019 henholdvis 350% og 211% i kurs.
2020 har har startet formiddabelt.

På de første to børsdage i januar har Avance Gas Holding steget 15% og BW-LPG 12,39%.

Disclaimer: Jeg har aktier i begge selskaber.

It's hard to deploy trade barriers against highly fungible commodities; they simply reflow like a brook around a stone. Consider propane. China needs a lot of it, both for heating and for its propane dehydrogenation (PDH) plants as a feedstock for propylene, which is used to manufacture plastics.

China slapped a 25% retaliatory tariff on U.S. liquefied petroleum gas (LPG), including propane, in mid-2018. You might think U.S LPG exports would have suffered. They haven't - they're growing rapidly.

The large majority of the world's LPG is exported from either the U.S. or the Middle East. All the Chinese tariffs have done is redirect the flows.

Most of China's LPG now comes from the Middle East. U.S. cargoes go primarily to Japan and Korea via the Panama Canal - and those volumes are increasing because China's LPG buys in the Middle East leave less supply from that source for Japan and Korea. If Chinese tariffs were curbing U.S. exports, Panama Canal transits would decrease, but LPG volumes transiting the waterway rose 8% in the fiscal year that ended Sept. 30.

The long-haul LPG routes are served by vessels called very large gas carriers (VLGCs), which have a capacity of 84,000 cubic meters each. The largest U.S.-listed owner of VLGCs - with a fleet of 21 owned ships plus one chartered-in - is Dorian LPG (NYSE: LPG). On Oct. 31, Dorian reported net income of $40.7 million for the second quarter of its fiscal year compared with a loss of $8.2 million in the same period last year. Adjusted earnings in the most recent period were $0.75 per share, well above the consensus forecast of $0.59.

VLGC spot rates are currently averaging the equivalent of around $60,000 per day, higher than they usually are at this time of year. The winter months typically herald lower VLGC spot rates. Buyers of LPG generally bring in cargoes for the winter ahead of time, while higher winter propane commodity pricing in Asia makes it more attractive to import naphtha as an alternate feedstock for propylene production.

During the conference call with analysts on Oct. 31, Dorian CEO John Hadjipateras highlighted the unusually strong spot rates for LPG (which are measured in dollars per ton, not dollars per day).

"On this date last year, the Baltic rate [for LPG spot shipping] was $41 a ton and the year before it was $30," said Hadjipateras. "Today, the Baltic is above $70. The market appears to have reached a degree of stability, having traded above $50 a ton since April of this year. And just this quarter, the Baltic struck its highest level since 2015, at $81 a couple of weeks ago."

Dorian President John Lycouris highlighted the broader market positives. "Seaborne LPG has grown 15% year to date over 2018, while U.S. export volumes in recent months have for the first time ever taken the global supply lead over Middle East exports. This might be a direct result of the attacks last month in Saudi Arabia, which affected lifting volumes in September and October."

Dorian President John Lycouris highlighted the broader market positives. "Seaborne LPG has grown 15% year to date over 2018, while U.S. export volumes in recent months have for the first time ever taken the global supply lead over Middle East exports. This might be a direct result of the attacks last month in Saudi Arabia, which affected lifting volumes in September and October."

He continued, "U.S. LPG supply has grown by 4.8 million tons year-over-year and the rest of the world supply has kept pace, growing 4.4 million tons year-over-year."

Lycouris added, "During the third quarter, we saw 187 VLGC liftings out of the U.S. - about six monthly cargoes on average more than last year - and we expect an increased number of liftings in the fourth quarter and next year on account of expanding U.S. export capacity."

On the demand front, he pointed to two new PDH units recently opened in China and facilities in South Korea that have operations with increased propane feedstock intake capacity.
Source: FreightWaves, Greg Miller

Greg Miller Archives

FreightWaves (www.freightwaves.com)

STOLT-NIELSEN GAS LTD, a company controlled by STOLT-NIELSEN LIMITED, has sold a total of 2,252,800 shares of AVANCE GAS HOLDING in market trades. As a result of these trades, STOLT-NIELSEN GAS LTD has today, October 17, 2019, passed below the 5% notification threshold. The holding following this sale is 3,225,999 shares, corresponding to 4.99% of the shares in AVANCE GAS HOLDING.

We have raised our target prices to NOK75 (NOK50) for BW LPG, NOK52 (NOK31) for Avance Gas, and USD16.3 (USD9.8) for Dorian LPG. We have applied a 20% discount to our 1-year forward NAVs, so if stocks were to trade to 1.0x our 1-year forward NAV there could be further upside potential.

Cleaves:

Avance: 81 NOK. (fra 67)

BW-LPG: 108 NOK (fra 89)

https://twitter.com/JHannisdahl

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"The most overlooked and underfollowed segment that I cover could be a legitimate "dark horse" candidate for best-performing segment through 2020."

The most overlooked and underfollowed segment that I cover could be a legitimate "dark horse" candidate for best-performing segment through 2020.

In a recent Value Investor's Edge exclusive report, I detailed how the LPG segment was able to shake off one of the most negative trade flow shifts and demand-side developments in recent times.

Strong organic global growth is underpinning the bullish outlook for this segment in a big way, to the point that LPG spot rates continued to climb in the face of this massive headwind.

The negative story, of course, was the US-China trade war.

As China shunned US LPG, substitutes had to be found, straining existing alternate suppliers, and volume growth inevitably suffered as they struggled to replace existing US cargoes. Looking at VLGC cargoes illustrated this point.

https://seekingalpha.com/article/4295843-shippings-notorious-problem-becoming-biggest-blessing

D. 10 oktober 2019

UPPDATERING

Kursuppgång efter betydande kassaflöde på en stark LPG-marknad

Fundamenta i LPG-marknaden fortsätter att utvecklas ungefär i linje med våra förväntningar. Vi har haft en positiv vy sedan mars 2018, som fortfarande drivs av överlägsenheten i USA:s kolväteproduktion. Även om andelen ökar med 110% hittills i år, handlar vi fortfarande under vårt prognostiserade värde på 68 MUSD för en femårig VLGC. Vi prognostiserar fraktrater på mer än 40 000 USD/dag för de kommande fyra kvartalen och förväntar oss att den starka kassagenereringen kommer att stödja aktien. Vi upprepar Köp och riktkursen på 74 NOK.
Investment case

LPG-sjöfarten fortsätter att vara ett renodlat spel på USA, med dess överlägsenhet inom kolväteproduktion. De långsiktiga utsikterna för amerikansk LPG-produktion fortsätter att se bra ut. Därför förväntar vi oss att transportbehovet kommer att växa snabbare än utbudet, vilket resulterar i fraktrater på mer än 40 000 USD/dag under 2020-2021p.
Vår värdering förutsätter P/NAV på 0,8x

Den implicita värderingen i dagens aktiekurs är 57 MUSD för en femårig VLGC. Detta är under det 15-åriga genomsnittet på 69 MUSD och konsensus på 68 MUSD. Vårt NAV-värde per aktie uppgår till 94 NOK, vilket fortutsätter en värdering på 68 MUSD för en fem år gammal VLGC.
Katalysatorer och risker

De nuvarande fraktraterna innebär en fri kassaflödesavkastning på 60% för BW LPG. För varje månad som dessa fraktrater kan upprätthållas är kassagenereringen tillräckligt betydande för att behålla den positiva aktieutvecklingen. Vi upprepar Köp och riktkursen till 74 NOK.

08:44
Oslo (TDN Direkt): Det amerikanske energidepartementets statistikkfløy, EIA, oppjusterer anslagene for amerikansk naturgassproduksjon for 2019 og 2020.

Det fremgår av EIAs seneste Short Term Energy Outlook-rapport 2019, publisert tirsdag kveld, sammenlignet med rapporten måneden før.

EIA venter nå en tørr naturgassproduksjon på 91,63 milliarder kubikkfot pr dag i 2019, mot tidligere anslag på 91,39 milliarder.

For 2020 ventes det nå en naturgassproduksjon på 93,50 milliarder kubikkfot, mot 93,19 milliarder i forrige rapport.

I 2019 venter EIA fortsatt en propanproduksjon på 1,59 millioner fat oljeekvivalenter pr dag i snitt, fra 1,58 forrige rapport

I 2020 ventes det nå en propanproduksjon på 1,70 millioner fat pr dag, mot tidligere anslag på 1,68 millioner fat.

Butanproduksjonen i 2019 anslås fortsatt til 0,85 millioner fat pr dag, mens butanproduksjonen i 2020 anslås til 0,90 millioner fat pr dag, mot tidligere 0,89 millioner fat pr dag.

ØT, finans@tdn.no
TDN Direkt, +47 21 95 60 70
TDN delayed

Både Avance og BW-LPG løfter sig op i slutauktionen og slutter stærkt igen i dag.

Avance Gas Holding er steget med 223% i år.

BW LPG er steget med 127%.

LPG Carriers: VLGC spot rates rose 19% w/w to $66k/d amidst another active week in the West. Asian LPG prices have increased lately, raising the regional price differential US vs Asia. This "arbitrage" now supports theoretical VLGC rates of $83k/d, and we see further upside in the near term.

Kursmål:
BWLPG: 89 NOK
Avance: 67 NOK

https://docs.wixstatic.com/ugd/5f38c3_63260fd6a80f488384bb101dac6eb868.pdf

Når NAT steg 20 % fredag, tror jeg, at det er fordi, at markedet ikke har glemt, hvordan NAT betaler udbytter i gode tider.

Lad os håbe på en gentagelse i 2020.

"Dry Bulk Shipping: The BDI fell 5% w/w, with similar losses in the sub-segments. We still believe we are close to a short-term trough, and that Capesize spot rates will rise in the coming months as Brazil again increases its iron ore exports from the current 27mt per month to 34mt tonnes. Panamaxes generally softened in the Atlantic as tonnage continued to build, but the rates ex-USG firmed slightly on rumors of Chinese buyers of grain.

Oil Tankers: What a week! VLCCs surging 71% to reach a 3-year-high. The impact from US sanctions on Chinese owners, a persistent risk premium after the Saudi attacks and scrubber retrofitting are the short-term catalysts. However, do not forget the underlying fundamental trends we have been highlighting for years: The lowest orderbook since 1997, increasing US exports, and the implications from IMO'20 are now highly tangible.

LNG Carriers: LNG carriers also wanting their spot in the limelight this week, with TFDEs quoted +16% w/w to $84k/d as we enter the high-season of the year. MEGI/XDFs now quoted at $100k/d, with Flex LNG (BUY/N185) said to have chartered out two vessels around the $100k/d mark.

LPG Carriers: VLGC spot rates rose 19% w/w to $66k/d amidst another active week in the West. Asian LPG prices have increased lately, raising the regional price differential US vs Asia. This "arbitrage" now supports theoretical VLGC rates of $83k/d, and we see further upside in the near term."

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