Ardmore Shipping is not just moving into the spot market; the company is diversifying its cargoes as well.
On the product tanker owner’s fourth-quarter earnings call on Tuesday, chief executive Anthony Gurnee said the Irish company was lifting more non-clean petroleum product cargoes in an effort to mitigate uncertainty in a struggling market.
“[Those cargoes] offer more trading flexibility, thus enhancing [time charter equivalent] performance,” Gurnee said on the call.
In its earnings report, the New York-listed company said it was taking its 21 MR tankers off time charters and placing them in the spot market in an effort to capitalise on what it believes is an improving market.
Ardmore said it expects to book 82% of its MR revenue days in the spot market for the first quarter of 2022.
So far, Ardmore said its MR fleet was earning an average of $13,725 per day through to 15 February, with 60% of days fixed versus $11,424 per day in the fourth quarter of 2021.
The company believes rising tonne-mile demand, increased scrapping and a small orderbook were reasons to be positive for the struggling sector, even though the market continues to be depressed thanks to Covid-19 and geopolitical issues posing significant risks.
Ardmore said it has been able to leverage its experience with chemical tankers to get into the non-clean petroleum product trades.
“There's also a lot of demand coming from biofuel, biofuel blending for anything that has to do with not just straight up petrochemical, chemical demand, but feedstock and blending feedstock for biofuels,” said chief commercial officer Gernot Ruppelt.
“We see a lot of that happening at the moment, and we’ve been able to capitalise on that.”
