Two key factors determine the feasibility of coal use: Coal prices and shipping prices. The NCSC includes a designated shipping department which manages business negotiations with companies and brokers in the shipping area, as well as handling coal shipping contracts and Shipping schedules.
The company’s decentralization policy is based on risk management, and is designed to ensure continuous supply of coal to Israel at all times. Decentralization is implemented in shipping contracts covering different periods of time, some on a price-per-ton basis, and others on a ship time charter -per-day basis.
Some shipping contracts are COA-oriented (Contract Of Affreightment), and are based on the number of voyages performed. Under this type of contract, the company and the ship owner agree on a fixed number of voyages to be performed by the ship, originating in various international ports, for the duration of the contract. Other leasing contracts provide the company with control of the ship’s voyage schedule for the duration of the contract, and the company can sub-lease it to other entities.
Ship Time Chartering – Cost Factors
The cost of ship time chartering comprises expenses related to fuel, port disbursement , operation, and daily ship time chartering costs.
Large Bulk Carriers are high-risers reaching up to 10 stories, sometimes even containing an elevator..
The NCSC manages the shipping schedule while ensuring a punctual yet flexible timetable. This flexibility enables the company to optimize the discharge sequence in terms of savings, quality and operational needs. Generally, there are 3-4 ships on route to Israel, out of 25 ships actively sailing at any given time. Annually, there are around 80 coal ships arrivals at Israeli ports. 35% of these are Panamax Bulk Carriers carrying around 70,000 tons of coal on average, the unloading of which takes approximately two days. 65% of the shipping is handled by Capesize ships, carrying approximately 170 tons of coal, the unloading of which takes four-five days.
Ships Under Israeli Ownership
In accordance with the Israeli government’s decision to aid the Israeli fleet, the company operates two Israeli Capesize ships.
In order to avoid technical and operational issues, the company endeavors to use younger ships, up to 15 years of age.
Coal shipping to Israel entails 24/7 operations. We prepare a preliminary infrastructure, including analyzing risk levels of various shipping companies, forming contracts in accordance with these risk levels, and planning a long-term shipping schedule based on the Israel Electric Corporation’s consumption and the availability of energy-producing coal.
Shipping schedules are updated on an ongoing daily basis, in accordance with the timing of ship departures from origin ports, their arrival at the loading ports, loading and sailing procedures, arrival at Hadera or Ashkelon ports, and the unloading process at the ports.
- Weather conditions at sea ports and coal mines
- Technical difficulties
- Port strikes
- Coal shortage at the origin ports
- Pirate takeover of the ship
- Delay at the ports resulting from excessive congestion at origin ports
In order to maintain the coal stock levels required by IEC in the power stations at Ashkelon and Hadera, the shipping department specializes in creative solutions such as shipping cargos from various countries through alternating routes, transferring ships between various ports, loading ships at a number of different ports and switching ship arrival dates.