Is short supply linked to the wrong density on the BDN a coincidence?
9th June 2011 19:39 GMT

Density is one of the two parameters currently required to be included in the bunker delivery note (BDN) for all bunker supplies (the other being the fuel's sulphur content).

Knowing a fuel's density is important from an operational perspective, but it also has a commercial aspect.

Bunkers are typically sold in metric tonnes, but are measured during supply by volume.  The volume is converted into weight by means of the fuel density.  If the density is overstated, the calculated tonnage (and the invoice) will become too high and the buyer has been short-changed on quantity.

Testing agencies have often found that deviations in density on the BDN compared to tested values favour suppliers, or in other words, there was a short-delivery.   

Asked if this was the case, Dr. Vis, the founder of Viswa Lab said:  "It is true and for our major customers we regularly send a table comparing the BDN density with tested density and, after making allowance for permitted reproducibility errors as per ISO 4259, we tell them how many tonnes of difference and what is the value of this difference."

He said in most cases, he got the impression that buyers and suppliers were able to resolve density quantity disputes between themselves based on the test laboratory report.

"What is interesting is that the difference in quantity varies from shipping company to shipping company. I get a feeling that if the company is very strict and tight, the difference is less. If the bunker department is not very assertive, quantities tend to be large. One of our major customers who bunkers about 300 times a month suffers about 150 metric tonnes (mt) loss. Another company which bunkers 100 times a month suffers no more than 10 mt a month," Dr. Vis told Bunkerworld.

Michael Green, Technical Manager for Lintec Testing Services, provided Bunkerworld with statistics on density deviations in the BDN versus tested values.

He selected two separate time frames from the early part of this year and examined the variance in density figures seen.

"During the initial time period it was noted that approximately 54% of submitted samples showed a lower tested density than that stated on the supplied BDN.  12% of samples showed no variation between tested figures and quoted figures, while 34% of submitted samples demonstrated a higher tested density," Green said.

It means 54% of the density deviations were short-deliveries, while 34% were in favour of the buyer.
For the second time period examined by Green based on Lintec's data, 45% of submitted samples showed a lower tested density, 16% showed no variation, while 39% showed a higher tested density.  That means 45% of the density deviations were short-deliveries, while 39% were in favour of the buyer.

Anecdotal evidence from other testing agencies have pointed to density deviations favouring the supplier more often than Lintec found.
With high bunker prices, cut-throat competition and low or even non-existing profit margins on bunker sales, there is a temptation for bunker suppliers and barge operators to cheat on delivered quantity.  This is why interest has grown in the Coriolis flow meter technology, which is capable of accurately measuring mass directly, eliminating uncertainties relating to fuel density.

To gauge industry opinion on density deviations, the latest Bunkerworld poll asks:

Is short supply linked to the wrong density on the BDN a coincidence?

Is short supply linked to the wrong density on the BDN a coincidence?

  • 19% 
  • 9% 
  • 72% 

This poll is now closed.


Comments on this Article
Jose Rafal - Unioil Petroleum Philippines Inc.
26th June 2011
It is very much disadvantage to new entrant in the bunker industry that's why market intelligence is very much advise.

Comments have been closed for this article.

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