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Monday, 27 February 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
 The pessimism in the dry market persists with the Baltic Dry Index still trying to find a steady pace of growth and average time charter earnings for all vessel classes floating at significantly lower levels than 2011. The steel market fundamentals have brought very low earnings for all dry bulk carrier vessels, even for smaller ones handies/supras, which were outperforming last year when capesizes and panamaxes were suffering. There are still hopes for improvement in March and onwards since January and February are seasonally weak months with Chinese buying less iron ore due to National Festivities and hefty stockpiles. Inventories at key Chinese steel mills monitored by China’s Iron & Steel Association reached 10.98 million tones by the end of January, the highest since the second half of 2009 and rising 24.5% from early January. CISA said in its monthly Report that it will be difficult for demand to improve significantly during end February to early March and inventories are likely to continue rising.
The world crude steel production for the 59 countries reporting to the World Steel Association was 117 million tonnes (Mt) in January 2012. This is -7.8% lower than January 2011. China’s crude steel production for January 2012 was 52.1 Mt, a decrease of -13% compared to January 2011. Elsewhere in Asia, Japan produced 8.6 Mt of crude steel in January 2012, a decrease of -10.6% compared to the same month last year. South Korea’s crude steel production for January 2012 was 5.1 Mt, -9.6% down compared to January 2011.
Despite the BDI lost again ground by falling every day during last week it finally ended to close in green with an improvement on Friday by earning 12 points from Thursday’s closing. The BDI closed at 717 points by gaining only 1 point from previous week’s closing of 718 points. Overall, all Baltic Dry Indices closed on green apart from panamaxes. There was an upturn in the capesize segment, a downward trend for panamax and a stronger performance in the supramax and handysize segments. The handysize segment showed the largest increase by gaining 16 points from last week, up 4.2% and ending at 395 points with vessel earnings near to $5,900/day in contrast with a 12% decline in the Baltic Panamax Index by loosing 113 points on a weekly basis and ending at 836 points. The BPI has surpassed the 1,000 points mark in mid February, by standing at 1018 points on February 14th, a yearly high level.
For large size vessels, capesizes, which typically transport 150,000 ton cargoes of iron ore and coal, the BCI ended by gaining 43 points on a weekly basis, up by 2.94% standing at 1504 points with a significant bounce back on Friday. Capesize earnings rose to $5,699/day from the yearly low of $5,158 on February 21st with China boosting its cargo demand loadings from Brazil and Australia. According to a London based analyst at derivatives broker Freight Investor Services Ltd there has been clearly some Chinese buying at these low freight levels that is sufficient to move rates up slightly. Prices (TSIPIO62) for iron ore imported into the Chinese city of Tianjin increased for a fifth session, gaining 0.2 percent to $139 a metric ton, according to figures from the Steel Index Ltd.
Spot prices of imported iron ore in China rose on Friday as traders bid up the market, betting on a recovery in domestic steel demand when construction projects resume next month. According to traders, global miner BHP Billiton sold several cargoes this week at prices around $3 more than previous deals. Australian Pilbara iron ore fines with 61.5 percent iron content was quoted at $138-$140 a tonne, cost and freight, up $2 from Thursday, according to Chinese consultancy Umetal. “Some traders are trying to push up the price because they think steel demand would pick up in March when the weather returns better and construction activity resumes in China”, he said. BHP rivals Rio Tinto and Vale were also offering more cargoes on Friday. Iron ore with a 62% content rose 2.1% to $138.70 per tonne on Thursday, its biggest percentage gain since December 21st, according to Steel Index price provider.
Panamax vessels, which usually transport 60,000-70,000 tonne cargoes of coal and grain, experienced severe decline with earnings falling below $7,000/day, when last year were earning around $14,000/day, and the BPI loosing 113 points from last week’s closing, down by 12% and standing at 836 points. The segment is feeling the pain from overcapacity with at least one panamax, kamsarmax or post panamax being delivered into service every day so far this year. Owners in the Atlantic are said to subsidizing their operating expenses as they are not earning enough to cover the cost of bunkers on ballast legs. With all February grain cargoes from east coast South America fixed to ships earlier this month, the vessels being booked at the moment for March loading dates are almost exclusive those ballasting from the Pacific markets.
Supramax vessels, which carry about 25 percent less than Panamaxes, showed healthier levels from a distressed Atlantic status with earnings rising near to panamax levels of about $6,900/day and the BSI gaining 21 points, up by 3.2% from last week’s closing and standing at 662 points. In addition, handysize units gained a sharp increase of 4.2% with the BHSI standing at 395 with earnings rising to $5,980/day, almost 40% lower than previous year when they earning near to $10,000/day.
Even the positive upturn seen during the last week in the freight markets there is still a road ahead for full recovery since the vessels’ glut is still a major threat for the dry bulk market and Chinese iron ore import market sentiment remains fragile with spot iron ore prices dropping on the increase of port stockpiles. The benchmark iron ore price trading was at $140/tonne in recent months from a record high of $180/tonne seen last year. The chief executive officer of Rio Tinto, the second largest supplier of iron ore, sees a period of volatility of six months for the iron ore market before stabilizing.
The steel needs from China and other developing countries are expected to ensure strong commodity demand on the long term, he added. "The world is an uncertain place at the moment and we have seen some softness in China, but demand remains strong," he said.
China alone will require at least another 100 million metric tons of iron ore a year for the next eight years, including 600 million tons in that period to satisfy growth and 200 million to replace the expected exit of high-cost supplies, he said, adding that Rio plans to contribute about a quarter of this additional ore to China.
The move of China to cut banks’ reserve requirements ratio by 0.5% to be effective from February 24th and Vale’s decision to move to spot iron ore pricing may be two positive key developments for the future of dry bulk earnings. Vale has announced that it will sell 80% of its iron ore at spot market pricing, which satisfies Chinese steelmakers by gaining from falling iron ore prices. February has almost ended and BDI has not still managed to break the psychological barrier of 1,000 points mark with earnings for capesize vessels trading at similar levels with handysizes. March may be a healthier month for large size units as Chinese iron ore stockpiles has shown a sense of retreat during the last days of February, by falling less than the record high of 100 mil tones seen almost two weeks ago, and a boosted Chinese cargo buying demand that increased capesize loadings from Australia and Brazil.
Source: Maria Bertzeletou, Hellenic Shipping
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Friday, 06 September 24
REBOUND IN OIL DEMAND COULD LIFT MARKET IN LATTER HALF OF 2024 - BIMCO
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Friday, 06 September 24
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SEABORNE COAL IMPORTS INTO INDIA INCREASED BY +9.9% Y-O-Y TO 146.6 MLN T - BANCHERO COSTA
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EXERCISE CAUTION WITH AMMONIA SWITCH - BALTIC EXCHANGE
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Friday, 02 August 24
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The recent surge in natural gas and coal prices has been so swift that the main benchmarks were roughly three times higher in 2022Q2 compared to a ...
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- Energy Link Ltd, New Zealand
- PowerSource Philippines DevCo
- Semirara Mining and Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Uttam Galva Steels Limited - India
- PNOC Exploration Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Latin American Coal - Colombia
- Mercuria Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Trasteel International SA, Italy
- Iligan Light & Power Inc, Philippines
- Commonwealth Bank - Australia
- Interocean Group of Companies - India
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- PetroVietnam Power Coal Import and Supply Company
- TeaM Sual Corporation - Philippines
- Grasim Industreis Ltd - India
- Sree Jayajothi Cements Limited - India
- Krishnapatnam Port Company Ltd. - India
- Billiton Holdings Pty Ltd - Australia
- Indian Oil Corporation Limited
- Indonesian Coal Mining Association
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wilmar Investment Holdings
- Central Electricity Authority - India
- Petron Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Electricity Generating Authority of Thailand
- GAC Shipping (India) Pvt Ltd
- Mercator Lines Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- VISA Power Limited - India
- Electricity Authority, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Kaltim Prima Coal - Indonesia
- Ambuja Cements Ltd - India
- Meralco Power Generation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Coal and Oil Company - UAE
- Independent Power Producers Association of India
- Bukit Baiduri Energy - Indonesia
- Tata Chemicals Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Renaissance Capital - South Africa
- Jindal Steel & Power Ltd - India
- Bhushan Steel Limited - India
- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Manunggal Multi Energi - Indonesia
- New Zealand Coal & Carbon
- Indika Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Metalloyd Limited - United Kingdom
- Posco Energy - South Korea
- Sindya Power Generating Company Private Ltd
- Maharashtra Electricity Regulatory Commission - India
- Goldman Sachs - Singapore
- Savvy Resources Ltd - HongKong
- Samtan Co., Ltd - South Korea
- Rashtriya Ispat Nigam Limited - India
- Parliament of New Zealand
- Directorate Of Revenue Intelligence - India
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- Straits Asia Resources Limited - Singapore
- Global Green Power PLC Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Lanco Infratech Ltd - India
- Globalindo Alam Lestari - Indonesia
- Carbofer General Trading SA - India
- Minerals Council of Australia
- SMC Global Power, Philippines
- Ministry of Transport, Egypt
- Kumho Petrochemical, South Korea
- Formosa Plastics Group - Taiwan
- Mjunction Services Limited - India
- Sarangani Energy Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Bhatia International Limited - India
- McConnell Dowell - Australia
- Alfred C Toepfer International GmbH - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- Edison Trading Spa - Italy
- The State Trading Corporation of India Ltd
- Rio Tinto Coal - Australia
- Star Paper Mills Limited - India
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Power Finance Corporation Ltd., India
- Gujarat Mineral Development Corp Ltd - India
- Sical Logistics Limited - India
- Global Business Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- Bukit Makmur.PT - Indonesia
- Coalindo Energy - Indonesia
- Bangladesh Power Developement Board
- ASAPP Information Group - India
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- Indian Energy Exchange, India
- Price Waterhouse Coopers - Russia
- Therma Luzon, Inc, Philippines
- Australian Commodity Traders Exchange
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Indo Tambangraya Megah - Indonesia
- Aboitiz Power Corporation - Philippines
- Medco Energi Mining Internasional
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- Orica Australia Pty. Ltd.
- Timah Investasi Mineral - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Attock Cement Pakistan Limited
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- Baramulti Group, Indonesia
- Antam Resourcindo - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Vedanta Resources Plc - India
- Mintek Dendrill Indonesia
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- Madhucon Powers Ltd - India
- Georgia Ports Authority, United States
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Standard Chartered Bank - UAE
- Agrawal Coal Company - India
- Planning Commission, India
- Thai Mozambique Logistica
- Wood Mackenzie - Singapore
- ICICI Bank Limited - India
- Romanian Commodities Exchange
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- Meenaskhi Energy Private Limited - India
- Bhoruka Overseas - Indonesia
- Chamber of Mines of South Africa
- Semirara Mining Corp, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Energy - Thailand
- Marubeni Corporation - India
- Aditya Birla Group - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Borneo Indobara - Indonesia
- Bayan Resources Tbk. - Indonesia
- GVK Power & Infra Limited - India
- Cement Manufacturers Association - India
- Merrill Lynch Commodities Europe
- Heidelberg Cement - Germany
- Global Coal Blending Company Limited - Australia
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- Maheswari Brothers Coal Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Makarim & Taira - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Bharathi Cement Corporation - India
- Bulk Trading Sa - Switzerland
- Vizag Seaport Private Limited - India
- Anglo American - United Kingdom
- IHS Mccloskey Coal Group - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Riau Bara Harum - Indonesia
- Australian Coal Association
- SN Aboitiz Power Inc, Philippines
- Parry Sugars Refinery, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- Sakthi Sugars Limited - India
- PTC India Limited - India
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Siam City Cement - Thailand
- Tamil Nadu electricity Board
- GN Power Mariveles Coal Plant, Philippines
- MS Steel International - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Sojitz Corporation - Japan
- Siam City Cement PLC, Thailand
- CNBM International Corporation - China
- The Treasury - Australian Government
- Ceylon Electricity Board - Sri Lanka
- CIMB Investment Bank - Malaysia
- Economic Council, Georgia
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- London Commodity Brokers - England
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
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