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Tuesday, 19 June 12
SMALLER DRY BULK CARRIERS LIFT UP MARKET, PANAMAXES SET TO FALL SAYS ANALYST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 Another rise for the dry bulk market was evident yesterday, as the industry’s benchmark, the BDI (Baltic Dry Index) was up for a ninth straight session to 938 points, rising by 14 points. The rise was once again triggered by the smaller ship types, with the Panamax market rising by 16 points, or 1.5% to 1,081 points, with average daily earnings rising to $8,592. By contrast, the Capesize market was once again falling, with the relative index falling by 10 points to 1,138 points, as a result of tumbling iron ore demand. As a result average daily earnings dropping at just $3,377, a multi-year low.
In a relative note, analyst Commodore Research predicted a new fall of the market, which will most likely impact Panamaxes the most. Commodore mentioned that “it might be hard for some to believe, but at the start of the year capesize rates were averaging $23,991/day. Capesize rates quickly came under intense vessel supply-related pressure, however, and have remained below $10,000/day since January 12th. More recently, rates have come under additional pressure due to the ongoing lull in Chinese iron ore demand. While near-term prospects for capesize rates remain bleak - first and foremost due to the tremendous amount of capesize vessels that will remain available in the market - a strong case can be made that future prospects for panamax rates are considerably worse” said Commodore.
It concluded by mentioning that “for the second half of this year, the orderbook for panamax vessels stands at roughly 355 vessels, while the orderbook for capesize vessels stands at roughly 145 vessels. The 2013 panamax orderbook dwarfs the 2013 capesize orderbook as well. For 2013, the orderbook for panamax vessels stands at roughly 240 vessels, while the orderbook for capesize vessels stands at roughly 90 vessels. In 2013, the panamax market is poised to become the most oversupplied of all of the dry bulk vessel classes. The 595 panamax vessels expected to be delivered by the end of 2013 represent a growth of approximately 28% on the current panamax fleet. The 235 capesize vessels expected to be delivered represent a growth of approximately 16% on the current capesize fleet. While the story for 2012 will likely remain the depressed capesize market, panamax rates are likely to feel great pain in 2013” said Commodore.
In an earlier note, BIMCO had noted that “the dry bulk market is under immense pressure, as the retreating weight of China as the driver of the market is extensively felt. At a time when supply growth simply breaks new mind-blowing delivery records, the demand situation is pitching in a bit too. Currently, there are reports of Chinese customers in the steel industry that are refusing to honour their contract as prices drop, and stock piles are fuller than normal at a time when steel mills take their foot off the throttle following a red-hot production period in recent months. Current fundamental demand/consumption is not strong enough to support such a high production level. As the world awaits the next anticipated Chinese stimulus package to lift demand, the dry bulk market is scouting for another saviour to get it through the day. Crude steel production in China surpassed 60 million tons a month in both March and April. The monthly average in 2011 was 57 million per month” said BIMCO.
It added that “the first five months average earnings of a Capesize bulker ended at USD 7,013 per day. This is down by 13% as compared to the same period last year that earned USD 8,060 per day. The time charter average has only been above USD 10,000 per day in the first 11 days of the year. The brief strengthening of freight rates in the midst of May unfortunately proved to be short-lived. As suggested two months ago, the downward overshooting of rates was corrected upwards with stronger rates during April and the first half of May, but as the optimism in the macroeconomic picture also began to fade, so did the freight market.
China imports more coal when the price gap between Chinese thermal coal (less a heat discount) and imported thermal coal is providing an arbitrage opportunity (including freight costs). When e.g. Australian or Indonesian coal prices become relatively cheaper, Chinese buyers are interested in importing more coal from Australia, which is good news for ship owners. In 2011 the price gap widened substantially, leading to hitherto unseen levels of thermal coal imports to China. If the price of Australian and Indonesian coal drops below the price of Chinese coal, as has been the case the last few months, we might see Chinese imports get back strongly when coal demand peaks in July. This could make 2012 imports surpass those record volumes of 2011” BIMCO concluded.
Source: Nikos Roussanoglou, Hellenic Shipping
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Friday, 23 February 24
STRONG OUTLOOK FOR THE TANKER MARKET IN 2024 AND BEYOND - DNV
Several factors have aligned over the past two years to create a robust and profitable market for tanker owners, which is expected to drive newbuil ...
Friday, 23 February 24
AUSTRALIAN COAL FLOWS TO ASIA HOVER ABOVE LAST YEAR’S VOLUME TONNES - SIGNAL GROUP
In the final days of February, the dry bulk freight market appeared to maintain a relatively stable momentum, particularly evident in the large ves ...
Friday, 23 February 24
RUSSIAN COAL SHIPMENTS FALL 14% AS SANCTIONS BITE - BIMCO
During the first seven weeks of 2024, Russian coal shipments have fallen 14% y/y. Volumes have gradually declined since October 2023 when logistica ...
Thursday, 22 February 24
BIMCO PUBLISHES SHIP FINANCING FORMS TO ENSURE UNINTERRUPTED USE OF SHIPS
BIMCO has published two standard Quiet Enjoyment Letters (QELs), the first standard form QELs available to the industry, to offer a tool that can e ...
Monday, 19 February 24
METALS INVESTMENT: THE DARKEST HOUR IS JUST BEFORE THE DAWN - WOOD MACKENZIE
Things often seem at their worst just before they get better. In terms of meeting our net zero 2050 scenario, we’ve reached a watershed momen ...
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- Singapore Mercantile Exchange
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement - Thailand
- Commonwealth Bank - Australia
- Sindya Power Generating Company Private Ltd
- GVK Power & Infra Limited - India
- Indika Energy - Indonesia
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Maheswari Brothers Coal Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Merrill Lynch Commodities Europe
- Goldman Sachs - Singapore
- Parliament of New Zealand
- Sakthi Sugars Limited - India
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- Wilmar Investment Holdings
- Ind-Barath Power Infra Limited - India
- Central Electricity Authority - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Barasentosa Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Riau Bara Harum - Indonesia
- Port Waratah Coal Services - Australia
- The Treasury - Australian Government
- Antam Resourcindo - Indonesia
- Kartika Selabumi Mining - Indonesia
- Siam City Cement PLC, Thailand
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Standard Chartered Bank - UAE
- Indian Oil Corporation Limited
- PNOC Exploration Corporation - Philippines
- Price Waterhouse Coopers - Russia
- GAC Shipping (India) Pvt Ltd
- Australian Commodity Traders Exchange
- Larsen & Toubro Limited - India
- Bharathi Cement Corporation - India
- Essar Steel Hazira Ltd - India
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- White Energy Company Limited
- Simpson Spence & Young - Indonesia
- Sarangani Energy Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Intertek Mineral Services - Indonesia
- Meralco Power Generation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Global Business Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Medco Energi Mining Internasional
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Romanian Commodities Exchange
- Bangladesh Power Developement Board
- Aditya Birla Group - India
- PowerSource Philippines DevCo
- GMR Energy Limited - India
- Ceylon Electricity Board - Sri Lanka
- Energy Development Corp, Philippines
- Ministry of Transport, Egypt
- Kepco SPC Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Holcim Trading Pte Ltd - Singapore
- PTC India Limited - India
- Agrawal Coal Company - India
- Leighton Contractors Pty Ltd - Australia
- Sojitz Corporation - Japan
- TNB Fuel Sdn Bhd - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Metalloyd Limited - United Kingdom
- Indogreen Group - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Malabar Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- India Bulls Power Limited - India
- Kobexindo Tractors - Indoneisa
- Cement Manufacturers Association - India
- Minerals Council of Australia
- Bukit Makmur.PT - Indonesia
- CIMB Investment Bank - Malaysia
- Salva Resources Pvt Ltd - India
- Trasteel International SA, Italy
- Indonesian Coal Mining Association
- CNBM International Corporation - China
- Mercator Lines Limited - India
- Sical Logistics Limited - India
- Oldendorff Carriers - Singapore
- Samtan Co., Ltd - South Korea
- Bukit Baiduri Energy - Indonesia
- Mjunction Services Limited - India
- MS Steel International - UAE
- TeaM Sual Corporation - Philippines
- Mercuria Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- International Coal Ventures Pvt Ltd - India
- Parry Sugars Refinery, India
- Kaltim Prima Coal - Indonesia
- Makarim & Taira - Indonesia
- Chettinad Cement Corporation Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Orica Australia Pty. Ltd.
- European Bulk Services B.V. - Netherlands
- Star Paper Mills Limited - India
- Indo Tambangraya Megah - Indonesia
- Xindia Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Anglo American - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Eastern Coal Council - USA
- Sree Jayajothi Cements Limited - India
- Globalindo Alam Lestari - Indonesia
- SMG Consultants - Indonesia
- IEA Clean Coal Centre - UK
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Semirara Mining and Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Karaikal Port Pvt Ltd - India
- Thai Mozambique Logistica
- Lanco Infratech Ltd - India
- Tata Chemicals Ltd - India
- Electricity Authority, New Zealand
- Bulk Trading Sa - Switzerland
- Krishnapatnam Port Company Ltd. - India
- The State Trading Corporation of India Ltd
- Vedanta Resources Plc - India
- Power Finance Corporation Ltd., India
- Coalindo Energy - Indonesia
- Electricity Generating Authority of Thailand
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- Meenaskhi Energy Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Independent Power Producers Association of India
- AsiaOL BioFuels Corp., Philippines
- Coastal Gujarat Power Limited - India
- Planning Commission, India
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- Energy Link Ltd, New Zealand
- Gujarat Sidhee Cement - India
- Mintek Dendrill Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- Coal and Oil Company - UAE
- Dalmia Cement Bharat India
- Videocon Industries ltd - India
- Billiton Holdings Pty Ltd - Australia
- Borneo Indobara - Indonesia
- McConnell Dowell - Australia
- Global Coal Blending Company Limited - Australia
- Toyota Tsusho Corporation, Japan
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Altura Mining Limited, Indonesia
- Tamil Nadu electricity Board
- Georgia Ports Authority, United States
- Baramulti Group, Indonesia
- Uttam Galva Steels Limited - India
- Petron Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Carbofer General Trading SA - India
- Iligan Light & Power Inc, Philippines
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- Bhatia International Limited - India
- Deloitte Consulting - India
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Marubeni Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Miang Besar Coal Terminal - Indonesia
- Australian Coal Association
- Orica Mining Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Latin American Coal - Colombia
- London Commodity Brokers - England
- Formosa Plastics Group - Taiwan
- Grasim Industreis Ltd - India
- Ministry of Mines - Canada
- Binh Thuan Hamico - Vietnam
- New Zealand Coal & Carbon
- Indian Energy Exchange, India
- The University of Queensland
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- VISA Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Posco Energy - South Korea
- Alfred C Toepfer International GmbH - Germany
- SMC Global Power, Philippines
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