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Thursday, 13 June 13
BIMCO EXPECTS SUBDUED CAPESIZE EARNINGS FOR THE COMING WEEKS - HELLENIC SHIPPING NEWS
 Bulk is not only about China even though it is a key driver. In this section, we have taken a closer look at the European seaborne coal markets, which is going through some interesting times right now. European coal demand has been in a slump ever since early 2009, where seaborne demand fell by 14 million tons from the first to the second quarter. Import volumes during the last three quarters of 2011 indicated that seaborne coal demand was recovering, but the development stalled somewhat in 2012. Looking on a country basis, the nation with the biggest decline was Italy, with annual seaborne imports being roughly 8 million tons lower today than before the financial crisis. France has also decreased its imports by around 4-5 million tons annually. The United Kingdom and Spain have weakened as well, but these countries seem to be on a rebound, with volumes being slightly below pre-financial crisis levels. The Netherlands and Germany have had relatively stable import numbers since 2005.
The bulk of seaborne coal going to Europe comes from North America, Colombia and Russia. The United States and Colombia have doubled their exports to Europe, while Russia has maintained its share of the European demand. Russian coal is shipped from both Russian and Latvian ports; Colombian coal is primarily shipped from the Caribbean, while US coal is primarily shipped from the Atlantic Coast and the Mexican Gulf. The drop in European seaborne demand for coal did not affect these countries, but rather South Africa. From being the single largest coal exporter to Europe with 52.0 million tons in 2005, the country has become a footnote, with 13.6 million tons in 2011. This represents bad business for the shipping industry, since the sailing distance from Richards Bay to Rotterdam is 98% longer than from Hampton Roads and 61% longer than from Puerto Bolivar.
Although European coal imports didn’t tell a particular positive story for shipping, US exports most certainly did. We expect to publish a story on this within the next couple of weeks.
On a more general note regarding the bulk market, China is expected to increase its imports of wheat, as sub-standard storage facilities have damaged a part of the huge Chinese stockpiles. Traders said that China is seeking to increase imports when global prices are in a slump. Current forward prices indicate that this may happen during the third quarter of 2013. According to Chinese customs statistics, the main exporters of wheat to China are Australia, Canada and United States, the latter two providing significant tonne miles.
Meanwhile, Argentina is exporting record high volumes of grains; CRSL reported that Argentina exported 4.86 million tons of grains in March – the highest number ever for a single month. This gave a spike in Panamax rates with the BPI staying just below the psychological barrier of USD 10,000 per day in March and April, but earnings are now slightly lower at around USD 7,000 per day. In our last report, we predicted that Panamax rates would stay in the USD 5,000-10,000 per day territory; going forward seasonal events like Argentinian exports are likely to provide for the upside ticks.
SUPPLY
New dry bulk deliveries walk the anticipated line and have now reached 29 million DWT. Meanwhile, 11 million DWT have been sold for recycling, which brings the year-to-date fleet growth up to 2.8%. The inflow is seen primarily in the Panamax segment, where 136 (in 2012: 162) new vessels are keeping Panamax fleet growth high. Simultaneously, the Capesize segment only saw 48 (in 2012: 115) new vessels coming on stream, eventually easing some of the pain from the current overcapacity.
Average age and size of the demolished tonnage is 28 years and 60,000 DWT. In line with the development seen in the last couple of years, the average age is still trending down – whereas the average size is essentially unchanged. BIMCO forecasts a slightly lower level of tonnage being demolished in 2013 as compared to last year; however, it is still going to be the second-largest year on record. The solid level of demolition prices will inspire owners to consider recycling, rather than trading their old tonnage in a very volatile market without certainty of sustainable freight rates and against more energy efficient tonnage.
As regards the orderbook, it’s also moving in the right direction in spite of the recent flurry of new orders for more fuel-efficient tonnage. During the past 10 weeks the number of newbuilding orders in the book has come down from 1,599 to 1,548. Finally, on the ordering side, strong interest in Capesizes remains evident, with 62 new orders in 2013. A total of 18 million DWT has been ordered in the year so far, with March and April seeing total new orders placed in excess of 4.5 million DWT each month.
OUTLOOK
The Summer lull is creeping up on dry bulk shipping demand following the successful South American grain season. Fortunately, solid demand is keeping spirits up in the dry bulk industry, while the severe extent of overcapacity is pushing the date for a full-blown recovery of earnings into a somewhat distant future. For now the market is getting more and more spot focused, as no owners want to commit tonnage for longer terms at offered levels. Don’t look at the paper market for any support, because you won’t find it. FFA indications (10/6) for Capesize tonnage go to the tune of USD per day: Q3-13, Q4-13, Cal 14 and Cal 15: 7,550, 12,000, 11,450 and 13,700 and for Supramax the indications go as follows in USD per day for the same dates: 7,900, 8,400, 8,600 and 8,900. USD per day in the spot market (10/6): Capesize for 5,571 and Supramax for 9,307.
Expect the unexpected from the dry bulk market seems to be the message passed on in recent years – and today is no different, as Handysize tonnage is earning USD 10,900 per day on an Atlantic round voyage whereas Capesizes are struggling to get a 1 year T/C fixed at USD 10,500 per day if at all. With respect to freight rates for Panamax and Supramax tonnage, they have lost ground since the beginning of March.
To sum up, our forecast for the coming 6 weeks: BIMCO holds the view that Capesize TC average rates are expected to remain subdued around USD 4,500-7,500 per day. Panamax is expected to stay in the USD 4,500-8,000 per day interval. For the Supramax segment, BIMCO forecasts freight rates in the USD 7,000-10,000 per day interval, whereas Handysize rates are forecast to stay at the interval of USD 6,000-8,500 per day.
Source: BIMCO / Hellenic Shipping News
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Friday, 06 September 24
REBOUND IN OIL DEMAND COULD LIFT MARKET IN LATTER HALF OF 2024 - BIMCO
Supply/demand
Based on a strong second half demand, the supply/balance is forecast to strengthen in 2024 but weaken slightly in 2025 as n ...
Friday, 06 September 24
GLOBAL SEABORNE LNG TRADE HAS CONTINUED TO INCREASE LAST YEAR - BANCHERO COSTA
Global seaborne LNG trade has continued to increase last year, helped also by the events in Ukraine which forced Europe to diversify away from Russ ...
Wednesday, 28 August 24
SEABORNE COAL IMPORTS INTO INDIA INCREASED BY +9.9% Y-O-Y TO 146.6 MLN T - BANCHERO COSTA
Global coal trade has really picked up pace over the past year, and is now fully back to pre-Covid levels said Banchero Costa Research in its lates ...
Tuesday, 06 August 24
EXERCISE CAUTION WITH AMMONIA SWITCH - BALTIC EXCHANGE
A new study from the Massachusetts Institute of Technology (MIT) has thrown a spanner into the plan to transition ships from diesel fuel to ammonia ...
Friday, 02 August 24
ENERGY MARKET DEVELOPMENTS: COAL AND NATURAL GAS PRICES REACH RECORD HIGHS - WORLD BANK
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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- CNBM International Corporation - China
- TNB Fuel Sdn Bhd - Malaysia
- Attock Cement Pakistan Limited
- Central Electricity Authority - India
- Vizag Seaport Private Limited - India
- AsiaOL BioFuels Corp., Philippines
- Parliament of New Zealand
- Indogreen Group - Indonesia
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- San Jose City I Power Corp, Philippines
- Agrawal Coal Company - India
- Ambuja Cements Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Malabar Cements Ltd - India
- Dalmia Cement Bharat India
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Xindia Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Savvy Resources Ltd - HongKong
- Grasim Industreis Ltd - India
- Electricity Authority, New Zealand
- Kapuas Tunggal Persada - Indonesia
- Sical Logistics Limited - India
- GAC Shipping (India) Pvt Ltd
- Oldendorff Carriers - Singapore
- Rio Tinto Coal - Australia
- IHS Mccloskey Coal Group - USA
- Mintek Dendrill Indonesia
- Bhushan Steel Limited - India
- Jindal Steel & Power Ltd - India
- Thiess Contractors Indonesia
- Tamil Nadu electricity Board
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- Alfred C Toepfer International GmbH - Germany
- McConnell Dowell - Australia
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Madhucon Powers Ltd - India
- Coastal Gujarat Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meralco Power Generation, Philippines
- Barasentosa Lestari - Indonesia
- Intertek Mineral Services - Indonesia
- Kepco SPC Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Maharashtra Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- LBH Netherlands Bv - Netherlands
- Deloitte Consulting - India
- Ministry of Finance - Indonesia
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- Australian Commodity Traders Exchange
- Sindya Power Generating Company Private Ltd
- Cement Manufacturers Association - India
- PTC India Limited - India
- Medco Energi Mining Internasional
- International Coal Ventures Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- Kideco Jaya Agung - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Anglo American - United Kingdom
- Minerals Council of Australia
- Maheswari Brothers Coal Limited - India
- MS Steel International - UAE
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- South Luzon Thermal Energy Corporation
- Wood Mackenzie - Singapore
- Mjunction Services Limited - India
- Bukit Baiduri Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Kobexindo Tractors - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Parry Sugars Refinery, India
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- Sakthi Sugars Limited - India
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- Economic Council, Georgia
- Timah Investasi Mineral - Indoneisa
- Indika Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Eastern Coal Council - USA
- Edison Trading Spa - Italy
- Toyota Tsusho Corporation, Japan
- Global Coal Blending Company Limited - Australia
- Indonesian Coal Mining Association
- Planning Commission, India
- Billiton Holdings Pty Ltd - Australia
- ICICI Bank Limited - India
- Essar Steel Hazira Ltd - India
- ASAPP Information Group - India
- Pendopo Energi Batubara - Indonesia
- Gujarat Sidhee Cement - India
- Miang Besar Coal Terminal - Indonesia
- Aboitiz Power Corporation - Philippines
- Commonwealth Bank - Australia
- Karbindo Abesyapradhi - Indoneisa
- Antam Resourcindo - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Price Waterhouse Coopers - Russia
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Global Green Power PLC Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Singapore Mercantile Exchange
- VISA Power Limited - India
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Ceylon Electricity Board - Sri Lanka
- PNOC Exploration Corporation - Philippines
- Posco Energy - South Korea
- Orica Mining Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Power Finance Corporation Ltd., India
- Sojitz Corporation - Japan
- Semirara Mining Corp, Philippines
- Sinarmas Energy and Mining - Indonesia
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Vedanta Resources Plc - India
- Altura Mining Limited, Indonesia
- The University of Queensland
- Kaltim Prima Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- London Commodity Brokers - England
- Offshore Bulk Terminal Pte Ltd, Singapore
- Interocean Group of Companies - India
- Africa Commodities Group - South Africa
- OPG Power Generation Pvt Ltd - India
- Borneo Indobara - Indonesia
- White Energy Company Limited
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Therma Luzon, Inc, Philippines
- Romanian Commodities Exchange
- Gujarat Mineral Development Corp Ltd - India
- Mercator Lines Limited - India
- Trasteel International SA, Italy
- IEA Clean Coal Centre - UK
- Iligan Light & Power Inc, Philippines
- Sarangani Energy Corporation, Philippines
- New Zealand Coal & Carbon
- Latin American Coal - Colombia
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- SMC Global Power, Philippines
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- The Treasury - Australian Government
- Lanco Infratech Ltd - India
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Kartika Selabumi Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bukit Makmur.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Mines - Canada
- Bukit Asam (Persero) Tbk - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- Manunggal Multi Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Independent Power Producers Association of India
- Siam City Cement PLC, Thailand
- Energy Development Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Chamber of Mines of South Africa
- GMR Energy Limited - India
- Aditya Birla Group - India
- GVK Power & Infra Limited - India
- Coalindo Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Australian Coal Association
- Port Waratah Coal Services - Australia
- SMG Consultants - Indonesia
- Goldman Sachs - Singapore
- PowerSource Philippines DevCo
- Larsen & Toubro Limited - India
- Tata Chemicals Ltd - India
- Marubeni Corporation - India
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
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