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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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Wednesday, 31 January 24
CHINA'S INNER MONGOLIA COAL OUTPUT HIT 1.21B TONS IN 2023 - XINHUA
North China’s Inner Mongolia autonomous region churned out 1.21 billion tons of coal in 2023 as it strives to guarantee the country’s e ...
Wednesday, 31 January 24
GAS EXPORTS COST U.S. CONSUMERS MORE THAN $100 BILLION OVER 16-MONTH PERIOD - IEEFA
Limited Demand Growth Could Dampen the Dry Bulk Market in the Coming Months BIMCOStarting in late 2021—before its invasion of Ukraine—R ...
Tuesday, 30 January 24
LIMITED DEMAND GROWTH COULD DAMPEN THE DRY BULK MARKET IN THE COMING MONTHS - BIMCO
Demand
In our base scenario, we expect cargo demand to grow by 0-1% in 2024 and 0.5-1.5% in 2025. This is a 0.5 percentage point reduction for ...
Friday, 26 January 24
RED SEA DIVERSIONS ADD NEARLY A MILLION DOLLARS PER VOYAGE TO SHIPPING COSTS WHILE DOUBLING TRANSIT TIME - LSEG
The incremental costs of diverting a tanker from Asia to NW Europe via the Cape of Good Hope is accounting for an extra $932,905 USD per voyage whi ...
Friday, 26 January 24
HARD COAL GUARDIAN ANGEL OF THE ENERGY SUPPLY - GERMANY COAL IMPORTERS ASSOCIATION
- No security of supply without hard coal
- The Substitute Power Plant Provision Act (EKBG) must be extended
- Higher grid fees due to the ...
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- Commonwealth Bank - Australia
- Australian Commodity Traders Exchange
- Indonesian Coal Mining Association
- Petron Corporation, Philippines
- Minerals Council of Australia
- Indogreen Group - Indonesia
- Baramulti Group, Indonesia
- ASAPP Information Group - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Port Waratah Coal Services - Australia
- Mintek Dendrill Indonesia
- Krishnapatnam Port Company Ltd. - India
- Global Green Power PLC Corporation, Philippines
- Cement Manufacturers Association - India
- Australian Coal Association
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Price Waterhouse Coopers - Russia
- White Energy Company Limited
- London Commodity Brokers - England
- PNOC Exploration Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- The University of Queensland
- Riau Bara Harum - Indonesia
- Attock Cement Pakistan Limited
- Singapore Mercantile Exchange
- Aboitiz Power Corporation - Philippines
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- Ministry of Finance - Indonesia
- Heidelberg Cement - Germany
- Kepco SPC Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Mercuria Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Africa Commodities Group - South Africa
- Energy Link Ltd, New Zealand
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Parliament of New Zealand
- PTC India Limited - India
- Coalindo Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Semirara Mining Corp, Philippines
- Sojitz Corporation - Japan
- Electricity Authority, New Zealand
- Indian Energy Exchange, India
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- Banpu Public Company Limited - Thailand
- Global Coal Blending Company Limited - Australia
- Antam Resourcindo - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Karaikal Port Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Tamil Nadu electricity Board
- Thiess Contractors Indonesia
- Medco Energi Mining Internasional
- Offshore Bulk Terminal Pte Ltd, Singapore
- Pendopo Energi Batubara - Indonesia
- European Bulk Services B.V. - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Vizag Seaport Private Limited - India
- Georgia Ports Authority, United States
- Kalimantan Lumbung Energi - Indonesia
- New Zealand Coal & Carbon
- Chamber of Mines of South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Borneo Indobara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- GAC Shipping (India) Pvt Ltd
- Ministry of Transport, Egypt
- Bharathi Cement Corporation - India
- Meralco Power Generation, Philippines
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- Bhushan Steel Limited - India
- Ambuja Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Makarim & Taira - Indonesia
- Directorate Of Revenue Intelligence - India
- Straits Asia Resources Limited - Singapore
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- Indo Tambangraya Megah - Indonesia
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Wilmar Investment Holdings
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Power Finance Corporation Ltd., India
- Bangladesh Power Developement Board
- McConnell Dowell - Australia
- Sindya Power Generating Company Private Ltd
- Globalindo Alam Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Interocean Group of Companies - India
- Bhoruka Overseas - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- The State Trading Corporation of India Ltd
- Samtan Co., Ltd - South Korea
- Mjunction Services Limited - India
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- CNBM International Corporation - China
- Altura Mining Limited, Indonesia
- Essar Steel Hazira Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Indian Oil Corporation Limited
- Asmin Koalindo Tuhup - Indonesia
- GMR Energy Limited - India
- Tata Chemicals Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Xindia Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Deloitte Consulting - India
- GVK Power & Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- IHS Mccloskey Coal Group - USA
- Agrawal Coal Company - India
- Mercator Lines Limited - India
- Cigading International Bulk Terminal - Indonesia
- Iligan Light & Power Inc, Philippines
- Larsen & Toubro Limited - India
- Formosa Plastics Group - Taiwan
- Eastern Energy - Thailand
- Indika Energy - Indonesia
- Eastern Coal Council - USA
- Bahari Cakrawala Sebuku - Indonesia
- Kartika Selabumi Mining - Indonesia
- Vedanta Resources Plc - India
- Bulk Trading Sa - Switzerland
- Energy Development Corp, Philippines
- Lanco Infratech Ltd - India
- Central Electricity Authority - India
- Coastal Gujarat Power Limited - India
- Manunggal Multi Energi - Indonesia
- PowerSource Philippines DevCo
- VISA Power Limited - India
- Posco Energy - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Bhatia International Limited - India
- Goldman Sachs - Singapore
- Global Business Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- Videocon Industries ltd - India
- Jaiprakash Power Ventures ltd
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- Ministry of Mines - Canada
- TeaM Sual Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- India Bulls Power Limited - India
- MS Steel International - UAE
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- Therma Luzon, Inc, Philippines
- Grasim Industreis Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Vijayanagar Sugar Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Star Paper Mills Limited - India
- South Luzon Thermal Energy Corporation
- Coal and Oil Company - UAE
- Jindal Steel & Power Ltd - India
- Sakthi Sugars Limited - India
- Madhucon Powers Ltd - India
- Bukit Baiduri Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Uttam Galva Steels Limited - India
- Thai Mozambique Logistica
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- IEA Clean Coal Centre - UK
- Latin American Coal - Colombia
- Standard Chartered Bank - UAE
- Karbindo Abesyapradhi - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Leighton Contractors Pty Ltd - Australia
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Dalmia Cement Bharat India
- Maharashtra Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- International Coal Ventures Pvt Ltd - India
- Siam City Cement - Thailand
- Planning Commission, India
- Wood Mackenzie - Singapore
- Sinarmas Energy and Mining - Indonesia
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
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