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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, 27 August 21
THE ECONOMICS OF INDONESIA’S DIESEL POWER PLANT TO GAS CONVERSION PLAN ARE PROBLEMATIC - IEEFA
Deploying new small-scale LNG is an uphill battle for PGN
Indonesian gas is currently in a precarious position, where the government needs to ...
Thursday, 26 August 21
INDIA IMPORTED 17.06 MLN TONNES OF LPG IN 2020; UP 11.5% Y-O-Y
Global LPG trade remained fairly positive in 2020, despite the global economic impact from COVID-19, and surged strongly in the first half of 2021. ...
Thursday, 26 August 21
MARKET INSIGHT - INTERMODAL
24th of August 2021, the Baltic Dry Index reached 4,201, a YTD high and the highest since May 2010.
Cape 5TC daily average @ 51,472
...
Tuesday, 24 August 21
COAL PRICE RALLY TO PRESSURE CHINESE POWER GENCOS’ MARGINS FITCH RATINGS
Fitch Ratings expects the pressure on Chinese power generation companies’ (gencos) profit from the recent coal price surge to weaken their cr ...
Tuesday, 24 August 21
TIGHT POWER SUPPLY IN CHINA AMID STRONG DEMAND, HIGH COAL PRICES - FITCH RATINGS
China experienced tight power supply in 1H21 on stronger than expected power demand as economic activity continued to recover, Fitch Ratings says i ...
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- Global Business Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Latin American Coal - Colombia
- Trasteel International SA, Italy
- Ceylon Electricity Board - Sri Lanka
- Thai Mozambique Logistica
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kohat Cement Company Ltd. - Pakistan
- Australian Commodity Traders Exchange
- ICICI Bank Limited - India
- Ministry of Transport, Egypt
- Oldendorff Carriers - Singapore
- Indonesian Coal Mining Association
- Wilmar Investment Holdings
- SN Aboitiz Power Inc, Philippines
- Rashtriya Ispat Nigam Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- London Commodity Brokers - England
- Kapuas Tunggal Persada - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jindal Steel & Power Ltd - India
- GVK Power & Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- Coal and Oil Company - UAE
- Mintek Dendrill Indonesia
- Minerals Council of Australia
- Orica Mining Services - Indonesia
- Standard Chartered Bank - UAE
- Essar Steel Hazira Ltd - India
- Jaiprakash Power Ventures ltd
- Bukit Makmur.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GAC Shipping (India) Pvt Ltd
- Vizag Seaport Private Limited - India
- Maheswari Brothers Coal Limited - India
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- Energy Link Ltd, New Zealand
- Bhoruka Overseas - Indonesia
- Port Waratah Coal Services - Australia
- Goldman Sachs - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Wood Mackenzie - Singapore
- VISA Power Limited - India
- Vedanta Resources Plc - India
- Karaikal Port Pvt Ltd - India
- Sical Logistics Limited - India
- Gujarat Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Timah Investasi Mineral - Indoneisa
- Eastern Coal Council - USA
- Ambuja Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- Ministry of Finance - Indonesia
- Indo Tambangraya Megah - Indonesia
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Banpu Public Company Limited - Thailand
- The University of Queensland
- Mercator Lines Limited - India
- International Coal Ventures Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Indogreen Group - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Riau Bara Harum - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Cigading International Bulk Terminal - Indonesia
- Metalloyd Limited - United Kingdom
- Planning Commission, India
- Kalimantan Lumbung Energi - Indonesia
- SMC Global Power, Philippines
- IEA Clean Coal Centre - UK
- Aboitiz Power Corporation - Philippines
- Grasim Industreis Ltd - India
- Chettinad Cement Corporation Ltd - India
- Anglo American - United Kingdom
- Kartika Selabumi Mining - Indonesia
- Renaissance Capital - South Africa
- Georgia Ports Authority, United States
- Marubeni Corporation - India
- Meralco Power Generation, Philippines
- New Zealand Coal & Carbon
- Independent Power Producers Association of India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Agrawal Coal Company - India
- Carbofer General Trading SA - India
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Central Java Power - Indonesia
- Siam City Cement PLC, Thailand
- Singapore Mercantile Exchange
- Iligan Light & Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Sree Jayajothi Cements Limited - India
- Formosa Plastics Group - Taiwan
- Rio Tinto Coal - Australia
- Indian Energy Exchange, India
- Global Green Power PLC Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- LBH Netherlands Bv - Netherlands
- Mercuria Energy - Indonesia
- CNBM International Corporation - China
- Posco Energy - South Korea
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Lanco Infratech Ltd - India
- Electricity Generating Authority of Thailand
- PNOC Exploration Corporation - Philippines
- Mjunction Services Limited - India
- Global Coal Blending Company Limited - Australia
- Semirara Mining and Power Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sakthi Sugars Limited - India
- Toyota Tsusho Corporation, Japan
- Simpson Spence & Young - Indonesia
- Sojitz Corporation - Japan
- Savvy Resources Ltd - HongKong
- Attock Cement Pakistan Limited
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- MS Steel International - UAE
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Sinarmas Energy and Mining - Indonesia
- GMR Energy Limited - India
- Bharathi Cement Corporation - India
- Power Finance Corporation Ltd., India
- White Energy Company Limited
- Larsen & Toubro Limited - India
- Therma Luzon, Inc, Philippines
- Sarangani Energy Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Indian Oil Corporation Limited
- McConnell Dowell - Australia
- Ind-Barath Power Infra Limited - India
- Bangladesh Power Developement Board
- Medco Energi Mining Internasional
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Deloitte Consulting - India
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kumho Petrochemical, South Korea
- Kideco Jaya Agung - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Coalindo Energy - Indonesia
- Heidelberg Cement - Germany
- Chamber of Mines of South Africa
- Xindia Steels Limited - India
- Parliament of New Zealand
- Salva Resources Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Central Electricity Authority - India
- Romanian Commodities Exchange
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Orica Australia Pty. Ltd.
- South Luzon Thermal Energy Corporation
- Coastal Gujarat Power Limited - India
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Edison Trading Spa - Italy
- Bhatia International Limited - India
- Petron Corporation, Philippines
- Baramulti Group, Indonesia
- Thiess Contractors Indonesia
- Tamil Nadu electricity Board
- Pendopo Energi Batubara - Indonesia
- Cement Manufacturers Association - India
- Energy Development Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Manunggal Multi Energi - Indonesia
- Siam City Cement - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aditya Birla Group - India
- Australian Coal Association
- PowerSource Philippines DevCo
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- Binh Thuan Hamico - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- IHS Mccloskey Coal Group - USA
- Electricity Authority, New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Eastern Energy - Thailand
- Economic Council, Georgia
- Vijayanagar Sugar Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Star Paper Mills Limited - India
- Barasentosa Lestari - Indonesia
- Commonwealth Bank - Australia
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- Makarim & Taira - Indonesia
- Bulk Trading Sa - Switzerland
- Alfred C Toepfer International GmbH - Germany
- Globalindo Alam Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Indika Energy - Indonesia
- Videocon Industries ltd - India
- OPG Power Generation Pvt Ltd - India
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