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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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Thursday, 25 January 24
THE RED SEA ESCALATION IMPLICATIONS ON GLOBAL SEABORNE TRADE - MARIA BERTZELETOU
In recent days, discussions have intensified about the potential impact on the seaborne trade and ton-miles due to the evolving dynamics of market ...
Thursday, 25 January 24
RED SEA SHIPPING DISRUPTIONS KEEP GEOPOLITICAL PREMIUM FOR COMMODITIES - FITCH RATINGS
Shipping disruptions and re-routing away from the Red Sea will maintain the geopolitical premium in the main commodity markets, including for oil a ...
Friday, 19 January 24
INDONESIA TARGETS 710 MLN METRIC TONS COAL OUTPUT IN 2024 AFTER RECORD 2023 - REUTERS
Indonesia, a major thermal coal exporter, aims to produce 710 million metric tons of coal in 2024, its mining minister said on Monday, after postin ...
Friday, 19 January 24
DRUMMOND COLOMBIA COAL OUTPUT ROSE 7.1% IN 2023 - REUTERS
Coal production from miner Drummond’s Colombia operations rose 7.1% in 2023 to 29.5 million metric tons, while exports declined by 2.6% to 27 ...
Friday, 19 January 24
CHINA'S 2023 COAL OUTPUT HITS RECORD HIGH - REUTERS
China’s coal output reached a record high in 2023, data from the statistics bureau showed on Wednesday, amid an ongoing focus on energy secur ...
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- Ind-Barath Power Infra Limited - India
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- Therma Luzon, Inc, Philippines
- New Zealand Coal & Carbon
- PTC India Limited - India
- Riau Bara Harum - Indonesia
- Bukit Baiduri Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Merrill Lynch Commodities Europe
- Essar Steel Hazira Ltd - India
- Manunggal Multi Energi - Indonesia
- The University of Queensland
- Medco Energi Mining Internasional
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- Cigading International Bulk Terminal - Indonesia
- Orica Australia Pty. Ltd.
- Wood Mackenzie - Singapore
- Singapore Mercantile Exchange
- Petron Corporation, Philippines
- Energy Development Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- PowerSource Philippines DevCo
- Vijayanagar Sugar Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Minerals Council of Australia
- Larsen & Toubro Limited - India
- Tata Chemicals Ltd - India
- Heidelberg Cement - Germany
- Oldendorff Carriers - Singapore
- PNOC Exploration Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Attock Cement Pakistan Limited
- Uttam Galva Steels Limited - India
- GMR Energy Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indogreen Group - Indonesia
- Pendopo Energi Batubara - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- Sarangani Energy Corporation, Philippines
- Eastern Energy - Thailand
- Maheswari Brothers Coal Limited - India
- Goldman Sachs - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- VISA Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Business Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Binh Thuan Hamico - Vietnam
- Cement Manufacturers Association - India
- European Bulk Services B.V. - Netherlands
- Metalloyd Limited - United Kingdom
- SMG Consultants - Indonesia
- Kobexindo Tractors - Indoneisa
- Indian Energy Exchange, India
- AsiaOL BioFuels Corp., Philippines
- Barasentosa Lestari - Indonesia
- Commonwealth Bank - Australia
- Rashtriya Ispat Nigam Limited - India
- Antam Resourcindo - Indonesia
- IEA Clean Coal Centre - UK
- Agrawal Coal Company - India
- Marubeni Corporation - India
- Kapuas Tunggal Persada - Indonesia
- Rio Tinto Coal - Australia
- Directorate General of MIneral and Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Formosa Plastics Group - Taiwan
- Central Java Power - Indonesia
- SMC Global Power, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Samtan Co., Ltd - South Korea
- Electricity Authority, New Zealand
- GN Power Mariveles Coal Plant, Philippines
- Jaiprakash Power Ventures ltd
- LBH Netherlands Bv - Netherlands
- Bharathi Cement Corporation - India
- Videocon Industries ltd - India
- ICICI Bank Limited - India
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- Independent Power Producers Association of India
- Standard Chartered Bank - UAE
- Ministry of Mines - Canada
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Siam City Cement - Thailand
- Kepco SPC Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Borneo Indobara - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Electricity Generating Authority of Thailand
- Bhoruka Overseas - Indonesia
- OPG Power Generation Pvt Ltd - India
- Posco Energy - South Korea
- CNBM International Corporation - China
- Baramulti Group, Indonesia
- TeaM Sual Corporation - Philippines
- India Bulls Power Limited - India
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- Indika Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Bhatia International Limited - India
- Orica Mining Services - Indonesia
- Global Coal Blending Company Limited - Australia
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- Carbofer General Trading SA - India
- The Treasury - Australian Government
- Leighton Contractors Pty Ltd - Australia
- Ministry of Finance - Indonesia
- Wilmar Investment Holdings
- GVK Power & Infra Limited - India
- Sakthi Sugars Limited - India
- Intertek Mineral Services - Indonesia
- Latin American Coal - Colombia
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Vedanta Resources Plc - India
- Renaissance Capital - South Africa
- Africa Commodities Group - South Africa
- London Commodity Brokers - England
- The State Trading Corporation of India Ltd
- International Coal Ventures Pvt Ltd - India
- Parry Sugars Refinery, India
- Australian Coal Association
- Trasteel International SA, Italy
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Sindya Power Generating Company Private Ltd
- Savvy Resources Ltd - HongKong
- Economic Council, Georgia
- Chamber of Mines of South Africa
- Central Electricity Authority - India
- MS Steel International - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Maharashtra Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Xindia Steels Limited - India
- McConnell Dowell - Australia
- Billiton Holdings Pty Ltd - Australia
- Indian Oil Corporation Limited
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Australian Commodity Traders Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Thai Mozambique Logistica
- Salva Resources Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Sinarmas Energy and Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Malabar Cements Ltd - India
- Romanian Commodities Exchange
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- GAC Shipping (India) Pvt Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Karaikal Port Pvt Ltd - India
- Star Paper Mills Limited - India
- Parliament of New Zealand
- Meenaskhi Energy Private Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Meralco Power Generation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Grasim Industreis Ltd - India
- Sical Logistics Limited - India
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Kalimantan Lumbung Energi - Indonesia
- Port Waratah Coal Services - Australia
- CIMB Investment Bank - Malaysia
- Timah Investasi Mineral - Indoneisa
- Makarim & Taira - Indonesia
- SN Aboitiz Power Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Bhushan Steel Limited - India
- Ministry of Transport, Egypt
- Interocean Group of Companies - India
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- Anglo American - United Kingdom
- Price Waterhouse Coopers - Russia
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Kumho Petrochemical, South Korea
- Vizag Seaport Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- White Energy Company Limited
- Simpson Spence & Young - Indonesia
- Madhucon Powers Ltd - India
- Altura Mining Limited, Indonesia
- Aboitiz Power Corporation - Philippines
- Mercator Lines Limited - India
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