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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, 02 August 24
COAL MARKET DEVELOPMENTS: FALLING PRICES AMID RECORD-HIGH OUTPUT - WORLD BANK
Coal prices inched up in May (m/m) following an 8 percent decline in 2024Q1. The Australian and South African benchmarks have plummeted more ...
Friday, 26 July 24
FUELEU MARITME IS COMING. IS YOUR CHARTERPARTY READY? - GARD
With less than six months to implementation of FuelEU Maritime in EU and EEA trades, there has been little published advice regarding how to alloca ...
Thursday, 04 July 24
INDIA'S COAL PRODUCTION RISES 14% IN JUNE - PTI
The country’s coal production rose by 14.49% to 84.63 million tonne (MT) in June. The country’s coal output was 73.92 MT in June last f ...
Tuesday, 02 July 24
NTPC CAPTIVE COAL OUTPUT GROWS 15% IN Q1; DESPATCH RISES 17%
State-owned NTPC on Monday reported a 15 per cent year-on-year increase in the production of coal from captives mines to 9.862 metric million tonne ...
Friday, 28 June 24
KOSPO INVITED BIDS FOR 400,000 MT OF MINIMUM 4000 NCV COAL FOR FIVE YEARS
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for total 400,000 MT of Low Calorific Value Coal for 5 years starting from July 2024 until ...
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- Bangladesh Power Developement Board
- Eastern Coal Council - USA
- Bulk Trading Sa - Switzerland
- Deloitte Consulting - India
- Toyota Tsusho Corporation, Japan
- Ministry of Finance - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- SN Aboitiz Power Inc, Philippines
- Port Waratah Coal Services - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jaiprakash Power Ventures ltd
- Independent Power Producers Association of India
- Ceylon Electricity Board - Sri Lanka
- Agrawal Coal Company - India
- Karbindo Abesyapradhi - Indoneisa
- Thiess Contractors Indonesia
- Coalindo Energy - Indonesia
- Australian Commodity Traders Exchange
- Sree Jayajothi Cements Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Videocon Industries ltd - India
- Carbofer General Trading SA - India
- Central Java Power - Indonesia
- Central Electricity Authority - India
- Savvy Resources Ltd - HongKong
- Globalindo Alam Lestari - Indonesia
- Global Green Power PLC Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- SMG Consultants - Indonesia
- Samtan Co., Ltd - South Korea
- PNOC Exploration Corporation - Philippines
- Vizag Seaport Private Limited - India
- Bhatia International Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Romanian Commodities Exchange
- Orica Mining Services - Indonesia
- Australian Coal Association
- Marubeni Corporation - India
- Ind-Barath Power Infra Limited - India
- Electricity Generating Authority of Thailand
- Tamil Nadu electricity Board
- Wood Mackenzie - Singapore
- The Treasury - Australian Government
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- GMR Energy Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Metalloyd Limited - United Kingdom
- Banpu Public Company Limited - Thailand
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Kobexindo Tractors - Indoneisa
- Orica Australia Pty. Ltd.
- Intertek Mineral Services - Indonesia
- Heidelberg Cement - Germany
- Rashtriya Ispat Nigam Limited - India
- Star Paper Mills Limited - India
- OPG Power Generation Pvt Ltd - India
- Grasim Industreis Ltd - India
- Chettinad Cement Corporation Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Bukit Baiduri Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Kohat Cement Company Ltd. - Pakistan
- Ambuja Cements Ltd - India
- Tata Chemicals Ltd - India
- ASAPP Information Group - India
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- IEA Clean Coal Centre - UK
- Sakthi Sugars Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Merrill Lynch Commodities Europe
- Maheswari Brothers Coal Limited - India
- Ministry of Mines - Canada
- Meralco Power Generation, Philippines
- Riau Bara Harum - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Kepco SPC Power Corporation, Philippines
- Oldendorff Carriers - Singapore
- Larsen & Toubro Limited - India
- Aditya Birla Group - India
- CNBM International Corporation - China
- Planning Commission, India
- Lanco Infratech Ltd - India
- McConnell Dowell - Australia
- Indika Energy - Indonesia
- Baramulti Group, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Malabar Cements Ltd - India
- Kumho Petrochemical, South Korea
- Latin American Coal - Colombia
- Global Business Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Siam City Cement - Thailand
- Makarim & Taira - Indonesia
- Bayan Resources Tbk. - Indonesia
- GAC Shipping (India) Pvt Ltd
- Karaikal Port Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Manunggal Multi Energi - Indonesia
- Interocean Group of Companies - India
- Vedanta Resources Plc - India
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- Kideco Jaya Agung - Indonesia
- Holcim Trading Pte Ltd - Singapore
- SMC Global Power, Philippines
- Semirara Mining Corp, Philippines
- Borneo Indobara - Indonesia
- Commonwealth Bank - Australia
- GVK Power & Infra Limited - India
- Minerals Council of Australia
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- The State Trading Corporation of India Ltd
- Power Finance Corporation Ltd., India
- Africa Commodities Group - South Africa
- Ministry of Transport, Egypt
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- The University of Queensland
- IHS Mccloskey Coal Group - USA
- Indian Energy Exchange, India
- Coastal Gujarat Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Kartika Selabumi Mining - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dalmia Cement Bharat India
- LBH Netherlands Bv - Netherlands
- Indonesian Coal Mining Association
- White Energy Company Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- TeaM Sual Corporation - Philippines
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- PTC India Limited - India
- Indian Oil Corporation Limited
- Therma Luzon, Inc, Philippines
- Jindal Steel & Power Ltd - India
- Standard Chartered Bank - UAE
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- Price Waterhouse Coopers - Russia
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- Cigading International Bulk Terminal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- South Luzon Thermal Energy Corporation
- International Coal Ventures Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- Mercator Lines Limited - India
- GN Power Mariveles Coal Plant, Philippines
- European Bulk Services B.V. - Netherlands
- Sojitz Corporation - Japan
- Bharathi Cement Corporation - India
- Petron Corporation, Philippines
- Trasteel International SA, Italy
- Sindya Power Generating Company Private Ltd
- Binh Thuan Hamico - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
- Mintek Dendrill Indonesia
- PowerSource Philippines DevCo
- Semirara Mining and Power Corporation, Philippines
- Goldman Sachs - Singapore
- Economic Council, Georgia
- Parliament of New Zealand
- Georgia Ports Authority, United States
- New Zealand Coal & Carbon
- Kapuas Tunggal Persada - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Sical Logistics Limited - India
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Parry Sugars Refinery, India
- Jorong Barutama Greston.PT - Indonesia
- Chamber of Mines of South Africa
- Madhucon Powers Ltd - India
- Renaissance Capital - South Africa
- Formosa Plastics Group - Taiwan
- Petrochimia International Co. Ltd.- Taiwan
- Edison Trading Spa - Italy
- Singapore Mercantile Exchange
- CIMB Investment Bank - Malaysia
- Electricity Authority, New Zealand
- Simpson Spence & Young - Indonesia
- Anglo American - United Kingdom
- India Bulls Power Limited - India
- Pendopo Energi Batubara - Indonesia
- Energy Development Corp, Philippines
- Eastern Energy - Thailand
- PetroVietnam Power Coal Import and Supply Company
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