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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, 04 November 22
CHINA EXPANDS COAL TERM CONTRACTS TO ALL MINES TO STABILIZE MARKET - REUTERS
China has expanded long-term thermal coal supply contracts for 2023 to all coal mines and asked power utilities to source more of their demand thro ...
Thursday, 03 November 22
HANDYSIZE VALUES MOVING UP IN OCTOBER, WHILE LNG VALUES SKYROCKET - VESSELSVALUE
Handysize values have increased this month across most ages, following a period of decline. Values for generic 10 year old Handysizes have moved up ...
Thursday, 03 November 22
EUROPEAN GAS SUPPLY SURPLUS, NOVEMBER HBA DOWN TO US$ 308.2 PER TON - ESDM
European gas supply conditions have a major influence in determining fluctuations in the Reference Coal Price (HBA). The November 2022 HBA recorded ...
Wednesday, 02 November 22
MARKET INSIGHT - INTERMODAL
Only five weeks before western sanctions’ full effect, uncertainty over energy has markets and governments on the edge. What was initially th ...
Tuesday, 01 November 22
CHINA COAL TRADE DISRUPTED BY COVID OUTBREAKS AS WINTER LOOMS - REUTERS
China’s strict COVID-19 policy is constraining coal supplies and pushing up prices, industry officials and traders say, just weeks before the ...
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- PetroVietnam Power Coal Import and Supply Company
- Sinarmas Energy and Mining - Indonesia
- Indian Energy Exchange, India
- Neyveli Lignite Corporation Ltd, - India
- Riau Bara Harum - Indonesia
- Salva Resources Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- Australian Coal Association
- Xindia Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Medco Energi Mining Internasional
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- Star Paper Mills Limited - India
- Coastal Gujarat Power Limited - India
- ICICI Bank Limited - India
- Indo Tambangraya Megah - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- VISA Power Limited - India
- Mintek Dendrill Indonesia
- Energy Link Ltd, New Zealand
- Commonwealth Bank - Australia
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- Standard Chartered Bank - UAE
- ASAPP Information Group - India
- Malabar Cements Ltd - India
- Madhucon Powers Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Maheswari Brothers Coal Limited - India
- Bukit Baiduri Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Australian Commodity Traders Exchange
- Global Coal Blending Company Limited - Australia
- TNB Fuel Sdn Bhd - Malaysia
- London Commodity Brokers - England
- PowerSource Philippines DevCo
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- GVK Power & Infra Limited - India
- Bhushan Steel Limited - India
- Lanco Infratech Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- Carbofer General Trading SA - India
- Ministry of Finance - Indonesia
- Manunggal Multi Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Thiess Contractors Indonesia
- Borneo Indobara - Indonesia
- Marubeni Corporation - India
- PTC India Limited - India
- Pendopo Energi Batubara - Indonesia
- Power Finance Corporation Ltd., India
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- Romanian Commodities Exchange
- Baramulti Group, Indonesia
- Tamil Nadu electricity Board
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Parry Sugars Refinery, India
- Ministry of Transport, Egypt
- Binh Thuan Hamico - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Simpson Spence & Young - Indonesia
- Kumho Petrochemical, South Korea
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Indika Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Anglo American - United Kingdom
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- White Energy Company Limited
- The State Trading Corporation of India Ltd
- Kapuas Tunggal Persada - Indonesia
- Karaikal Port Pvt Ltd - India
- Parliament of New Zealand
- Eastern Coal Council - USA
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Mercuria Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Economic Council, Georgia
- CIMB Investment Bank - Malaysia
- Savvy Resources Ltd - HongKong
- Vijayanagar Sugar Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Goldman Sachs - Singapore
- Cigading International Bulk Terminal - Indonesia
- Global Business Power Corporation, Philippines
- Gujarat Sidhee Cement - India
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- LBH Netherlands Bv - Netherlands
- International Coal Ventures Pvt Ltd - India
- Orica Mining Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Leighton Contractors Pty Ltd - Australia
- Kaltim Prima Coal - Indonesia
- Singapore Mercantile Exchange
- European Bulk Services B.V. - Netherlands
- Bhoruka Overseas - Indonesia
- MS Steel International - UAE
- Minerals Council of Australia
- Edison Trading Spa - Italy
- India Bulls Power Limited - India
- Metalloyd Limited - United Kingdom
- Intertek Mineral Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Billiton Holdings Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- Indogreen Group - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Semirara Mining Corp, Philippines
- Interocean Group of Companies - India
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Green Power PLC Corporation, Philippines
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Energy Development Corp, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Petron Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Planning Commission, India
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Jindal Steel & Power Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- Meralco Power Generation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Iligan Light & Power Inc, Philippines
- Port Waratah Coal Services - Australia
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- Sical Logistics Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- Jaiprakash Power Ventures ltd
- Deloitte Consulting - India
- Samtan Co., Ltd - South Korea
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- Bhatia International Limited - India
- Karbindo Abesyapradhi - Indoneisa
- The University of Queensland
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Siam City Cement - Thailand
- IEA Clean Coal Centre - UK
- Globalindo Alam Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- GMR Energy Limited - India
- Banpu Public Company Limited - Thailand
- Wood Mackenzie - Singapore
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Coalindo Energy - Indonesia
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- Orica Australia Pty. Ltd.
- Coal and Oil Company - UAE
- McConnell Dowell - Australia
- Formosa Plastics Group - Taiwan
- Central Java Power - Indonesia
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- Straits Asia Resources Limited - Singapore
- Timah Investasi Mineral - Indoneisa
- Thai Mozambique Logistica
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Cement Manufacturers Association - India
- Kartika Selabumi Mining - Indonesia
- Agrawal Coal Company - India
- Sindya Power Generating Company Private Ltd
- Ambuja Cements Ltd - India
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