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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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Tuesday, 20 September 22
CHINA COAL OUTPUT UP 8.1 PCT IN AUGUST - XINHUA
China’s raw coal output posted stable expansion in August, official data showed.
The country produced 370 million tonnes of ra ...
Monday, 19 September 22
BUMA AUSTRALIA AWARDED A$400 MILLION CONTRACT EXTENSION BY BMA FOR GOONYELLA PROJECT
Press Release – PT Delta Dunia Makmur Tbk. (the "Company") announced that its subsidiary, PT Bukit Makmur Mandiri Utama ("BUMA ...
Saturday, 17 September 22
CHINA WARNS COAL COMPANIES AGAINST DUAL CONTRACTS, KEEP PRICES STABLE - REUTERS
China’s state economic planner warned coal companies operating at ports in the Bohai Bay region to comply with their long-term contracts to k ...
Saturday, 17 September 22
IS A GLOBAL RECESSION IMMINENT? - WORLD BANK
Since the beginning of the year, a rapid deterioration of growth prospects coupled with rising inflation and tightening financing conditions, has i ...
Saturday, 17 September 22
FITCH RATINGS REVISES GLOBAL METALS & MINING PRICE ASSUMPTIONS
Fitch Ratings has revised its metals and mining price assumptions reflecting evolving economic growth expectations and demand and supply dynamics.
...
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- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Aboitiz Power Corporation - Philippines
- Wilmar Investment Holdings
- PetroVietnam Power Coal Import and Supply Company
- Videocon Industries ltd - India
- Xindia Steels Limited - India
- Coastal Gujarat Power Limited - India
- Eastern Energy - Thailand
- Romanian Commodities Exchange
- Bukit Baiduri Energy - Indonesia
- Makarim & Taira - Indonesia
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Malabar Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Africa Commodities Group - South Africa
- TeaM Sual Corporation - Philippines
- Ministry of Transport, Egypt
- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- Coalindo Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Coal and Oil Company - UAE
- Mintek Dendrill Indonesia
- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Port Waratah Coal Services - Australia
- Dalmia Cement Bharat India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thai Mozambique Logistica
- Bukit Makmur.PT - Indonesia
- Minerals Council of Australia
- IEA Clean Coal Centre - UK
- Sojitz Corporation - Japan
- Bhoruka Overseas - Indonesia
- ICICI Bank Limited - India
- Rashtriya Ispat Nigam Limited - India
- Bhushan Steel Limited - India
- Madhucon Powers Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- London Commodity Brokers - England
- Price Waterhouse Coopers - Russia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhatia International Limited - India
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Cement Manufacturers Association - India
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Meralco Power Generation, Philippines
- Electricity Generating Authority of Thailand
- Georgia Ports Authority, United States
- Siam City Cement PLC, Thailand
- GN Power Mariveles Coal Plant, Philippines
- CIMB Investment Bank - Malaysia
- SMG Consultants - Indonesia
- Ambuja Cements Ltd - India
- Indogreen Group - Indonesia
- Deloitte Consulting - India
- San Jose City I Power Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Kumho Petrochemical, South Korea
- Riau Bara Harum - Indonesia
- Sinarmas Energy and Mining - Indonesia
- MS Steel International - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Latin American Coal - Colombia
- Borneo Indobara - Indonesia
- Binh Thuan Hamico - Vietnam
- ASAPP Information Group - India
- Maharashtra Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Edison Trading Spa - Italy
- OPG Power Generation Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Medco Energi Mining Internasional
- Mercator Lines Limited - India
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- Posco Energy - South Korea
- Maheswari Brothers Coal Limited - India
- Gujarat Sidhee Cement - India
- Altura Mining Limited, Indonesia
- McConnell Dowell - Australia
- Star Paper Mills Limited - India
- Timah Investasi Mineral - Indoneisa
- Kartika Selabumi Mining - Indonesia
- Heidelberg Cement - Germany
- Karaikal Port Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indonesian Coal Mining Association
- Vijayanagar Sugar Pvt Ltd - India
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- GAC Shipping (India) Pvt Ltd
- GVK Power & Infra Limited - India
- Parry Sugars Refinery, India
- Sarangani Energy Corporation, Philippines
- Agrawal Coal Company - India
- IHS Mccloskey Coal Group - USA
- Global Business Power Corporation, Philippines
- Goldman Sachs - Singapore
- SMC Global Power, Philippines
- Manunggal Multi Energi - Indonesia
- Central Electricity Authority - India
- Kalimantan Lumbung Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Australian Commodity Traders Exchange
- Orica Mining Services - Indonesia
- Renaissance Capital - South Africa
- Formosa Plastics Group - Taiwan
- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- New Zealand Coal & Carbon
- Sindya Power Generating Company Private Ltd
- SN Aboitiz Power Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kideco Jaya Agung - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Ministry of Finance - Indonesia
- Chamber of Mines of South Africa
- Metalloyd Limited - United Kingdom
- Jaiprakash Power Ventures ltd
- Semirara Mining Corp, Philippines
- Planning Commission, India
- PTC India Limited - India
- Petron Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Trasteel International SA, Italy
- The University of Queensland
- Vedanta Resources Plc - India
- Neyveli Lignite Corporation Ltd, - India
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- Indian Energy Exchange, India
- AsiaOL BioFuels Corp., Philippines
- GMR Energy Limited - India
- Bayan Resources Tbk. - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Central Java Power - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Commonwealth Bank - Australia
- Mjunction Services Limited - India
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- Indian Oil Corporation Limited
- Independent Power Producers Association of India
- Orica Australia Pty. Ltd.
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Thiess Contractors Indonesia
- Marubeni Corporation - India
- Banpu Public Company Limited - Thailand
- Sical Logistics Limited - India
- Bangladesh Power Developement Board
- Directorate Of Revenue Intelligence - India
- The State Trading Corporation of India Ltd
- Mercuria Energy - Indonesia
- Grasim Industreis Ltd - India
- Lanco Infratech Ltd - India
- Electricity Authority, New Zealand
- Parliament of New Zealand
- Globalindo Alam Lestari - Indonesia
- Interocean Group of Companies - India
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PowerSource Philippines DevCo
- Ministry of Mines - Canada
- Essar Steel Hazira Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- European Bulk Services B.V. - Netherlands
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- India Bulls Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- LBH Netherlands Bv - Netherlands
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Eastern Coal Council - USA
- Therma Luzon, Inc, Philippines
- CNBM International Corporation - China
- Aditya Birla Group - India
- Directorate General of MIneral and Coal - Indonesia
- Tata Chemicals Ltd - India
- Bharathi Cement Corporation - India
- South Luzon Thermal Energy Corporation
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Wood Mackenzie - Singapore
- Leighton Contractors Pty Ltd - Australia
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