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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, 26 July 22
CAP RUSSIA'S OIL PRICE NOW - PROJECT SYNDICATE
Though the price of oil has declined in recent weeks, it is still through the roof, filtering through to gasoline prices, and causing economic and ...
Tuesday, 26 July 22
WILL SOUTH AMERICA’S WINTER DEMAND DRAW LNG CARGOES AWAY FROM EUROPE? - ICIS
South America is now in the middle of its winter demand season. Last year the region increased its share of global LNG imports in winter, with Braz ...
Monday, 25 July 22
GLOBAL 2021 COAL-FIRED ELECTRICITY GENERATION SURGES TO RECORD HIGH - REUTERS
By contrast, mine output was still fractionally below the record set between 2012 and 2014 because older and less efficient coal generators have be ...
Saturday, 23 July 22
THE EU HAS BEEN REDUCING IMPORTS OF RUSSIAN REFINED OIL PRODUCTS SINCE MARCH - BANCHERO COSTA
The European Union could now ban the import and transit of fuel oil from Russia around six months ahead of the planned deadline, an EU official and ...
Saturday, 23 July 22
INDONESIA CONSIDERING SCRAPPING DOMESTIC SALES RULE FOR PALM OIL EXPORTS - REUTERS
Indonesia is considering removing a domestic sales requirement for palm oil exports because high inventories of the vegetable oil have been holding ...
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- Interocean Group of Companies - India
- Indika Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Tata Chemicals Ltd - India
- CNBM International Corporation - China
- Dalmia Cement Bharat India
- Siam City Cement PLC, Thailand
- Australian Coal Association
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Xindia Steels Limited - India
- The Treasury - Australian Government
- Jorong Barutama Greston.PT - Indonesia
- Borneo Indobara - Indonesia
- Global Business Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Sakthi Sugars Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Thiess Contractors Indonesia
- ASAPP Information Group - India
- GAC Shipping (India) Pvt Ltd
- Rio Tinto Coal - Australia
- Parry Sugars Refinery, India
- GMR Energy Limited - India
- Bhushan Steel Limited - India
- Chettinad Cement Corporation Ltd - India
- Globalindo Alam Lestari - Indonesia
- Latin American Coal - Colombia
- Standard Chartered Bank - UAE
- Deloitte Consulting - India
- Coastal Gujarat Power Limited - India
- Therma Luzon, Inc, Philippines
- Tamil Nadu electricity Board
- PNOC Exploration Corporation - Philippines
- Oldendorff Carriers - Singapore
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Australian Commodity Traders Exchange
- Ministry of Transport, Egypt
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- ICICI Bank Limited - India
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- San Jose City I Power Corp, Philippines
- Larsen & Toubro Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Energy Development Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Siam City Cement - Thailand
- Edison Trading Spa - Italy
- Kohat Cement Company Ltd. - Pakistan
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- MS Steel International - UAE
- Vizag Seaport Private Limited - India
- The University of Queensland
- Orica Mining Services - Indonesia
- Gujarat Sidhee Cement - India
- Kepco SPC Power Corporation, Philippines
- New Zealand Coal & Carbon
- Mercator Lines Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Sindya Power Generating Company Private Ltd
- Wood Mackenzie - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Electricity Authority, New Zealand
- GVK Power & Infra Limited - India
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Sarangani Energy Corporation, Philippines
- Attock Cement Pakistan Limited
- Baramulti Group, Indonesia
- Orica Australia Pty. Ltd.
- Videocon Industries ltd - India
- Sinarmas Energy and Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Iligan Light & Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- Aditya Birla Group - India
- Grasim Industreis Ltd - India
- Ministry of Finance - Indonesia
- Altura Mining Limited, Indonesia
- CIMB Investment Bank - Malaysia
- Malabar Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Kumho Petrochemical, South Korea
- Binh Thuan Hamico - Vietnam
- Makarim & Taira - Indonesia
- Coalindo Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Formosa Plastics Group - Taiwan
- Kartika Selabumi Mining - Indonesia
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Simpson Spence & Young - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Ind-Barath Power Infra Limited - India
- Eastern Energy - Thailand
- Antam Resourcindo - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Power Finance Corporation Ltd., India
- Port Waratah Coal Services - Australia
- Georgia Ports Authority, United States
- White Energy Company Limited
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Trasteel International SA, Italy
- Madhucon Powers Ltd - India
- IHS Mccloskey Coal Group - USA
- Salva Resources Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- TeaM Sual Corporation - Philippines
- Africa Commodities Group - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Central Electricity Authority - India
- Goldman Sachs - Singapore
- Indonesian Coal Mining Association
- Kaltim Prima Coal - Indonesia
- Agrawal Coal Company - India
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Bharathi Cement Corporation - India
- Sree Jayajothi Cements Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Manunggal Multi Energi - Indonesia
- VISA Power Limited - India
- Indian Energy Exchange, India
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Romanian Commodities Exchange
- Riau Bara Harum - Indonesia
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- Parliament of New Zealand
- Banpu Public Company Limited - Thailand
- Intertek Mineral Services - Indonesia
- Anglo American - United Kingdom
- London Commodity Brokers - England
- Ministry of Mines - Canada
- Coal and Oil Company - UAE
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Bangladesh Power Developement Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- European Bulk Services B.V. - Netherlands
- India Bulls Power Limited - India
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Renaissance Capital - South Africa
- McConnell Dowell - Australia
- Economic Council, Georgia
- Merrill Lynch Commodities Europe
- Bukit Makmur.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bukit Baiduri Energy - Indonesia
- Commonwealth Bank - Australia
- Planning Commission, India
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- Posco Energy - South Korea
- Kideco Jaya Agung - Indonesia
- Cement Manufacturers Association - India
- Petrochimia International Co. Ltd.- Taiwan
- Samtan Co., Ltd - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bulk Trading Sa - Switzerland
- Carbofer General Trading SA - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Heidelberg Cement - Germany
- PTC India Limited - India
- Central Java Power - Indonesia
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- Medco Energi Mining Internasional
- Savvy Resources Ltd - HongKong
- Billiton Holdings Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Sojitz Corporation - Japan
- Jaiprakash Power Ventures ltd
- Marubeni Corporation - India
- Independent Power Producers Association of India
- SMC Global Power, Philippines
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Uttam Galva Steels Limited - India
- Mintek Dendrill Indonesia
- Karaikal Port Pvt Ltd - India
- Star Paper Mills Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Alfred C Toepfer International GmbH - Germany
- Thai Mozambique Logistica
- Barasentosa Lestari - Indonesia
- IEA Clean Coal Centre - UK
- Essar Steel Hazira Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
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