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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, 07 July 22
COAL INDIA'S PRODUCTION SETS RECORD INCREASE OF 29% YOY AT 36 MT IN Q1FY23 - IIFL SECURITIES
Coal India Limited (CIL) has ended April-June quarter FY’23 capping a historic high of 29% yoy output growth, compared to same quarter FY&rsq ...
Wednesday, 06 July 22
MARKET INSIGHT - INTERMODAL
Following the 3rd Decarbonizing Shipping Forum, held in Hamburg on June 2022, there has been a meaningful resurgence of discussions within the ship ...
Tuesday, 05 July 22
WHY ARE VLSFO PRICES SO HIGH, ESPECIALLY IN SINGAPORE? - STEVE CHRISTY, INTEGR8 FUELS
Tightness in products still trumps talks of recession
Last month we wrote about the fears of recession versus the tightness in product markets ...
Tuesday, 05 July 22
ADANI ENTERPRISES LOWEST BIDDER IN COAL INDIA'S IMPORT TENDER: REPORT - BUSINESS STANDARD
Coal India Ltd floated its first import tender on behalf of power companies, where Adani Enterprises Ltd came out to be the lowest bidder, a report ...
Tuesday, 05 July 22
CHINA POLICY KEY FOR IRON ORE OUTLOOK - ING
China’s covid lockdowns and recessionary risks hit iron ore
Iron ore prices have fallen significantly from their year-to-date high of US$ ...
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- Rio Tinto Coal - Australia
- Bhoruka Overseas - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mjunction Services Limited - India
- Deloitte Consulting - India
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining Corp, Philippines
- Petron Corporation, Philippines
- Mercator Lines Limited - India
- Alfred C Toepfer International GmbH - Germany
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- Borneo Indobara - Indonesia
- Bhushan Steel Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- Aboitiz Power Corporation - Philippines
- Madhucon Powers Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Medco Energi Mining Internasional
- Central Electricity Authority - India
- Attock Cement Pakistan Limited
- Eastern Coal Council - USA
- Economic Council, Georgia
- Sical Logistics Limited - India
- Sinarmas Energy and Mining - Indonesia
- Indogreen Group - Indonesia
- Wilmar Investment Holdings
- Gujarat Mineral Development Corp Ltd - India
- Commonwealth Bank - Australia
- Vedanta Resources Plc - India
- Coastal Gujarat Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Manunggal Multi Energi - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Siam City Cement - Thailand
- Parry Sugars Refinery, India
- Ministry of Mines - Canada
- Directorate General of MIneral and Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Mintek Dendrill Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- Energy Link Ltd, New Zealand
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- Heidelberg Cement - Germany
- Kideco Jaya Agung - Indonesia
- Kartika Selabumi Mining - Indonesia
- London Commodity Brokers - England
- Larsen & Toubro Limited - India
- Coal and Oil Company - UAE
- South Luzon Thermal Energy Corporation
- Sojitz Corporation - Japan
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- OPG Power Generation Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- LBH Netherlands Bv - Netherlands
- Agrawal Coal Company - India
- Sakthi Sugars Limited - India
- SMC Global Power, Philippines
- International Coal Ventures Pvt Ltd - India
- Posco Energy - South Korea
- Power Finance Corporation Ltd., India
- Pendopo Energi Batubara - Indonesia
- Dalmia Cement Bharat India
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- PowerSource Philippines DevCo
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Coal Association
- Indian Oil Corporation Limited
- Samtan Co., Ltd - South Korea
- PNOC Exploration Corporation - Philippines
- ASAPP Information Group - India
- Global Coal Blending Company Limited - Australia
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Kepco SPC Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Parliament of New Zealand
- Australian Commodity Traders Exchange
- Global Business Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Romanian Commodities Exchange
- GVK Power & Infra Limited - India
- Renaissance Capital - South Africa
- Kaltim Prima Coal - Indonesia
- Coalindo Energy - Indonesia
- Essar Steel Hazira Ltd - India
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Antam Resourcindo - Indonesia
- Vizag Seaport Private Limited - India
- CIMB Investment Bank - Malaysia
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Sidhee Cement - India
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- Anglo American - United Kingdom
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Interocean Group of Companies - India
- Singapore Mercantile Exchange
- Kalimantan Lumbung Energi - Indonesia
- Therma Luzon, Inc, Philippines
- The State Trading Corporation of India Ltd
- Goldman Sachs - Singapore
- GAC Shipping (India) Pvt Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- Ind-Barath Power Infra Limited - India
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bulk Trading Sa - Switzerland
- Formosa Plastics Group - Taiwan
- Videocon Industries ltd - India
- Binh Thuan Hamico - Vietnam
- Ministry of Transport, Egypt
- Globalindo Alam Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Eastern Energy - Thailand
- Electricity Generating Authority of Thailand
- Trasteel International SA, Italy
- Timah Investasi Mineral - Indoneisa
- Salva Resources Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Georgia Ports Authority, United States
- Bhatia International Limited - India
- Ceylon Electricity Board - Sri Lanka
- Ministry of Finance - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Xindia Steels Limited - India
- Port Waratah Coal Services - Australia
- Indo Tambangraya Megah - Indonesia
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Marubeni Corporation - India
- Minerals Council of Australia
- Oldendorff Carriers - Singapore
- San Jose City I Power Corp, Philippines
- Metalloyd Limited - United Kingdom
- Makarim & Taira - Indonesia
- Sree Jayajothi Cements Limited - India
- Uttam Galva Steels Limited - India
- Kumho Petrochemical, South Korea
- Baramulti Group, Indonesia
- Grasim Industreis Ltd - India
- Karaikal Port Pvt Ltd - India
- GMR Energy Limited - India
- Edison Trading Spa - Italy
- AsiaOL BioFuels Corp., Philippines
- Bharathi Cement Corporation - India
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- Chettinad Cement Corporation Ltd - India
- Cement Manufacturers Association - India
- IEA Clean Coal Centre - UK
- White Energy Company Limited
- Bukit Baiduri Energy - Indonesia
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Wood Mackenzie - Singapore
- Africa Commodities Group - South Africa
- Central Java Power - Indonesia
- Bukit Makmur.PT - Indonesia
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Latin American Coal - Colombia
- Bangladesh Power Developement Board
- SMG Consultants - Indonesia
- Ambuja Cements Ltd - India
- New Zealand Coal & Carbon
- PTC India Limited - India
- Semirara Mining and Power Corporation, Philippines
- The University of Queensland
- Karbindo Abesyapradhi - Indoneisa
- Jaiprakash Power Ventures ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Intertek Mineral Services - Indonesia
- Indonesian Coal Mining Association
- IHS Mccloskey Coal Group - USA
- Electricity Authority, New Zealand
- TeaM Sual Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Aditya Birla Group - India
- Toyota Tsusho Corporation, Japan
- Maheswari Brothers Coal Limited - India
- Miang Besar Coal Terminal - Indonesia
- Planning Commission, India
- Barasentosa Lestari - Indonesia
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- CNBM International Corporation - China
- Mercuria Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- MS Steel International - UAE
- India Bulls Power Limited - India
- Meralco Power Generation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Thai Mozambique Logistica
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