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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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Saturday, 11 June 22
AIMTEK INTERNATIONAL CONFERENCE AND AWARDS
Press Release: The prestigious AIMTEK International Conference and Awards concluded successfully on June 7th, 2022 at Radisson Blu, Yas Island Abu ...
Thursday, 26 May 22
MARKET INSIGHT - INTERMODAL
The newbuilding market activity has been significantly positive from a dry bulk owner perspective during the first half of 2022. Indeed, the contra ...
Wednesday, 18 May 22
INDONESIAN COAL PRICE REFERENCE DROPPED 4.42% IN MAY
COALspot.com: Indonesian Coal Price Reference for May delivery drops 4.42 per cent month on month.
The Indonesian Coal Price Referen ...
Thursday, 12 May 22
MARKET INSIGHT - INTERMODAL
Almost through half of the year, the overall shipping market continues to show signs of healthiness, after plenty of festivities and holidays that ...
Wednesday, 27 April 22
EUROPEAN UNION'S LNG IMPORTS - BANCHERO COSTA
In 2021, the European Union (27) was the third largest seaborne importer of LNG in the world, with a 15.8% share.
It followed Mainla ...
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- Orica Australia Pty. Ltd.
- Banpu Public Company Limited - Thailand
- Marubeni Corporation - India
- Bukit Baiduri Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- PowerSource Philippines DevCo
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Eastern Coal Council - USA
- Chamber of Mines of South Africa
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Thiess Contractors Indonesia
- Rashtriya Ispat Nigam Limited - India
- San Jose City I Power Corp, Philippines
- Ministry of Mines - Canada
- Agrawal Coal Company - India
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Bukit Asam (Persero) Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
- Kartika Selabumi Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Sindya Power Generating Company Private Ltd
- Thai Mozambique Logistica
- Sojitz Corporation - Japan
- Port Waratah Coal Services - Australia
- Attock Cement Pakistan Limited
- Sarangani Energy Corporation, Philippines
- Altura Mining Limited, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- European Bulk Services B.V. - Netherlands
- Jaiprakash Power Ventures ltd
- Minerals Council of Australia
- Bahari Cakrawala Sebuku - Indonesia
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- OPG Power Generation Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Mercator Lines Limited - India
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- Baramulti Group, Indonesia
- Coastal Gujarat Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Kumho Petrochemical, South Korea
- Vijayanagar Sugar Pvt Ltd - India
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Vizag Seaport Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Australian Commodity Traders Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Energy - Thailand
- Mintek Dendrill Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Antam Resourcindo - Indonesia
- Bangladesh Power Developement Board
- Oldendorff Carriers - Singapore
- Star Paper Mills Limited - India
- Cement Manufacturers Association - India
- CNBM International Corporation - China
- Africa Commodities Group - South Africa
- Ceylon Electricity Board - Sri Lanka
- Semirara Mining Corp, Philippines
- India Bulls Power Limited - India
- Karaikal Port Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Commonwealth Bank - Australia
- Renaissance Capital - South Africa
- Samtan Co., Ltd - South Korea
- Planning Commission, India
- Ambuja Cements Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- International Coal Ventures Pvt Ltd - India
- SMC Global Power, Philippines
- Global Coal Blending Company Limited - Australia
- GAC Shipping (India) Pvt Ltd
- Malabar Cements Ltd - India
- Barasentosa Lestari - Indonesia
- Videocon Industries ltd - India
- Parliament of New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Romanian Commodities Exchange
- Mjunction Services Limited - India
- Aboitiz Power Corporation - Philippines
- LBH Netherlands Bv - Netherlands
- Globalindo Alam Lestari - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Dalmia Cement Bharat India
- Asmin Koalindo Tuhup - Indonesia
- Indonesian Coal Mining Association
- MS Steel International - UAE
- Indian Oil Corporation Limited
- McConnell Dowell - Australia
- Timah Investasi Mineral - Indoneisa
- Edison Trading Spa - Italy
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- Jorong Barutama Greston.PT - Indonesia
- Kepco SPC Power Corporation, Philippines
- Indika Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Madhucon Powers Ltd - India
- GMR Energy Limited - India
- Krishnapatnam Port Company Ltd. - India
- Sinarmas Energy and Mining - Indonesia
- Gujarat Sidhee Cement - India
- Indogreen Group - Indonesia
- Electricity Authority, New Zealand
- SMG Consultants - Indonesia
- Makarim & Taira - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Essar Steel Hazira Ltd - India
- Bhushan Steel Limited - India
- Leighton Contractors Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- The University of Queensland
- Posco Energy - South Korea
- Merrill Lynch Commodities Europe
- The State Trading Corporation of India Ltd
- Neyveli Lignite Corporation Ltd, - India
- Chettinad Cement Corporation Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Makmur.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- Bhatia International Limited - India
- Carbofer General Trading SA - India
- Miang Besar Coal Terminal - Indonesia
- London Commodity Brokers - England
- ASAPP Information Group - India
- Kalimantan Lumbung Energi - Indonesia
- Singapore Mercantile Exchange
- Wilmar Investment Holdings
- Jindal Steel & Power Ltd - India
- Trasteel International SA, Italy
- Georgia Ports Authority, United States
- Tamil Nadu electricity Board
- Latin American Coal - Colombia
- Pendopo Energi Batubara - Indonesia
- Therma Luzon, Inc, Philippines
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- VISA Power Limited - India
- Central Java Power - Indonesia
- Directorate Of Revenue Intelligence - India
- Sical Logistics Limited - India
- Electricity Generating Authority of Thailand
- Bulk Trading Sa - Switzerland
- Holcim Trading Pte Ltd - Singapore
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Borneo Indobara - Indonesia
- Central Electricity Authority - India
- Anglo American - United Kingdom
- White Energy Company Limited
- Cigading International Bulk Terminal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Interocean Group of Companies - India
- Gujarat Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Savvy Resources Ltd - HongKong
- Global Green Power PLC Corporation, Philippines
- Power Finance Corporation Ltd., India
- Tata Chemicals Ltd - India
- Grasim Industreis Ltd - India
- Mercuria Energy - Indonesia
- Deloitte Consulting - India
- Iligan Light & Power Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Price Waterhouse Coopers - Russia
- The Treasury - Australian Government
- Binh Thuan Hamico - Vietnam
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- Bhoruka Overseas - Indonesia
- Kobexindo Tractors - Indoneisa
- Siam City Cement - Thailand
- SN Aboitiz Power Inc, Philippines
- PTC India Limited - India
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- Aditya Birla Group - India
- Parry Sugars Refinery, India
- Directorate General of MIneral and Coal - Indonesia
- Heidelberg Cement - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Riau Bara Harum - Indonesia
- Billiton Holdings Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Goldman Sachs - Singapore
- Economic Council, Georgia
- Standard Chartered Bank - UAE
- Simpson Spence & Young - Indonesia
- Intertek Mineral Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Petrochimia International Co. Ltd.- Taiwan
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