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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, 21 January 22
CHINA'S POWER TRADING TARIFFS TO RISE IN 2022 - FITCH RATINGS
Rising trading volume and higher-than-benchmark tariffs in the 2022 bilateral contracts signed between Chinese power generation companies (gencos) ...
Thursday, 20 January 22
CHINESE COAL JUMPS OVER 6% ON PRE-HOLIDAY SUPPLY WORRY - REUTERS
China’s thermal coal futures soared more than 6% on Wednesday, hitting a level last seen in late November as investors grew concerned over ti ...
Thursday, 20 January 22
VIETNAM: COAL SECTOR SEES POSITIVE PROSPECT IN 2022 - VNA
With many signs of rising demand for coal in various economic sectors in 2022, the Vietnam National Coal – Mineral Industries Group (Vinacomi ...
Wednesday, 19 January 22
MARKET INSIGHT - INTERMODAL
Since the beginning of the year, we have been witnessing the BDI correcting downwards with sizable drops across all segments. Latest similar levels ...
Sunday, 09 January 22
INDONESIA MINISTER SAYS 'EMERGENCY OVER' ON COAL SUPPLY CRUNCH - REUTERS
Indonesia’s power emergency which has triggered a coal export ban is over but the government will still continue to discuss policies in this ...
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- Semirara Mining Corp, Philippines
- Ministry of Mines - Canada
- Bangladesh Power Developement Board
- Global Coal Blending Company Limited - Australia
- Wilmar Investment Holdings
- Ministry of Transport, Egypt
- Oldendorff Carriers - Singapore
- Iligan Light & Power Inc, Philippines
- Indian Oil Corporation Limited
- Power Finance Corporation Ltd., India
- Maheswari Brothers Coal Limited - India
- Salva Resources Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Australian Commodity Traders Exchange
- Asmin Koalindo Tuhup - Indonesia
- Medco Energi Mining Internasional
- Marubeni Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Meralco Power Generation, Philippines
- Kumho Petrochemical, South Korea
- Eastern Coal Council - USA
- Posco Energy - South Korea
- Mintek Dendrill Indonesia
- Central Electricity Authority - India
- Global Green Power PLC Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Essar Steel Hazira Ltd - India
- GMR Energy Limited - India
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
- Cigading International Bulk Terminal - Indonesia
- Deloitte Consulting - India
- Kalimantan Lumbung Energi - Indonesia
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- CIMB Investment Bank - Malaysia
- Coal and Oil Company - UAE
- Makarim & Taira - Indonesia
- Meenaskhi Energy Private Limited - India
- Merrill Lynch Commodities Europe
- Pipit Mutiara Jaya. PT, Indonesia
- Toyota Tsusho Corporation, Japan
- Aboitiz Power Corporation - Philippines
- Riau Bara Harum - Indonesia
- Trasteel International SA, Italy
- Sarangani Energy Corporation, Philippines
- Vizag Seaport Private Limited - India
- India Bulls Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Planning Commission, India
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Gujarat Mineral Development Corp Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Videocon Industries ltd - India
- GVK Power & Infra Limited - India
- Gujarat Sidhee Cement - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Krishnapatnam Port Company Ltd. - India
- ICICI Bank Limited - India
- Bukit Baiduri Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- McConnell Dowell - Australia
- Binh Thuan Hamico - Vietnam
- Tata Chemicals Ltd - India
- Grasim Industreis Ltd - India
- Dalmia Cement Bharat India
- Australian Coal Association
- Electricity Authority, New Zealand
- SN Aboitiz Power Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Agrawal Coal Company - India
- Tamil Nadu electricity Board
- Rashtriya Ispat Nigam Limited - India
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Petron Corporation, Philippines
- Siam City Cement PLC, Thailand
- Sojitz Corporation - Japan
- Commonwealth Bank - Australia
- VISA Power Limited - India
- New Zealand Coal & Carbon
- Straits Asia Resources Limited - Singapore
- The Treasury - Australian Government
- Parry Sugars Refinery, India
- Leighton Contractors Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Standard Chartered Bank - UAE
- Independent Power Producers Association of India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Mercuria Energy - Indonesia
- Uttam Galva Steels Limited - India
- South Luzon Thermal Energy Corporation
- Mjunction Services Limited - India
- Georgia Ports Authority, United States
- OPG Power Generation Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- Siam City Cement - Thailand
- Singapore Mercantile Exchange
- Carbofer General Trading SA - India
- Globalindo Alam Lestari - Indonesia
- San Jose City I Power Corp, Philippines
- Aditya Birla Group - India
- Bhoruka Overseas - Indonesia
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jaiprakash Power Ventures ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Sical Logistics Limited - India
- Interocean Group of Companies - India
- Gujarat Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Orica Mining Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- European Bulk Services B.V. - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kobexindo Tractors - Indoneisa
- Altura Mining Limited, Indonesia
- Electricity Generating Authority of Thailand
- Indo Tambangraya Megah - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Rio Tinto Coal - Australia
- TNB Fuel Sdn Bhd - Malaysia
- GN Power Mariveles Coal Plant, Philippines
- Bayan Resources Tbk. - Indonesia
- Coalindo Energy - Indonesia
- Minerals Council of Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indogreen Group - Indonesia
- Sindya Power Generating Company Private Ltd
- Price Waterhouse Coopers - Russia
- Anglo American - United Kingdom
- TeaM Sual Corporation - Philippines
- Global Business Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- GAC Shipping (India) Pvt Ltd
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- Ministry of Finance - Indonesia
- Kepco SPC Power Corporation, Philippines
- Thiess Contractors Indonesia
- Indika Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- The University of Queensland
- Latin American Coal - Colombia
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- MS Steel International - UAE
- Billiton Holdings Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Jindal Steel & Power Ltd - India
- Indian Energy Exchange, India
- Directorate General of MIneral and Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Madhucon Powers Ltd - India
- PNOC Exploration Corporation - Philippines
- Thai Mozambique Logistica
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Heidelberg Cement - Germany
- Goldman Sachs - Singapore
- ASAPP Information Group - India
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Pendopo Energi Batubara - Indonesia
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- PTC India Limited - India
- Kartika Selabumi Mining - Indonesia
- Economic Council, Georgia
- SMG Consultants - Indonesia
- Directorate Of Revenue Intelligence - India
- Baramulti Group, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bhatia International Limited - India
- Bulk Trading Sa - Switzerland
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Formosa Plastics Group - Taiwan
- Antam Resourcindo - Indonesia
- Sree Jayajothi Cements Limited - India
- Sakthi Sugars Limited - India
- International Coal Ventures Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- London Commodity Brokers - England
- AsiaOL BioFuels Corp., Philippines
- Bhushan Steel Limited - India
- Star Paper Mills Limited - India
- White Energy Company Limited
- Bharathi Cement Corporation - India
- Chamber of Mines of South Africa
- Central Java Power - Indonesia
- Energy Link Ltd, New Zealand
- Cement Manufacturers Association - India
- Kideco Jaya Agung - Indonesia
- Bukit Makmur.PT - Indonesia
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