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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, 23 December 21
COAL DEMAND TO PEAK IN INDIA BY 2030, WILL BACK UP RENEWABLES: NITI REPORT - BUSINESS STANDARD
Coal will remain India’s mainstay energy source and the country will shape global demand this decade, two reports have said a month after the ...
Thursday, 23 December 21
INDONESIA’S 2022 COAL OUTPUT SEEN BETWEEN 637 MLN-664 MLN T- OFFICIAL - REUTERS
Indonesia’s 2022 coal output is estimated at between 637 million to 664 million tonnes based on production plans currently being finalised, s ...
Thursday, 23 December 21
VALE ANNOUNCES THE SALE OF ITS COAL ASSETS
Vale informs that, on this date, it has entered into a binding agreement with Vulcan to sell the Moatize coal mine and the Nacala Logistics Corrido ...
Thursday, 23 December 21
INDIA: CAPTIVE POWER PRODUCERS URGE GOVT TO ENSURE NORMAL COAL SUPPLIES - PTI
A captive power producers’ association has urged the government for 100 per cent normalisation of coal supply to captive power producers whil ...
Thursday, 23 December 21
MARKET INSIGHT - INTERMODAL
As an outstanding year for the dry bulk freight market comes to a close, so does a thriving year for the SnP market which can only be compared to 2 ...
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- Global Business Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Makarim & Taira - Indonesia
- Indo Tambangraya Megah - Indonesia
- CNBM International Corporation - China
- Independent Power Producers Association of India
- Bukit Asam (Persero) Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- PTC India Limited - India
- San Jose City I Power Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Interocean Group of Companies - India
- Formosa Plastics Group - Taiwan
- Orica Australia Pty. Ltd.
- GVK Power & Infra Limited - India
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- The Treasury - Australian Government
- ASAPP Information Group - India
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Vedanta Resources Plc - India
- Iligan Light & Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Lanco Infratech Ltd - India
- Indika Energy - Indonesia
- Marubeni Corporation - India
- Planning Commission, India
- South Luzon Thermal Energy Corporation
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Ceylon Electricity Board - Sri Lanka
- Malabar Cements Ltd - India
- SMC Global Power, Philippines
- Posco Energy - South Korea
- Deloitte Consulting - India
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- TNB Fuel Sdn Bhd - Malaysia
- Kumho Petrochemical, South Korea
- Standard Chartered Bank - UAE
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Renaissance Capital - South Africa
- Vizag Seaport Private Limited - India
- Energy Link Ltd, New Zealand
- IHS Mccloskey Coal Group - USA
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Bharathi Cement Corporation - India
- Straits Asia Resources Limited - Singapore
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- Orica Mining Services - Indonesia
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Sarangani Energy Corporation, Philippines
- Larsen & Toubro Limited - India
- Kartika Selabumi Mining - Indonesia
- Coalindo Energy - Indonesia
- VISA Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Eastern Energy - Thailand
- Baramulti Group, Indonesia
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Rio Tinto Coal - Australia
- Globalindo Alam Lestari - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Edison Trading Spa - Italy
- Star Paper Mills Limited - India
- The University of Queensland
- Antam Resourcindo - Indonesia
- India Bulls Power Limited - India
- Sical Logistics Limited - India
- CIMB Investment Bank - Malaysia
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coal and Oil Company - UAE
- ICICI Bank Limited - India
- Kideco Jaya Agung - Indonesia
- Madhucon Powers Ltd - India
- Pendopo Energi Batubara - Indonesia
- Ministry of Mines - Canada
- GMR Energy Limited - India
- Bhushan Steel Limited - India
- New Zealand Coal & Carbon
- Rashtriya Ispat Nigam Limited - India
- SMG Consultants - Indonesia
- Singapore Mercantile Exchange
- Indian Oil Corporation Limited
- Tata Chemicals Ltd - India
- Grasim Industreis Ltd - India
- Georgia Ports Authority, United States
- Bangladesh Power Developement Board
- Aditya Birla Group - India
- Sojitz Corporation - Japan
- Sree Jayajothi Cements Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Coastal Gujarat Power Limited - India
- PowerSource Philippines DevCo
- Thiess Contractors Indonesia
- Agrawal Coal Company - India
- Parry Sugars Refinery, India
- Global Green Power PLC Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- Latin American Coal - Colombia
- Jorong Barutama Greston.PT - Indonesia
- White Energy Company Limited
- Ministry of Transport, Egypt
- Ind-Barath Power Infra Limited - India
- Attock Cement Pakistan Limited
- Meenaskhi Energy Private Limited - India
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- Central Electricity Authority - India
- Asmin Koalindo Tuhup - Indonesia
- MS Steel International - UAE
- Wilmar Investment Holdings
- Semirara Mining Corp, Philippines
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- Sakthi Sugars Limited - India
- Siam City Cement - Thailand
- The State Trading Corporation of India Ltd
- Australian Coal Association
- Commonwealth Bank - Australia
- Anglo American - United Kingdom
- Eastern Coal Council - USA
- Central Java Power - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Petron Corporation, Philippines
- Romanian Commodities Exchange
- Gujarat Sidhee Cement - India
- Videocon Industries ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Jindal Steel & Power Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Timah Investasi Mineral - Indoneisa
- Indogreen Group - Indonesia
- Barasentosa Lestari - Indonesia
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- Indian Energy Exchange, India
- Economic Council, Georgia
- PetroVietnam Power Coal Import and Supply Company
- Energy Development Corp, Philippines
- Dalmia Cement Bharat India
- Aboitiz Power Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Siam City Cement PLC, Thailand
- Altura Mining Limited, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- European Bulk Services B.V. - Netherlands
- Miang Besar Coal Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- McConnell Dowell - Australia
- Kapuas Tunggal Persada - Indonesia
- Jaiprakash Power Ventures ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Intertek Mineral Services - Indonesia
- Indonesian Coal Mining Association
- Borneo Indobara - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- Mercator Lines Limited - India
- Simpson Spence & Young - Indonesia
- Uttam Galva Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Power Finance Corporation Ltd., India
- Wood Mackenzie - Singapore
- Electricity Authority, New Zealand
- LBH Netherlands Bv - Netherlands
- Semirara Mining and Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Salva Resources Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
- SN Aboitiz Power Inc, Philippines
- Minerals Council of Australia
- Oldendorff Carriers - Singapore
- Africa Commodities Group - South Africa
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