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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, 26 November 21
CHINA FINDS COMPLIANCE PROBLEMS IN COAL PRICE INDEX PROBE - REUTERS
China’s state planner on Wednesday said it had discovered some “noncompliant” behaviour among coal price index providers as it an ...
Thursday, 25 November 21
SE ASIA POWER DEMAND TO RISE AS STATE SUPPORT MITIGATES COVID-19 IMPACT - FITCH RATINGS
Electricity demand in south-east Asia is likely to increase in 2021, following slow growth or contraction in 2020, thanks to state support that has ...
Thursday, 25 November 21
FITCH RATINGS INCREASES MOST GLOBAL METALS AND MINING PRICE ASSUMPTIONS - FITCH RATINGS
Fitch Ratings has increased most metals and mining price assumptions, particularly those that benefit from increased longer-term demand due to glob ...
Thursday, 25 November 21
CHINA'S COAL PRICE DROPS IN MID-NOVEMBER AMID GOVERNMENT’S SWEEPING MEASURES - GLOBAL TIMES
China’s coal prices have dropped significantly in mid-November compared with the beginning of the month, with the price of coking coal and co ...
Wednesday, 24 November 21
MARKET INSIGHT - INTERMODAL
Inflation is the word that has dominated the meetings of foreign leaders and finance ministers in recent weeks, as rising energy costs, supply chai ...
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- Coal and Oil Company - UAE
- Kideco Jaya Agung - Indonesia
- Bayan Resources Tbk. - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kaltim Prima Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Electricity Generating Authority of Thailand
- Iligan Light & Power Inc, Philippines
- Chamber of Mines of South Africa
- Mercator Lines Limited - India
- Meralco Power Generation, Philippines
- Videocon Industries ltd - India
- Central Electricity Authority - India
- IEA Clean Coal Centre - UK
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Australian Coal Association
- SN Aboitiz Power Inc, Philippines
- Vedanta Resources Plc - India
- Miang Besar Coal Terminal - Indonesia
- Gujarat Sidhee Cement - India
- TNB Fuel Sdn Bhd - Malaysia
- Thai Mozambique Logistica
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- Holcim Trading Pte Ltd - Singapore
- Formosa Plastics Group - Taiwan
- GVK Power & Infra Limited - India
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- Ceylon Electricity Board - Sri Lanka
- Sakthi Sugars Limited - India
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- LBH Netherlands Bv - Netherlands
- Uttam Galva Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- International Coal Ventures Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aditya Birla Group - India
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Binh Thuan Hamico - Vietnam
- Bukit Makmur.PT - Indonesia
- Africa Commodities Group - South Africa
- Sinarmas Energy and Mining - Indonesia
- Global Business Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wilmar Investment Holdings
- Rashtriya Ispat Nigam Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Krishnapatnam Port Company Ltd. - India
- India Bulls Power Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Thiess Contractors Indonesia
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Economic Council, Georgia
- Port Waratah Coal Services - Australia
- Ministry of Transport, Egypt
- Altura Mining Limited, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Electricity Authority, New Zealand
- Mjunction Services Limited - India
- Indian Energy Exchange, India
- Global Green Power PLC Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Sree Jayajothi Cements Limited - India
- Parliament of New Zealand
- Jaiprakash Power Ventures ltd
- Siam City Cement - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- Planning Commission, India
- Kobexindo Tractors - Indoneisa
- Minerals Council of Australia
- Bahari Cakrawala Sebuku - Indonesia
- Edison Trading Spa - Italy
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- Ind-Barath Power Infra Limited - India
- Jindal Steel & Power Ltd - India
- Banpu Public Company Limited - Thailand
- Energy Development Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Posco Energy - South Korea
- OPG Power Generation Pvt Ltd - India
- Commonwealth Bank - Australia
- CNBM International Corporation - China
- Salva Resources Pvt Ltd - India
- Bangladesh Power Developement Board
- Agrawal Coal Company - India
- Medco Energi Mining Internasional
- Borneo Indobara - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Tata Chemicals Ltd - India
- Sindya Power Generating Company Private Ltd
- Sical Logistics Limited - India
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
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- Sojitz Corporation - Japan
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Baramulti Group, Indonesia
- Bhatia International Limited - India
- Siam City Cement PLC, Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Savvy Resources Ltd - HongKong
- SMG Consultants - Indonesia
- PTC India Limited - India
- Maheswari Brothers Coal Limited - India
- Cigading International Bulk Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Timah Investasi Mineral - Indoneisa
- Coalindo Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Xindia Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Interocean Group of Companies - India
- SMC Global Power, Philippines
- Semirara Mining Corp, Philippines
- Dalmia Cement Bharat India
- Bharathi Cement Corporation - India
- Indian Oil Corporation Limited
- Goldman Sachs - Singapore
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- Riau Bara Harum - Indonesia
- South Luzon Thermal Energy Corporation
- Orica Mining Services - Indonesia
- Ambuja Cements Ltd - India
- Indogreen Group - Indonesia
- Bhoruka Overseas - Indonesia
- Anglo American - United Kingdom
- Kumho Petrochemical, South Korea
- Karbindo Abesyapradhi - Indoneisa
- Meenaskhi Energy Private Limited - India
- Mintek Dendrill Indonesia
- Trasteel International SA, Italy
- PetroVietnam Power Coal Import and Supply Company
- Straits Asia Resources Limited - Singapore
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Petrochimia International Co. Ltd.- Taiwan
- Latin American Coal - Colombia
- Oldendorff Carriers - Singapore
- Independent Power Producers Association of India
- Lanco Infratech Ltd - India
- Heidelberg Cement - Germany
- Eastern Coal Council - USA
- Singapore Mercantile Exchange
- Renaissance Capital - South Africa
- GAC Shipping (India) Pvt Ltd
- Therma Luzon, Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Energy Link Ltd, New Zealand
- Romanian Commodities Exchange
- Mercuria Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Manunggal Multi Energi - Indonesia
- ICICI Bank Limited - India
- Billiton Holdings Pty Ltd - Australia
- PNOC Exploration Corporation - Philippines
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- Barasentosa Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Australian Commodity Traders Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Star Paper Mills Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Central Java Power - Indonesia
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Tamil Nadu electricity Board
- Orica Australia Pty. Ltd.
- Kartika Selabumi Mining - Indonesia
- Wood Mackenzie - Singapore
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Deloitte Consulting - India
- GMR Energy Limited - India
- Makarim & Taira - Indonesia
- Antam Resourcindo - Indonesia
- TeaM Sual Corporation - Philippines
- Indika Energy - Indonesia
- VISA Power Limited - India
- IHS Mccloskey Coal Group - USA
- Vijayanagar Sugar Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Bukit Baiduri Energy - Indonesia
- Malabar Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- London Commodity Brokers - England
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- Asmin Koalindo Tuhup - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bulk Trading Sa - Switzerland
- McConnell Dowell - Australia
- Marubeni Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- PowerSource Philippines DevCo
- Petron Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
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