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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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Wednesday, 24 November 21
WHY THIS MINING ANALYST IS UPBEAT ON THE IRON ORE PRICE FORECAST - MOTLEY FOOL
In many ways, 2021 can be called the year of the iron ore price. Much of the talk of the ASX town this year has revolved around this key economic m ...
Wednesday, 24 November 21
PRICE OF CHINA’S COAL FUTURE DROPS BY 60% AS NATIONWIDE DAILY OUTPUT REACHES OVER 12 MILLION TONS: NDRC - GLOBAL TIMES
China’s daily coal output has now stabilized after reaching over 12 million tons and the price of coal futures has declined to 800 yuan ($125 ...
Friday, 19 November 21
CHINA: COAL SUPPLIES TO STABILIZE FOR COMING COLD SEASON
China is capable of ensuring stable coal supplies this winter and next spring with the increase in coal production and the rising stockpiles at pow ...
Wednesday, 17 November 21
MARKET INSIGHT - INTERMODAL
It has been another declining week for the dry bulk market and evidently, we are seeing asset values gradually losing momentum as well. Following a ...
Tuesday, 16 November 21
EARNINGS RECOVERY IN INDONESIAN COAL TO CONTINUE THROUGH 2021, BUT SLOW IN 2022 - FITCH RATINGS
The recovery in the operating and financial performance of Indonesian coal miners and coal contractors is likely to slow in 2022, but coal prices s ...
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- Sojitz Corporation - Japan
- Vizag Seaport Private Limited - India
- Ministry of Finance - Indonesia
- Essar Steel Hazira Ltd - India
- Interocean Group of Companies - India
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Indogreen Group - Indonesia
- Trasteel International SA, Italy
- Binh Thuan Hamico - Vietnam
- Edison Trading Spa - Italy
- PTC India Limited - India
- Kumho Petrochemical, South Korea
- Toyota Tsusho Corporation, Japan
- Salva Resources Pvt Ltd - India
- Malabar Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Bhatia International Limited - India
- India Bulls Power Limited - India
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Chettinad Cement Corporation Ltd - India
- International Coal Ventures Pvt Ltd - India
- Tamil Nadu electricity Board
- Thai Mozambique Logistica
- Alfred C Toepfer International GmbH - Germany
- GMR Energy Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- CIMB Investment Bank - Malaysia
- Oldendorff Carriers - Singapore
- Kapuas Tunggal Persada - Indonesia
- New Zealand Coal & Carbon
- SMG Consultants - Indonesia
- Anglo American - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- The State Trading Corporation of India Ltd
- Vedanta Resources Plc - India
- Jaiprakash Power Ventures ltd
- Australian Commodity Traders Exchange
- Krishnapatnam Port Company Ltd. - India
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- GAC Shipping (India) Pvt Ltd
- Mercator Lines Limited - India
- Kartika Selabumi Mining - Indonesia
- Goldman Sachs - Singapore
- Orica Mining Services - Indonesia
- SMC Global Power, Philippines
- Commonwealth Bank - Australia
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Indika Energy - Indonesia
- Borneo Indobara - Indonesia
- Aboitiz Power Corporation - Philippines
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Ministry of Mines - Canada
- Planning Commission, India
- Coalindo Energy - Indonesia
- Sakthi Sugars Limited - India
- TeaM Sual Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Dalmia Cement Bharat India
- Gujarat Sidhee Cement - India
- Tata Chemicals Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- MS Steel International - UAE
- Indian Energy Exchange, India
- Marubeni Corporation - India
- Wood Mackenzie - Singapore
- Timah Investasi Mineral - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Renaissance Capital - South Africa
- Jorong Barutama Greston.PT - Indonesia
- The Treasury - Australian Government
- Wilmar Investment Holdings
- San Jose City I Power Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- Eastern Energy - Thailand
- Savvy Resources Ltd - HongKong
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- Intertek Mineral Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Lanco Infratech Ltd - India
- Romanian Commodities Exchange
- Indo Tambangraya Megah - Indonesia
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Samtan Co., Ltd - South Korea
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Ambuja Cements Ltd - India
- Siam City Cement PLC, Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- IHS Mccloskey Coal Group - USA
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Power Finance Corporation Ltd., India
- Siam City Cement - Thailand
- Africa Commodities Group - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Sindya Power Generating Company Private Ltd
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- Price Waterhouse Coopers - Russia
- Central Java Power - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Sinarmas Energy and Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Agrawal Coal Company - India
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- Australian Coal Association
- Bangladesh Power Developement Board
- OPG Power Generation Pvt Ltd - India
- Sical Logistics Limited - India
- Star Paper Mills Limited - India
- Indonesian Coal Mining Association
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- PNOC Exploration Corporation - Philippines
- Xindia Steels Limited - India
- PowerSource Philippines DevCo
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- The University of Queensland
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Sree Jayajothi Cements Limited - India
- Parliament of New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Banpu Public Company Limited - Thailand
- SN Aboitiz Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- ASAPP Information Group - India
- Maheswari Brothers Coal Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bukit Makmur.PT - Indonesia
- Kepco SPC Power Corporation, Philippines
- Energy Development Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- CNBM International Corporation - China
- Iligan Light & Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- ICICI Bank Limited - India
- Bharathi Cement Corporation - India
- Independent Power Producers Association of India
- Ministry of Transport, Egypt
- Global Green Power PLC Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Electricity Generating Authority of Thailand
- Therma Luzon, Inc, Philippines
- Singapore Mercantile Exchange
- Central Electricity Authority - India
- Medco Energi Mining Internasional
- Global Business Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Port Waratah Coal Services - Australia
- Mjunction Services Limited - India
- Pendopo Energi Batubara - Indonesia
- Rio Tinto Coal - Australia
- Economic Council, Georgia
- Merrill Lynch Commodities Europe
- Petron Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- London Commodity Brokers - England
- PetroVietnam Power Coal Import and Supply Company
- Coastal Gujarat Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Heidelberg Cement - Germany
- Deloitte Consulting - India
- Chamber of Mines of South Africa
- White Energy Company Limited
- Directorate Of Revenue Intelligence - India
- Electricity Authority, New Zealand
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- Aditya Birla Group - India
- Metalloyd Limited - United Kingdom
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