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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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Monday, 01 November 21
COAL PRICES HAVE FURTHER ROOM TO DROP: TOP ECONOMIC PLANNER - GLOBAL TIMES
China’s top economic planner said coal prices have further room to drop on Friday, as the most traded coal futures dropped to below 1,000 yua ...
Saturday, 30 October 21
CHINA'S COAL PRICES SEE BIGGEST WEEKLY FALL IN MORE THAN 5 YEARS - REUTERS
China’s coal futures prices saw their biggest fall in more than five years after the powerful state planner said there is still room to adjus ...
Saturday, 30 October 21
G-20 LEADERS PREPARE STATEMENT TO STOP FUNDING FOREIGN COAL PLANTS - BLOOMBERG
Leaders of the Group of 20 wealthy economies are preparing to pledge to stop funding foreign coal-fired plants, but are still wrangling over climat ...
Friday, 29 October 21
APAC THERMAL COAL SUPPLY TO REMAIN TIGHT AS WINTER LOOMS - FITCH RATINGS
APAC thermal coal prices have surged, hitting historically high levels. The benchmark Newcastle 6,000kcal/kg grade coal reached USD228/tonne in mid ...
Thursday, 28 October 21
CANADA BAN ON SHIPPING COAL WOULD EQUAL SCRAPPING AS MANY AS 3 MILLION CARS - IEEFA
Canada ban on shipping coal would equal scrapping as many as 3 million cars
Change in Canadian policy could have major implications ...
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- Eastern Coal Council - USA
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Planning Commission, India
- South Luzon Thermal Energy Corporation
- Commonwealth Bank - Australia
- Banpu Public Company Limited - Thailand
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- Orica Australia Pty. Ltd.
- European Bulk Services B.V. - Netherlands
- Latin American Coal - Colombia
- Salva Resources Pvt Ltd - India
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhatia International Limited - India
- Indogreen Group - Indonesia
- Marubeni Corporation - India
- Mjunction Services Limited - India
- Krishnapatnam Port Company Ltd. - India
- Minerals Council of Australia
- Parliament of New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Vedanta Resources Plc - India
- Oldendorff Carriers - Singapore
- Jindal Steel & Power Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- CIMB Investment Bank - Malaysia
- Central Java Power - Indonesia
- Jaiprakash Power Ventures ltd
- Standard Chartered Bank - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Straits Asia Resources Limited - Singapore
- MS Steel International - UAE
- Simpson Spence & Young - Indonesia
- Ambuja Cements Ltd - India
- Electricity Authority, New Zealand
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- Mercator Lines Limited - India
- Sakthi Sugars Limited - India
- IHS Mccloskey Coal Group - USA
- LBH Netherlands Bv - Netherlands
- Bayan Resources Tbk. - Indonesia
- Vizag Seaport Private Limited - India
- Binh Thuan Hamico - Vietnam
- India Bulls Power Limited - India
- Global Coal Blending Company Limited - Australia
- Formosa Plastics Group - Taiwan
- Toyota Tsusho Corporation, Japan
- ASAPP Information Group - India
- Agrawal Coal Company - India
- Indonesian Coal Mining Association
- Metalloyd Limited - United Kingdom
- Makarim & Taira - Indonesia
- PTC India Limited - India
- Energy Link Ltd, New Zealand
- Indo Tambangraya Megah - Indonesia
- London Commodity Brokers - England
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement - Thailand
- Malabar Cements Ltd - India
- Tamil Nadu electricity Board
- Cement Manufacturers Association - India
- Kumho Petrochemical, South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Singapore Mercantile Exchange
- Global Business Power Corporation, Philippines
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Star Paper Mills Limited - India
- Pendopo Energi Batubara - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- SMG Consultants - Indonesia
- Merrill Lynch Commodities Europe
- Ministry of Transport, Egypt
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- Orica Mining Services - Indonesia
- Renaissance Capital - South Africa
- PNOC Exploration Corporation - Philippines
- Central Electricity Authority - India
- Indian Energy Exchange, India
- Directorate General of MIneral and Coal - Indonesia
- Altura Mining Limited, Indonesia
- Sojitz Corporation - Japan
- Kapuas Tunggal Persada - Indonesia
- Kaltim Prima Coal - Indonesia
- Manunggal Multi Energi - Indonesia
- Coalindo Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Semirara Mining and Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- GMR Energy Limited - India
- Australian Commodity Traders Exchange
- New Zealand Coal & Carbon
- Energy Development Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Thai Mozambique Logistica
- Siam City Cement PLC, Thailand
- Electricity Generating Authority of Thailand
- Alfred C Toepfer International GmbH - Germany
- Uttam Galva Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Finance - Indonesia
- Coal and Oil Company - UAE
- Sree Jayajothi Cements Limited - India
- Economic Council, Georgia
- Timah Investasi Mineral - Indoneisa
- Kideco Jaya Agung - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Port Waratah Coal Services - Australia
- Aditya Birla Group - India
- Sarangani Energy Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Romanian Commodities Exchange
- Price Waterhouse Coopers - Russia
- The University of Queensland
- Rashtriya Ispat Nigam Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Bharathi Cement Corporation - India
- Posco Energy - South Korea
- Barasentosa Lestari - Indonesia
- Petron Corporation, Philippines
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- The Treasury - Australian Government
- Holcim Trading Pte Ltd - Singapore
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- Meenaskhi Energy Private Limited - India
- Independent Power Producers Association of India
- Deloitte Consulting - India
- Interocean Group of Companies - India
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Samtan Co., Ltd - South Korea
- White Energy Company Limited
- Antam Resourcindo - Indonesia
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Meralco Power Generation, Philippines
- Essar Steel Hazira Ltd - India
- Sical Logistics Limited - India
- Gujarat Sidhee Cement - India
- GVK Power & Infra Limited - India
- Kepco SPC Power Corporation, Philippines
- PowerSource Philippines DevCo
- SN Aboitiz Power Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Wood Mackenzie - Singapore
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- Larsen & Toubro Limited - India
- Bhushan Steel Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Riau Bara Harum - Indonesia
- Tata Chemicals Ltd - India
- Global Green Power PLC Corporation, Philippines
- Georgia Ports Authority, United States
- San Jose City I Power Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Anglo American - United Kingdom
- Videocon Industries ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Thiess Contractors Indonesia
- IEA Clean Coal Centre - UK
- Coastal Gujarat Power Limited - India
- Goldman Sachs - Singapore
- Kartika Selabumi Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- TeaM Sual Corporation - Philippines
- Rio Tinto Coal - Australia
- Heidelberg Cement - Germany
- Dalmia Cement Bharat India
- Karaikal Port Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Mintek Dendrill Indonesia
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- Bank of Tokyo Mitsubishi UFJ Ltd
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- VISA Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- ICICI Bank Limited - India
- Ind-Barath Power Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Maheswari Brothers Coal Limited - India
- Attock Cement Pakistan Limited
- CNBM International Corporation - China
- Baramulti Group, Indonesia
- Aboitiz Power Corporation - Philippines
- Bangladesh Power Developement Board
- Africa Commodities Group - South Africa
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