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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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Tuesday, 26 October 21
CHINA'S COAL-RICH SHANXI BEEFS UP COAL PRODUCTION - XINHUA
Major coal producers in north China’s Shanxi Province, a leading coal-producing region of the country, have beefed up production to ensure en ...
Tuesday, 26 October 21
ENERGY CRISIS SHOWS COAL IS AN EXPENSIVE AND UNRELIABLE SOURCE OF ELECTRICITY GENERATION - IEEFA
Any knee-jerk reaction that urges more investment in coal completely misses the point
India is teetering on the brink of joining a growing glo ...
Tuesday, 26 October 21
CHINA TO INVESTIGATE ENERGY INDEX PROVIDERS IN BID TO TAME COAL PRICES - REUTERS
China said on Monday it will investigate energy price index providers as it urged coal industry participants to “strictly” meet contrac ...
Tuesday, 26 October 21
THERE IS PLENTY OF COAL AND GAS IN THE WORLD BUT A VOLATILE MARKET IS NOBODY'S FRIEND - IEEFA
Gas will be winding its way out of the energy system
Gas prices are continuing to surge around the world. The cost of gas is at unpr ...
Tuesday, 26 October 21
AUSTRALIA EXPORTED 51.6 MLN TONNES OF COAL TO INDIA IN FIRST 10 MONTHS, 19% OF ALL AUSTRALIAN COAL EXPORTS; CHINA WAS THE DESTINATION FOR JUST 0.7% - BANCHERO COSTA
2020 proved to be a truly terrible year for global seaborne coal trade. In 2021 things started pretty badly, but we are seeing increasing signs of ...
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- SN Aboitiz Power Inc, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Xindia Steels Limited - India
- Electricity Authority, New Zealand
- Ministry of Mines - Canada
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- London Commodity Brokers - England
- Parliament of New Zealand
- PowerSource Philippines DevCo
- Borneo Indobara - Indonesia
- McConnell Dowell - Australia
- Petron Corporation, Philippines
- Ministry of Finance - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Minerals Council of Australia
- Kideco Jaya Agung - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Manunggal Multi Energi - Indonesia
- Australian Coal Association
- Deloitte Consulting - India
- Eastern Energy - Thailand
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- Toyota Tsusho Corporation, Japan
- Barasentosa Lestari - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Orica Australia Pty. Ltd.
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Star Paper Mills Limited - India
- Africa Commodities Group - South Africa
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Economic Council, Georgia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Sidhee Cement - India
- Coal and Oil Company - UAE
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- Price Waterhouse Coopers - Russia
- Sojitz Corporation - Japan
- Indonesian Coal Mining Association
- IEA Clean Coal Centre - UK
- Electricity Generating Authority of Thailand
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- South Luzon Thermal Energy Corporation
- Planning Commission, India
- SMC Global Power, Philippines
- Dalmia Cement Bharat India
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Romanian Commodities Exchange
- Coastal Gujarat Power Limited - India
- Wood Mackenzie - Singapore
- Goldman Sachs - Singapore
- OPG Power Generation Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Mercuria Energy - Indonesia
- Rio Tinto Coal - Australia
- Asmin Koalindo Tuhup - Indonesia
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Sakthi Sugars Limited - India
- Ministry of Transport, Egypt
- Bukit Makmur.PT - Indonesia
- Bhushan Steel Limited - India
- Riau Bara Harum - Indonesia
- Indika Energy - Indonesia
- Medco Energi Mining Internasional
- Singapore Mercantile Exchange
- Georgia Ports Authority, United States
- Vedanta Resources Plc - India
- Metalloyd Limited - United Kingdom
- Madhucon Powers Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Carbofer General Trading SA - India
- Leighton Contractors Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Indian Oil Corporation Limited
- Siam City Cement PLC, Thailand
- Sarangani Energy Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Baiduri Energy - Indonesia
- Thai Mozambique Logistica
- Kobexindo Tractors - Indoneisa
- Globalindo Alam Lestari - Indonesia
- Interocean Group of Companies - India
- ICICI Bank Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Kapuas Tunggal Persada - Indonesia
- Therma Luzon, Inc, Philippines
- Renaissance Capital - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Tamil Nadu electricity Board
- Samtan Co., Ltd - South Korea
- PetroVietnam Power Coal Import and Supply Company
- Timah Investasi Mineral - Indoneisa
- Karbindo Abesyapradhi - Indoneisa
- Pendopo Energi Batubara - Indonesia
- CNBM International Corporation - China
- Meenaskhi Energy Private Limited - India
- VISA Power Limited - India
- Bhatia International Limited - India
- Central Java Power - Indonesia
- Marubeni Corporation - India
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Aditya Birla Group - India
- Global Green Power PLC Corporation, Philippines
- Cement Manufacturers Association - India
- IHS Mccloskey Coal Group - USA
- Central Electricity Authority - India
- Karaikal Port Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Ambuja Cements Ltd - India
- Kumho Petrochemical, South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Salva Resources Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- International Coal Ventures Pvt Ltd - India
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Jindal Steel & Power Ltd - India
- Sical Logistics Limited - India
- Grasim Industreis Ltd - India
- Latin American Coal - Colombia
- Makarim & Taira - Indonesia
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Chamber of Mines of South Africa
- New Zealand Coal & Carbon
- Malabar Cements Ltd - India
- Eastern Coal Council - USA
- The State Trading Corporation of India Ltd
- Heidelberg Cement - Germany
- Billiton Holdings Pty Ltd - Australia
- PTC India Limited - India
- Binh Thuan Hamico - Vietnam
- Independent Power Producers Association of India
- Commonwealth Bank - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Thiess Contractors Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- The University of Queensland
- Cigading International Bulk Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mintek Dendrill Indonesia
- GAC Shipping (India) Pvt Ltd
- Larsen & Toubro Limited - India
- Indogreen Group - Indonesia
- Intertek Mineral Services - Indonesia
- Standard Chartered Bank - UAE
- Merrill Lynch Commodities Europe
- Siam City Cement - Thailand
- Power Finance Corporation Ltd., India
- Kartika Selabumi Mining - Indonesia
- Coalindo Energy - Indonesia
- San Jose City I Power Corp, Philippines
- The Treasury - Australian Government
- Simpson Spence & Young - Indonesia
- Oldendorff Carriers - Singapore
- Energy Link Ltd, New Zealand
- Energy Development Corp, Philippines
- Lanco Infratech Ltd - India
- Bharathi Cement Corporation - India
- ASAPP Information Group - India
- Tata Chemicals Ltd - India
- India Bulls Power Limited - India
- Wilmar Investment Holdings
- Kohat Cement Company Ltd. - Pakistan
- PNOC Exploration Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Altura Mining Limited, Indonesia
- GMR Energy Limited - India
- TeaM Sual Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Parry Sugars Refinery, India
- Australian Commodity Traders Exchange
- Essar Steel Hazira Ltd - India
- Mjunction Services Limited - India
- Uttam Galva Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Miang Besar Coal Terminal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- CIMB Investment Bank - Malaysia
- Bulk Trading Sa - Switzerland
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aboitiz Power Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Semirara Mining Corp, Philippines
- Baramulti Group, Indonesia
- Posco Energy - South Korea
- Trasteel International SA, Italy
- Meralco Power Generation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- Orica Mining Services - Indonesia
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