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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, 22 October 21
CHINA WANTS TO COOL COAL PRICES. SIMILAR MOVES FOR METALS, CRUDE FAILED - REUTERS
China’s latest attempt to lower runaway commodity prices, this time for thermal coal, is likely to follow a familiar pattern of initial succe ...
Friday, 22 October 21
HARD COAL REMAINS AN IMPORTANT FACTOR FOR SECURITY OF SUPPLY - COAL IMPORTERS ASSOCIATION, GERMANY
- Hard coal remains an important factor for security of supply
- Increase of around 35% in hard-coal-fired power generation in the first three ...
Wednesday, 20 October 21
CHINA'S COAL SHORTAGE TO EASE IN COMING MONTHS, INDUSTRY BODY SAYS - REUTERS
China’s coal shortage will likely ease in coming months, with domestic production and imports already showing signs of picking up, a coal ind ...
Wednesday, 20 October 21
CHINA'S RAW COAL OUTPUT DROPS IN SEPTEMBER - XINHUA
China’s raw coal output dropped 0.9 percent year on year to 330 million tonnes last month, data from the National Bureau of Statistics (NBS) ...
Wednesday, 20 October 21
OVER-RELIANCE ON COAL IN OUR POWER MIX HURTING INDIA - LIVEMINT
In spite of the renewables push, coal still accounts for about 50% of India’s installed power capacity. That means a simultaneous demand and ...
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- Australian Coal Association
- Meralco Power Generation, Philippines
- Eastern Coal Council - USA
- Chamber of Mines of South Africa
- Savvy Resources Ltd - HongKong
- Barasentosa Lestari - Indonesia
- GMR Energy Limited - India
- Trasteel International SA, Italy
- McConnell Dowell - Australia
- Heidelberg Cement - Germany
- Jorong Barutama Greston.PT - Indonesia
- Bayan Resources Tbk. - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Electricity Authority, New Zealand
- Medco Energi Mining Internasional
- CNBM International Corporation - China
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Uttam Galva Steels Limited - India
- Merrill Lynch Commodities Europe
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Pipit Mutiara Jaya. PT, Indonesia
- Indonesian Coal Mining Association
- European Bulk Services B.V. - Netherlands
- The Treasury - Australian Government
- Chettinad Cement Corporation Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Orica Mining Services - Indonesia
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Indogreen Group - Indonesia
- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- Pendopo Energi Batubara - Indonesia
- ICICI Bank Limited - India
- Riau Bara Harum - Indonesia
- Thiess Contractors Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Cement Manufacturers Association - India
- SMC Global Power, Philippines
- Bangladesh Power Developement Board
- Commonwealth Bank - Australia
- Cigading International Bulk Terminal - Indonesia
- Coalindo Energy - Indonesia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Coastal Gujarat Power Limited - India
- Toyota Tsusho Corporation, Japan
- Semirara Mining and Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Indian Oil Corporation Limited
- Kalimantan Lumbung Energi - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Minerals Council of Australia
- MS Steel International - UAE
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- Central Electricity Authority - India
- Oldendorff Carriers - Singapore
- Metalloyd Limited - United Kingdom
- Sindya Power Generating Company Private Ltd
- Ministry of Mines - Canada
- Karaikal Port Pvt Ltd - India
- Singapore Mercantile Exchange
- Jindal Steel & Power Ltd - India
- Kartika Selabumi Mining - Indonesia
- OPG Power Generation Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- IHS Mccloskey Coal Group - USA
- Maheswari Brothers Coal Limited - India
- Vizag Seaport Private Limited - India
- Marubeni Corporation - India
- Binh Thuan Hamico - Vietnam
- India Bulls Power Limited - India
- Timah Investasi Mineral - Indoneisa
- TeaM Sual Corporation - Philippines
- Bhushan Steel Limited - India
- Maharashtra Electricity Regulatory Commission - India
- London Commodity Brokers - England
- Manunggal Multi Energi - Indonesia
- Parry Sugars Refinery, India
- IEA Clean Coal Centre - UK
- White Energy Company Limited
- Mercator Lines Limited - India
- Bhoruka Overseas - Indonesia
- Aboitiz Power Corporation - Philippines
- Independent Power Producers Association of India
- Deloitte Consulting - India
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bukit Asam (Persero) Tbk - Indonesia
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Ambuja Cements Ltd - India
- PTC India Limited - India
- Planning Commission, India
- Sarangani Energy Corporation, Philippines
- Tata Chemicals Ltd - India
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- CIMB Investment Bank - Malaysia
- GVK Power & Infra Limited - India
- Tamil Nadu electricity Board
- Simpson Spence & Young - Indonesia
- Sree Jayajothi Cements Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Transport, Egypt
- Borneo Indobara - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Dalmia Cement Bharat India
- Ministry of Finance - Indonesia
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Altura Mining Limited, Indonesia
- Economic Council, Georgia
- PNOC Exploration Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Ceylon Electricity Board - Sri Lanka
- Globalindo Alam Lestari - Indonesia
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Madhucon Powers Ltd - India
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Rio Tinto Coal - Australia
- Leighton Contractors Pty Ltd - Australia
- Bukit Makmur.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Alfred C Toepfer International GmbH - Germany
- Xindia Steels Limited - India
- Banpu Public Company Limited - Thailand
- Directorate Of Revenue Intelligence - India
- Indika Energy - Indonesia
- Siam City Cement - Thailand
- PowerSource Philippines DevCo
- Malabar Cements Ltd - India
- Star Paper Mills Limited - India
- Orica Australia Pty. Ltd.
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- Africa Commodities Group - South Africa
- Kepco SPC Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Antam Resourcindo - Indonesia
- Renaissance Capital - South Africa
- The University of Queensland
- Anglo American - United Kingdom
- Billiton Holdings Pty Ltd - Australia
- Parliament of New Zealand
- Bulk Trading Sa - Switzerland
- Rashtriya Ispat Nigam Limited - India
- Gujarat Sidhee Cement - India
- Electricity Generating Authority of Thailand
- Siam City Cement PLC, Thailand
- Iligan Light & Power Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Thai Mozambique Logistica
- Kumho Petrochemical, South Korea
- Miang Besar Coal Terminal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Larsen & Toubro Limited - India
- Vedanta Resources Plc - India
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- Lanco Infratech Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Bharathi Cement Corporation - India
- Eastern Energy - Thailand
- The State Trading Corporation of India Ltd
- Samtan Co., Ltd - South Korea
- Price Waterhouse Coopers - Russia
- Energy Link Ltd, New Zealand
- Mercuria Energy - Indonesia
- Central Java Power - Indonesia
- Aditya Birla Group - India
- Global Green Power PLC Corporation, Philippines
- Carbofer General Trading SA - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- International Coal Ventures Pvt Ltd - India
- Coal and Oil Company - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Agrawal Coal Company - India
- Therma Luzon, Inc, Philippines
- Makarim & Taira - Indonesia
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- SMG Consultants - Indonesia
- Georgia Ports Authority, United States
- Wilmar Investment Holdings
- Kobexindo Tractors - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- New Zealand Coal & Carbon
- Global Business Power Corporation, Philippines
- Australian Commodity Traders Exchange
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- VISA Power Limited - India
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