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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, 20 October 21
CHINA COAL HITS RECORD HIGH AMID TIGHT SUPPLIES - REUTERS
China coal prices hit a record high on Tuesday buoyed by a widening power crunch and cold weather despite Beijing’s efforts to bolster supply ...
Wednesday, 20 October 21
MARKET INSIGHT - INTERMODAL
IMO 2020, Ballast Water Treatment regulations, Green Recycling, GHG emissions, EEXI, CII, ETS, Fit for 55, Carbon price/levy, the Poseidon Principl ...
Tuesday, 19 October 21
SPONGE IRON SECTOR MIGHT REPORT NEGATIVE GROWTH DUE TO COAL CRISIS: SIMA - PTI
The domestic sponge iron industry might report a negative growth in the ongoing December quarter “if the shortage of coal is allowed to conti ...
Tuesday, 19 October 21
COAL INDIA, THE FALL GUY FOR POWER CRISIS - INDIA EXPRESS
The post-Covid economic recovery has led to a major increase in the demand for power, both in India and globally. In India, coal-based power plants ...
Saturday, 16 October 21
SOLAR INSTALLATION SURGE PUTS INDIA ON TRACK TO CAP COAL-FIRED POWER AS EARLY AS 2024 - IEEFA
Recent increase in solar power installations could push coal to peak sooner than expected
If India keeps installing solar capacity a ...
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- Borneo Indobara - Indonesia
- Siam City Cement PLC, Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Mintek Dendrill Indonesia
- Globalindo Alam Lestari - Indonesia
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercator Lines Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Merrill Lynch Commodities Europe
- Gujarat Mineral Development Corp Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Tata Chemicals Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mjunction Services Limited - India
- Indika Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- CIMB Investment Bank - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Australian Commodity Traders Exchange
- Sarangani Energy Corporation, Philippines
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- The Treasury - Australian Government
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Renaissance Capital - South Africa
- Intertek Mineral Services - Indonesia
- Bulk Trading Sa - Switzerland
- Savvy Resources Ltd - HongKong
- Indian Oil Corporation Limited
- Electricity Generating Authority of Thailand
- Kohat Cement Company Ltd. - Pakistan
- Leighton Contractors Pty Ltd - Australia
- Bangladesh Power Developement Board
- Kideco Jaya Agung - Indonesia
- PNOC Exploration Corporation - Philippines
- McConnell Dowell - Australia
- Karbindo Abesyapradhi - Indoneisa
- Latin American Coal - Colombia
- Metalloyd Limited - United Kingdom
- Gujarat Sidhee Cement - India
- Mercuria Energy - Indonesia
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Commonwealth Bank - Australia
- Sojitz Corporation - Japan
- Malabar Cements Ltd - India
- Sical Logistics Limited - India
- Kapuas Tunggal Persada - Indonesia
- Essar Steel Hazira Ltd - India
- Georgia Ports Authority, United States
- Central Electricity Authority - India
- Bharathi Cement Corporation - India
- Formosa Plastics Group - Taiwan
- Indian Energy Exchange, India
- Romanian Commodities Exchange
- SN Aboitiz Power Inc, Philippines
- Therma Luzon, Inc, Philippines
- Parliament of New Zealand
- Grasim Industreis Ltd - India
- Marubeni Corporation - India
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Sakthi Sugars Limited - India
- Planning Commission, India
- Bhatia International Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Sinarmas Energy and Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Coal and Oil Company - UAE
- Directorate Of Revenue Intelligence - India
- Toyota Tsusho Corporation, Japan
- Altura Mining Limited, Indonesia
- Carbofer General Trading SA - India
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Directorate General of MIneral and Coal - Indonesia
- Edison Trading Spa - Italy
- Uttam Galva Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Bukit Baiduri Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- Agrawal Coal Company - India
- Ind-Barath Power Infra Limited - India
- Coalindo Energy - Indonesia
- Wilmar Investment Holdings
- Chettinad Cement Corporation Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Miang Besar Coal Terminal - Indonesia
- Videocon Industries ltd - India
- Cigading International Bulk Terminal - Indonesia
- Anglo American - United Kingdom
- ASAPP Information Group - India
- Port Waratah Coal Services - Australia
- India Bulls Power Limited - India
- Dalmia Cement Bharat India
- Goldman Sachs - Singapore
- Larsen & Toubro Limited - India
- Indonesian Coal Mining Association
- Jaiprakash Power Ventures ltd
- Oldendorff Carriers - Singapore
- Indogreen Group - Indonesia
- Petron Corporation, Philippines
- ICICI Bank Limited - India
- London Commodity Brokers - England
- Parry Sugars Refinery, India
- MS Steel International - UAE
- International Coal Ventures Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- Salva Resources Pvt Ltd - India
- Ambuja Cements Ltd - India
- Thai Mozambique Logistica
- Tamil Nadu electricity Board
- Binh Thuan Hamico - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Antam Resourcindo - Indonesia
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Aditya Birla Group - India
- Kepco SPC Power Corporation, Philippines
- Medco Energi Mining Internasional
- Energy Development Corp, Philippines
- Interocean Group of Companies - India
- Eastern Energy - Thailand
- Kobexindo Tractors - Indoneisa
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Krishnapatnam Port Company Ltd. - India
- Jorong Barutama Greston.PT - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Energy Link Ltd, New Zealand
- Star Paper Mills Limited - India
- Alfred C Toepfer International GmbH - Germany
- Bhushan Steel Limited - India
- Singapore Mercantile Exchange
- Riau Bara Harum - Indonesia
- Global Green Power PLC Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- PowerSource Philippines DevCo
- LBH Netherlands Bv - Netherlands
- Maheswari Brothers Coal Limited - India
- Pendopo Energi Batubara - Indonesia
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Electricity Authority, New Zealand
- Independent Power Producers Association of India
- Straits Asia Resources Limited - Singapore
- Simpson Spence & Young - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kumho Petrochemical, South Korea
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- White Energy Company Limited
- Siam City Cement - Thailand
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Mines - Canada
- Offshore Bulk Terminal Pte Ltd, Singapore
- Xindia Steels Limited - India
- Africa Commodities Group - South Africa
- Neyveli Lignite Corporation Ltd, - India
- South Luzon Thermal Energy Corporation
- Billiton Holdings Pty Ltd - Australia
- Standard Chartered Bank - UAE
- Price Waterhouse Coopers - Russia
- Timah Investasi Mineral - Indoneisa
- Bukit Makmur.PT - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
- OPG Power Generation Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Iligan Light & Power Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Global Coal Blending Company Limited - Australia
- Economic Council, Georgia
- Heidelberg Cement - Germany
- Orica Australia Pty. Ltd.
- PTC India Limited - India
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- The University of Queensland
- Thiess Contractors Indonesia
- Lanco Infratech Ltd - India
- Power Finance Corporation Ltd., India
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Eastern Coal Council - USA
- Global Business Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Ministry of Transport, Egypt
- Samtan Co., Ltd - South Korea
- Central Java Power - Indonesia
- Chamber of Mines of South Africa
- CNBM International Corporation - China
- Australian Coal Association
- Orica Mining Services - Indonesia
- Karaikal Port Pvt Ltd - India
- Minerals Council of Australia
- Madhucon Powers Ltd - India
- Banpu Public Company Limited - Thailand
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