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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, 06 October 21
EUROPEAN COAL FUTURES CLIMB TO 13-YEAR PEAK - REUTERS
European coal futures rose to a 13-year high and physical thermal coal prices were at record highs as rallying gas prices and strong Asian demand f ...
Tuesday, 05 October 21
CAPESIZE MARKET WAS IN A STEEP CLIMB FOR MOST OF THIS WEEK - BALTIC EXCHANGE
Capesize
The Capesize market was in a steep climb for most of this week as it reached a pinnacle of $74,786 Wednesday before stalling, regather ...
Wednesday, 29 September 21
THE WRITING IS ON THE WALL: AUSTRALIA’S COAL ERA IS OVER - YAHOO!FINANCE
As the fringe of Australian politics strives to pump up the coal industry, facts show that coal production has started its long run decline.
&n ...
Wednesday, 29 September 21
SURGING COAL PRICES SPLIT ASIAN BUYERS INTO RICH AND POOR - REUTERS
As seaborne coal in Asia trades at, or near, record highs, there are early signs of demand destruction, especially among price-sensitive buyers suc ...
Wednesday, 29 September 21
MARKET INSIGHT - INTERMODAL
Tanker Asset values have surprised to the upside, despite the downward pressure on the freight market. Tanker rates have been hovering close to the ...
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- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
- Timah Investasi Mineral - Indoneisa
- Malabar Cements Ltd - India
- Larsen & Toubro Limited - India
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- Eastern Energy - Thailand
- Mjunction Services Limited - India
- Anglo American - United Kingdom
- Australian Commodity Traders Exchange
- Manunggal Multi Energi - Indonesia
- Coal and Oil Company - UAE
- European Bulk Services B.V. - Netherlands
- Vijayanagar Sugar Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- PNOC Exploration Corporation - Philippines
- Jindal Steel & Power Ltd - India
- PTC India Limited - India
- Price Waterhouse Coopers - Russia
- Billiton Holdings Pty Ltd - Australia
- Energy Development Corp, Philippines
- Sakthi Sugars Limited - India
- Simpson Spence & Young - Indonesia
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Makarim & Taira - Indonesia
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Madhucon Powers Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- ASAPP Information Group - India
- The Treasury - Australian Government
- GAC Shipping (India) Pvt Ltd
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Standard Chartered Bank - UAE
- Thai Mozambique Logistica
- Ministry of Transport, Egypt
- PowerSource Philippines DevCo
- Kohat Cement Company Ltd. - Pakistan
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Sical Logistics Limited - India
- Toyota Tsusho Corporation, Japan
- Maheswari Brothers Coal Limited - India
- Kapuas Tunggal Persada - Indonesia
- CIMB Investment Bank - Malaysia
- Indogreen Group - Indonesia
- Iligan Light & Power Inc, Philippines
- Lanco Infratech Ltd - India
- Bayan Resources Tbk. - Indonesia
- Electricity Authority, New Zealand
- LBH Netherlands Bv - Netherlands
- Indo Tambangraya Megah - Indonesia
- Global Business Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Minerals Council of Australia
- Thiess Contractors Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Sarangani Energy Corporation, Philippines
- Ambuja Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Georgia Ports Authority, United States
- Trasteel International SA, Italy
- Latin American Coal - Colombia
- Bhatia International Limited - India
- South Luzon Thermal Energy Corporation
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Bukit Baiduri Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Heidelberg Cement - Germany
- Formosa Plastics Group - Taiwan
- VISA Power Limited - India
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Chamber of Mines of South Africa
- Merrill Lynch Commodities Europe
- Rashtriya Ispat Nigam Limited - India
- Parliament of New Zealand
- Videocon Industries ltd - India
- Indian Oil Corporation Limited
- Pipit Mutiara Jaya. PT, Indonesia
- McConnell Dowell - Australia
- Sojitz Corporation - Japan
- Deloitte Consulting - India
- Aboitiz Power Corporation - Philippines
- Borneo Indobara - Indonesia
- Riau Bara Harum - Indonesia
- Central Java Power - Indonesia
- Planning Commission, India
- Karaikal Port Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Commonwealth Bank - Australia
- Marubeni Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- Pendopo Energi Batubara - Indonesia
- International Coal Ventures Pvt Ltd - India
- Parry Sugars Refinery, India
- Cement Manufacturers Association - India
- Semirara Mining Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Petron Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Eastern Coal Council - USA
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- TeaM Sual Corporation - Philippines
- Energy Link Ltd, New Zealand
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Mercator Lines Limited - India
- Australian Coal Association
- Ministry of Finance - Indonesia
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Electricity Generating Authority of Thailand
- Wood Mackenzie - Singapore
- India Bulls Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Rio Tinto Coal - Australia
- OPG Power Generation Pvt Ltd - India
- Wilmar Investment Holdings
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- Independent Power Producers Association of India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- Vizag Seaport Private Limited - India
- Ministry of Mines - Canada
- Bangladesh Power Developement Board
- Star Paper Mills Limited - India
- Goldman Sachs - Singapore
- Africa Commodities Group - South Africa
- London Commodity Brokers - England
- Maharashtra Electricity Regulatory Commission - India
- ICICI Bank Limited - India
- Oldendorff Carriers - Singapore
- Interocean Group of Companies - India
- Mintek Dendrill Indonesia
- IHS Mccloskey Coal Group - USA
- Central Electricity Authority - India
- Savvy Resources Ltd - HongKong
- Attock Cement Pakistan Limited
- Banpu Public Company Limited - Thailand
- PetroVietnam Power Coal Import and Supply Company
- Singapore Mercantile Exchange
- Kumho Petrochemical, South Korea
- Semirara Mining and Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- SMC Global Power, Philippines
- The State Trading Corporation of India Ltd
- Indonesian Coal Mining Association
- Sindya Power Generating Company Private Ltd
- Kobexindo Tractors - Indoneisa
- Dalmia Cement Bharat India
- The University of Queensland
- Power Finance Corporation Ltd., India
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement PLC, Thailand
- CNBM International Corporation - China
- Petrochimia International Co. Ltd.- Taiwan
- Vedanta Resources Plc - India
- Economic Council, Georgia
- Krishnapatnam Port Company Ltd. - India
- Therma Luzon, Inc, Philippines
- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
- Holcim Trading Pte Ltd - Singapore
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Orica Mining Services - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- GMR Energy Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Barasentosa Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Global Green Power PLC Corporation, Philippines
- Uttam Galva Steels Limited - India
- SMG Consultants - Indonesia
- White Energy Company Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Gujarat Sidhee Cement - India
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Bahari Cakrawala Sebuku - Indonesia
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