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Thursday, 13 January 11
DRY BULK RATES HIT NEW MULTI-MONTH LOWS ON AUSTRALIAS FLOODS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 Floods in Australia’s Queensland has seriously disrupted coal shipments and together with a flood of vessels has pushed freight rates for dry bulk carriers to new multi-month lows. As a result, the Baltic Dry Index fell further yesterday to just 1,453 points, losing 1.82% on the day, while the suffering Capesize segment retreated by a further 4.77%.
The BDI has now recorded 21 straight losing sessions, losing almost 34% of its value. According to calculations from John Cotzias, head of N.Cotzias Shipping Group, in 58 sessions spanning at just less of three months, there have been only 10 days, during which the index was positive.
“The Cape index is counting 12 falling days and has overall lost in this period close to 40% of its volume. BDI is currently below levels of 5 Feb 2009 when the index was rising” said Mr. Cotzias. The market hasn’t seen such low levels since November of 2002, except of course the October 2008 market crash.
In a separate analysis, BIMCO’s shipping analyst Peter Sand said that all in all – the worst flooding in Queensland for more than 50 years “is not only bad for Australia, it's also bad for shipping as volumes on coal and iron ore go down considerably - and more vessels are free on the market putting pressure on the spot market for vessels. Average Capesize time charter rate that has been falling since end of November is now down at USD 11,266 per day trading lower every day” said Sand. He went on to state that iron ore which is exported out of West Australia is not directly affected yet even though that area has received much rain also. Lower steel production and thus also lower seaborne volumes of the two key dry bulk commodities is set to impact the market negatively over the next months. Australia is the world's largest overall coal exporter ,No. 2 in thermal coal exports after Indonesia but second to none in coking coal exports. Australia is key global coking coal supplier accounting for 60% of global seaborne exports. Within thermal coal Australia accounts for 20%. Thermal coal is used for power generation and heating, while coking coal is used in the production steel. As we have already seen, coal customers will try to find other ways to satisfy their demand for thermal coal but the real trouble is coking coal - as it is very hard to get from elsewhere. Shortage of Australian coking coal means that the worlds steel producers, primarily located in Asia, can be forced to cut the production of steel and with it also the demand for iron ore. ”A slowdown in steel production and iron ore demand is toxic to dry bulk shipping in general and for the larger vessels, Capesize and Panamax in particular. The iron ore contract prices for Q1-2011 have already been set at 7% higher than the previous quarter - but spot iron ore prices can still fluctuate and will move south on lower demand. China imports 40-50% of its coking coal from Australia. Japan, the world’s largest coking coal importer is heavily impacted also. The flooding may see contract prices for coking coal hiking significantly due to spot prices going sharply up as a result of the tight market. A part of the mechanism behind the contract prices is the spot price development. This may result in coking coal prices moving from USD 225 per tonnes in Q1-2011 up to USD 270-300 per tonnes according to several commodity analysts.
When the mines call force majeure - the steel mills must go to the spot market for coking coal - at a much higher price than the contract price for this important steel production ingredient - if they can get it at all. Alternative sources of coking coal are the US and Canada but reports are that the tight market has impacted prices also there, leading to higher commodity prices. So if coking coal spot goes up on tight supply - iron ore spot price can go down as a consequence of lower demand. A price hike in coking coal will increase the
production cost for steel - in a market already running on low margins” said BIMCO’s analyst.
So where will it go from here? “It is a string of events that cause shipping demand out of Australia to go down. Moreover the market place is plentifully supplied with tonnage so the fact that some of the commodities will be supplied from sources further away will only have very limited impact on the market. The first quarter of 2011 - do not hold great prospects for the dry bulk market - mainly because the oversupply of vessels is getting too heavy even for the "normal" inefficiencies of the market to make impact on the freight rates. The Australian situation is set to affect the market for at least a of couple months - meaning that the situation outlined above will stay a drag on the overall market and freight rates for some time” concluded Sand.
Talking about the potential overcapacity, Cotzias said that there is a total of over 3,500 dry bulk carriers on order pending until 2014 of a total of 250 million tons dwt. “These orders are split chronologically as follows: 1,854 ships are due for 2011 making up a total of 128 mil dwt, 1,106 ships due in 2012 of 87 mil dwt and 360 ships of 30 mil dwt due for 2013-2014. In total there is a massive orderbook only on the Bulkers section and we should not understate the fact that 2011 faces us with more than 55% of the total orderbook and that we should also include in this 114 orders of 4mil dwt that are “carried forward” from 2010”.
Source: Nikos Roussanoglou, Hellenic Shipping
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Tuesday, 22 February 11
SUPRAMAX MARKET IS IMPROVING IN THE PACIFIC
BRS - A 10% rise in the BDI this week, mostly on the back of Panamax rates and improvements in the Supramax market in the Pacific. For the Capes, ra ...
Monday, 21 February 11
CHURCHILL MINING RECEIVES SIGNIFICANT INTEREST, PROPOSALS TO DEVELOP EAST KUTAI COAL PROJECT - PROACTIVE INVESTORS
Proactive Investors reported that, Churchill Mining has received a number of specific proposals to fund and develop its massive East Kutai coa ...
Monday, 21 February 11
ABOLISH 5% DUTY ON COAL IMPORTS: SHINDE
Indian Express reported that, with acute coal shortage of domestic coal threatening to destabilise its power generation plans, the power ministry ha ...
Saturday, 19 February 11
THE FREIGHT MARKET EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com - The market was quite firm this week with freight rates in South east asia and India/Feast almost up by 30 pct.
However towards end ...
Thursday, 17 February 11
COAL-GEN EUROPE 2011 REAFFIRMS THE IMPORTANCE OF COAL
Press Release: The third COAL-GEN Europe conference and exhibition, kicked off on Tuesday 15 February, with leading experts, professionals and compa ...
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- Savvy Resources Ltd - HongKong
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Economic Council, Georgia
- Heidelberg Cement - Germany
- Bulk Trading Sa - Switzerland
- Gujarat Electricity Regulatory Commission - India
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
- Sarangani Energy Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Petron Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Minerals Council of Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Edison Trading Spa - Italy
- Jindal Steel & Power Ltd - India
- Star Paper Mills Limited - India
- Kalimantan Lumbung Energi - Indonesia
- MS Steel International - UAE
- Riau Bara Harum - Indonesia
- Banpu Public Company Limited - Thailand
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Jaiprakash Power Ventures ltd
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- Marubeni Corporation - India
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- The University of Queensland
- Simpson Spence & Young - Indonesia
- Energy Development Corp, Philippines
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Mjunction Services Limited - India
- Deloitte Consulting - India
- Sical Logistics Limited - India
- Formosa Plastics Group - Taiwan
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- Thai Mozambique Logistica
- Indonesian Coal Mining Association
- Latin American Coal - Colombia
- Singapore Mercantile Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- OPG Power Generation Pvt Ltd - India
- SMG Consultants - Indonesia
- Wood Mackenzie - Singapore
- Samtan Co., Ltd - South Korea
- Kaltim Prima Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- Aboitiz Power Corporation - Philippines
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- Siam City Cement PLC, Thailand
- Ministry of Mines - Canada
- London Commodity Brokers - England
- Posco Energy - South Korea
- PowerSource Philippines DevCo
- European Bulk Services B.V. - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Aditya Birla Group - India
- Sakthi Sugars Limited - India
- Borneo Indobara - Indonesia
- Wilmar Investment Holdings
- PTC India Limited - India
- Rashtriya Ispat Nigam Limited - India
- CIMB Investment Bank - Malaysia
- Port Waratah Coal Services - Australia
- Binh Thuan Hamico - Vietnam
- Ambuja Cements Ltd - India
- ICICI Bank Limited - India
- Goldman Sachs - Singapore
- Bhoruka Overseas - Indonesia
- Lanco Infratech Ltd - India
- Intertek Mineral Services - Indonesia
- Essar Steel Hazira Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Ministry of Finance - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Independent Power Producers Association of India
- Medco Energi Mining Internasional
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Barasentosa Lestari - Indonesia
- Merrill Lynch Commodities Europe
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- San Jose City I Power Corp, Philippines
- Kideco Jaya Agung - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Holcim Trading Pte Ltd - Singapore
- Interocean Group of Companies - India
- Maharashtra Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- Anglo American - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- Meralco Power Generation, Philippines
- Global Business Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Karaikal Port Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Electricity Authority, New Zealand
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Pendopo Energi Batubara - Indonesia
- Straits Asia Resources Limited - Singapore
- Jorong Barutama Greston.PT - Indonesia
- SMC Global Power, Philippines
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- Global Coal Blending Company Limited - Australia
- Gujarat Sidhee Cement - India
- India Bulls Power Limited - India
- IEA Clean Coal Centre - UK
- AsiaOL BioFuels Corp., Philippines
- SN Aboitiz Power Inc, Philippines
- Indian Energy Exchange, India
- Antam Resourcindo - Indonesia
- Kepco SPC Power Corporation, Philippines
- Dalmia Cement Bharat India
- Sinarmas Energy and Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Metalloyd Limited - United Kingdom
- Grasim Industreis Ltd - India
- Renaissance Capital - South Africa
- GN Power Mariveles Coal Plant, Philippines
- Kobexindo Tractors - Indoneisa
- VISA Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Price Waterhouse Coopers - Russia
- Coalindo Energy - Indonesia
- Australian Coal Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indika Energy - Indonesia
- Parliament of New Zealand
- Directorate Of Revenue Intelligence - India
- Madhucon Powers Ltd - India
- Cement Manufacturers Association - India
- Trasteel International SA, Italy
- PNOC Exploration Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Maheswari Brothers Coal Limited - India
- Toyota Tsusho Corporation, Japan
- Mercuria Energy - Indonesia
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Planning Commission, India
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- Central Electricity Authority - India
- Larsen & Toubro Limited - India
- Makarim & Taira - Indonesia
- Mercator Lines Limited - India
- Videocon Industries ltd - India
- The State Trading Corporation of India Ltd
- Therma Luzon, Inc, Philippines
- Eastern Energy - Thailand
- LBH Netherlands Bv - Netherlands
- The Treasury - Australian Government
- Uttam Galva Steels Limited - India
- Mintek Dendrill Indonesia
- Ministry of Transport, Egypt
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Power Finance Corporation Ltd., India
- Coal and Oil Company - UAE
- Carbofer General Trading SA - India
- Indogreen Group - Indonesia
- International Coal Ventures Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Siam City Cement - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- CNBM International Corporation - China
- Petrochimia International Co. Ltd.- Taiwan
- Orica Mining Services - Indonesia
- Central Java Power - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GAC Shipping (India) Pvt Ltd
- Tamil Nadu electricity Board
- Bukit Makmur.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- New Zealand Coal & Carbon
- TeaM Sual Corporation - Philippines
- McConnell Dowell - Australia
- Bharathi Cement Corporation - India
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