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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, 08 February 11
PUSTAKA JAYA PALU POWER LOOKING FOR 5800 GAD COAL
COALspot.com - According to market information, PT Pustaka Jaya Palu Power, a power plant operator of the Mpanau plant, Palu, Sulawesi has invited c ...
Tuesday, 08 February 11
BAYAN, KANGAROO EXTEND DUE DILIGENCE
Coal miner controlled by businessman Dato' Low Tuck Kwong PT Bayan Resources Tbk (BYAN) and Australia-listed coal company Kangaroo Resources Limite ...
Tuesday, 08 February 11
DRY BULK: IS THE TIDE TURNING? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what could be perceived as a change of market sentiment for the better, the dry bulk industry’s benchmark, the Baltic Dry Index (BDI) poste ...
Monday, 07 February 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 13.03 PERCENT IN FEBRUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the February 2011 Indonesian Coal Reference Price for therma ...
Monday, 07 February 11
COAL PRICES ON RISE: DEMAND FROM INDIA AND CHINA - ANALYZED SUNIL K KUMBHAT
INDONESIA IS HEART OF ASIAN COAL BOOM
COALspot.com - Rising demand of Coal from India and China, coupled with global financial recovery, is driv ...
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- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Energy Development Corp, Philippines
- Price Waterhouse Coopers - Russia
- Global Coal Blending Company Limited - Australia
- Kumho Petrochemical, South Korea
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- New Zealand Coal & Carbon
- Xindia Steels Limited - India
- Heidelberg Cement - Germany
- Indonesian Coal Mining Association
- South Luzon Thermal Energy Corporation
- Barasentosa Lestari - Indonesia
- Medco Energi Mining Internasional
- Electricity Generating Authority of Thailand
- Wilmar Investment Holdings
- Siam City Cement PLC, Thailand
- Ministry of Finance - Indonesia
- Jaiprakash Power Ventures ltd
- Edison Trading Spa - Italy
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- Anglo American - United Kingdom
- Electricity Authority, New Zealand
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- International Coal Ventures Pvt Ltd - India
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Karaikal Port Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Orica Mining Services - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Merrill Lynch Commodities Europe
- Sakthi Sugars Limited - India
- Grasim Industreis Ltd - India
- Salva Resources Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Savvy Resources Ltd - HongKong
- Ambuja Cements Ltd - India
- London Commodity Brokers - England
- Holcim Trading Pte Ltd - Singapore
- Thai Mozambique Logistica
- European Bulk Services B.V. - Netherlands
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Metalloyd Limited - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Posco Energy - South Korea
- Bharathi Cement Corporation - India
- Bhushan Steel Limited - India
- Ministry of Mines - Canada
- San Jose City I Power Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Parliament of New Zealand
- CNBM International Corporation - China
- Gujarat Mineral Development Corp Ltd - India
- Malabar Cements Ltd - India
- Cigading International Bulk Terminal - Indonesia
- VISA Power Limited - India
- Ind-Barath Power Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- India Bulls Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- MS Steel International - UAE
- Rio Tinto Coal - Australia
- Dalmia Cement Bharat India
- Eastern Coal Council - USA
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- Port Waratah Coal Services - Australia
- The University of Queensland
- Global Business Power Corporation, Philippines
- Central Java Power - Indonesia
- Independent Power Producers Association of India
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- Cement Manufacturers Association - India
- Global Green Power PLC Corporation, Philippines
- Romanian Commodities Exchange
- Planning Commission, India
- Tata Chemicals Ltd - India
- Eastern Energy - Thailand
- Deloitte Consulting - India
- Leighton Contractors Pty Ltd - Australia
- ICICI Bank Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Globalindo Alam Lestari - Indonesia
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indo Tambangraya Megah - Indonesia
- Sojitz Corporation - Japan
- Economic Council, Georgia
- Vedanta Resources Plc - India
- Meenaskhi Energy Private Limited - India
- Latin American Coal - Colombia
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sarangani Energy Corporation, Philippines
- Agrawal Coal Company - India
- Essar Steel Hazira Ltd - India
- Georgia Ports Authority, United States
- Karbindo Abesyapradhi - Indoneisa
- Videocon Industries ltd - India
- Chettinad Cement Corporation Ltd - India
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- Singapore Mercantile Exchange
- Siam City Cement - Thailand
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Thiess Contractors Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Directorate Of Revenue Intelligence - India
- Neyveli Lignite Corporation Ltd, - India
- Attock Cement Pakistan Limited
- Directorate General of MIneral and Coal - Indonesia
- Carbofer General Trading SA - India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Sree Jayajothi Cements Limited - India
- GMR Energy Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Coal and Oil Company - UAE
- PNOC Exploration Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kideco Jaya Agung - Indonesia
- Standard Chartered Bank - UAE
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- Toyota Tsusho Corporation, Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercuria Energy - Indonesia
- Madhucon Powers Ltd - India
- Timah Investasi Mineral - Indoneisa
- Chamber of Mines of South Africa
- White Energy Company Limited
- Indian Energy Exchange, India
- Mintek Dendrill Indonesia
- Indian Oil Corporation Limited
- Jorong Barutama Greston.PT - Indonesia
- The State Trading Corporation of India Ltd
- Energy Link Ltd, New Zealand
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Minerals Council of Australia
- IHS Mccloskey Coal Group - USA
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- Wood Mackenzie - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- Kepco SPC Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- ASAPP Information Group - India
- Straits Asia Resources Limited - Singapore
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- Ministry of Transport, Egypt
- Vijayanagar Sugar Pvt Ltd - India
- Coalindo Energy - Indonesia
- SMC Global Power, Philippines
- Semirara Mining and Power Corporation, Philippines
- Renaissance Capital - South Africa
- Semirara Mining Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- McConnell Dowell - Australia
- Makarim & Taira - Indonesia
- Oldendorff Carriers - Singapore
- Maharashtra Electricity Regulatory Commission - India
- GAC Shipping (India) Pvt Ltd
- Goldman Sachs - Singapore
- CIMB Investment Bank - Malaysia
- Sindya Power Generating Company Private Ltd
- Indika Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- Orica Australia Pty. Ltd.
- Bayan Resources Tbk. - Indonesia
- Mjunction Services Limited - India
- Bangladesh Power Developement Board
- Meralco Power Generation, Philippines
- Formosa Plastics Group - Taiwan
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Uttam Galva Steels Limited - India
- Gujarat Sidhee Cement - India
- PTC India Limited - India
- Star Paper Mills Limited - India
- Commonwealth Bank - Australia
- Riau Bara Harum - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
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