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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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Wednesday, 02 February 11
BAYAN TO SUPPLY COAL TO TP UTILITIES LTD
Insider Stories has reportd that, Indonesia's one of the leading coal miner PT Bayan Resources Tbk (BYAN) owned by businessman Dato' Low Tuck ...
Wednesday, 02 February 11
HUGE TONNAGE OVERSUPPLY LOOMING FOR DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the dry bulk market taking another dive yesterday, to just over 1,000 points (1,084), losing more than 2% on the day, it’s more than obvi ...
Monday, 31 January 11
S. SUMATRA COAL RAILWAY TO BE COMPLETED ON SCHEDULE - THE JAKARTA POST
The Jakarta Post reported that, despite land acquisition problems, state coal mining company PT Bukit Asam is upbeat that the development of a railw ...
Monday, 31 January 11
COAL MINER PTBA TO DRIVE OUTPUT WITH ACQUISITIONS - THE JAKARTA GLOBE
The Jakarta Globe reported that, State coal company Perusahaan Tambang Batubara Bukit Asam said its output would increase 34 percent to 17.6 million ...
Saturday, 29 January 11
PRESSURE ON SHIPPING MARKET MAY CONTINUE UNTIL MID FEBRUARY 2011
COALspot.com - The BDI continues to drop and saw a drop of about 5 pct this week closing at 1370 points.
In May 2010 the BDI touched 4,209 ...
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- SMG Consultants - Indonesia
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- New Zealand Coal & Carbon
- Global Green Power PLC Corporation, Philippines
- Trasteel International SA, Italy
- Independent Power Producers Association of India
- Parry Sugars Refinery, India
- Altura Mining Limited, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Madhucon Powers Ltd - India
- Metalloyd Limited - United Kingdom
- Singapore Mercantile Exchange
- Bangladesh Power Developement Board
- Grasim Industreis Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Indian Energy Exchange, India
- Wilmar Investment Holdings
- Electricity Generating Authority of Thailand
- Eastern Energy - Thailand
- Sinarmas Energy and Mining - Indonesia
- Jindal Steel & Power Ltd - India
- Essar Steel Hazira Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- SMC Global Power, Philippines
- Kaltim Prima Coal - Indonesia
- Energy Development Corp, Philippines
- Siam City Cement PLC, Thailand
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- LBH Netherlands Bv - Netherlands
- GMR Energy Limited - India
- Ministry of Transport, Egypt
- Bhoruka Overseas - Indonesia
- The University of Queensland
- Formosa Plastics Group - Taiwan
- Maharashtra Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- Posco Energy - South Korea
- Riau Bara Harum - Indonesia
- Pendopo Energi Batubara - Indonesia
- Georgia Ports Authority, United States
- Baramulti Group, Indonesia
- Straits Asia Resources Limited - Singapore
- Simpson Spence & Young - Indonesia
- Bukit Baiduri Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Attock Cement Pakistan Limited
- Global Coal Blending Company Limited - Australia
- PTC India Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Petrochimia International Co. Ltd.- Taiwan
- Samtan Co., Ltd - South Korea
- Binh Thuan Hamico - Vietnam
- Edison Trading Spa - Italy
- Barasentosa Lestari - Indonesia
- CNBM International Corporation - China
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Finance - Indonesia
- Timah Investasi Mineral - Indoneisa
- Energy Link Ltd, New Zealand
- Aboitiz Power Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Renaissance Capital - South Africa
- Gujarat Sidhee Cement - India
- Vijayanagar Sugar Pvt Ltd - India
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
- Sojitz Corporation - Japan
- Iligan Light & Power Inc, Philippines
- Malabar Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- VISA Power Limited - India
- Thiess Contractors Indonesia
- Cement Manufacturers Association - India
- International Coal Ventures Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Commonwealth Bank - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parliament of New Zealand
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Vizag Seaport Private Limited - India
- PowerSource Philippines DevCo
- Bukit Asam (Persero) Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- Interocean Group of Companies - India
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Ministry of Mines - Canada
- Kartika Selabumi Mining - Indonesia
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement - Thailand
- Mercator Lines Limited - India
- Alfred C Toepfer International GmbH - Germany
- Agrawal Coal Company - India
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- Marubeni Corporation - India
- Indogreen Group - Indonesia
- Sindya Power Generating Company Private Ltd
- Carbofer General Trading SA - India
- IEA Clean Coal Centre - UK
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- India Bulls Power Limited - India
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- Billiton Holdings Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- Coastal Gujarat Power Limited - India
- Semirara Mining Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Thai Mozambique Logistica
- Karbindo Abesyapradhi - Indoneisa
- ICICI Bank Limited - India
- McConnell Dowell - Australia
- Kobexindo Tractors - Indoneisa
- Uttam Galva Steels Limited - India
- Tata Chemicals Ltd - India
- Directorate Of Revenue Intelligence - India
- Port Waratah Coal Services - Australia
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Sree Jayajothi Cements Limited - India
- Ind-Barath Power Infra Limited - India
- Orica Australia Pty. Ltd.
- Merrill Lynch Commodities Europe
- Coalindo Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Indika Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Mineral Development Corp Ltd - India
- GVK Power & Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- Tamil Nadu electricity Board
- Manunggal Multi Energi - Indonesia
- Lanco Infratech Ltd - India
- Eastern Coal Council - USA
- Anglo American - United Kingdom
- MS Steel International - UAE
- Latin American Coal - Colombia
- Deloitte Consulting - India
- Makarim & Taira - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- San Jose City I Power Corp, Philippines
- Power Finance Corporation Ltd., India
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- Bayan Resources Tbk. - Indonesia
- Toyota Tsusho Corporation, Japan
- Chamber of Mines of South Africa
- Globalindo Alam Lestari - Indonesia
- Standard Chartered Bank - UAE
- Neyveli Lignite Corporation Ltd, - India
- Leighton Contractors Pty Ltd - Australia
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- ASAPP Information Group - India
- Heidelberg Cement - Germany
- Australian Coal Association
- Ambuja Cements Ltd - India
- Mercuria Energy - Indonesia
- Price Waterhouse Coopers - Russia
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Antam Resourcindo - Indonesia
- Meralco Power Generation, Philippines
- Mjunction Services Limited - India
- Bhushan Steel Limited - India
- Goldman Sachs - Singapore
- Mintek Dendrill Indonesia
- Indian Oil Corporation Limited
- Planning Commission, India
- Star Paper Mills Limited - India
- Miang Besar Coal Terminal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Australian Commodity Traders Exchange
- Medco Energi Mining Internasional
- Xindia Steels Limited - India
- The Treasury - Australian Government
- European Bulk Services B.V. - Netherlands
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Dalmia Cement Bharat India
- Holcim Trading Pte Ltd - Singapore
- Coal and Oil Company - UAE
- IHS Mccloskey Coal Group - USA
- Kideco Jaya Agung - Indonesia
- Bhatia International Limited - India
- Central Java Power - Indonesia
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