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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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Monday, 10 January 11
DEWA SEEKS ADVICE ON COAL POWER PROJECT -THE NATIONAL
The Dubai utility company gets nine bids from international groups for consultancy role.
The National reported that, Dubai's utility company wil ...
Saturday, 08 January 11
COAL PRICE WILL RISE IN SHORT-TERM DUE TO AUSTRALIA FLOODS - ALBUQUERQUE EXPRESS
Albuquerque Express reported that, Queensland’s mining minister, Stephen Robertson, has warned that the Australian state’s coal mines wi ...
Saturday, 08 January 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 8.69 PERCENT IN JANUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the January 2011 Indonesian Coal Reference Price for thermal ...
Saturday, 08 January 11
SUPRAMAX VESSELS WERE FIXED AT AROUND $ 9000 PD FOR A TRIP VIA INDONESIA TO INDIA - VISTAAR
COALspot.com - The holiday season affect combined with severe flooding in Queensland ports continues to keep the market and pressure. “Suprama ...
Saturday, 08 January 11
DIFFICULT YEAR FOR SHIPPING - TRANSPORT WEEKLY
Transport Weekly reported that, Shipping Corporation of India (SCI) chairman Sabyasachi Hajara says 2011 will be a difficult year because an excess ...
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- PTC India Limited - India
- Indogreen Group - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Price Waterhouse Coopers - Russia
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- Orica Australia Pty. Ltd.
- Straits Asia Resources Limited - Singapore
- Latin American Coal - Colombia
- The State Trading Corporation of India Ltd
- Samtan Co., Ltd - South Korea
- Eastern Energy - Thailand
- Sree Jayajothi Cements Limited - India
- The University of Queensland
- Larsen & Toubro Limited - India
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- Kobexindo Tractors - Indoneisa
- Vedanta Resources Plc - India
- Africa Commodities Group - South Africa
- Global Business Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Electricity Authority, New Zealand
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Sidhee Cement - India
- Vijayanagar Sugar Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Bhoruka Overseas - Indonesia
- VISA Power Limited - India
- Global Coal Blending Company Limited - Australia
- Metalloyd Limited - United Kingdom
- Malabar Cements Ltd - India
- GVK Power & Infra Limited - India
- Manunggal Multi Energi - Indonesia
- Therma Luzon, Inc, Philippines
- European Bulk Services B.V. - Netherlands
- White Energy Company Limited
- Bangladesh Power Developement Board
- Interocean Group of Companies - India
- Australian Commodity Traders Exchange
- Banpu Public Company Limited - Thailand
- Eastern Coal Council - USA
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Meenaskhi Energy Private Limited - India
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Sarangani Energy Corporation, Philippines
- Wilmar Investment Holdings
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Trasteel International SA, Italy
- Kartika Selabumi Mining - Indonesia
- Uttam Galva Steels Limited - India
- Savvy Resources Ltd - HongKong
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- Electricity Generating Authority of Thailand
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- GN Power Mariveles Coal Plant, Philippines
- Indo Tambangraya Megah - Indonesia
- Port Waratah Coal Services - Australia
- Ind-Barath Power Infra Limited - India
- South Luzon Thermal Energy Corporation
- Romanian Commodities Exchange
- Central Java Power - Indonesia
- Thai Mozambique Logistica
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- Riau Bara Harum - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Intertek Mineral Services - Indonesia
- Minerals Council of Australia
- Ambuja Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Georgia Ports Authority, United States
- Posco Energy - South Korea
- Kohat Cement Company Ltd. - Pakistan
- Mercuria Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SMC Global Power, Philippines
- Oldendorff Carriers - Singapore
- Vizag Seaport Private Limited - India
- Essar Steel Hazira Ltd - India
- Chettinad Cement Corporation Ltd - India
- Semirara Mining Corp, Philippines
- Videocon Industries ltd - India
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Medco Energi Mining Internasional
- IHS Mccloskey Coal Group - USA
- Baramulti Group, Indonesia
- Edison Trading Spa - Italy
- Central Electricity Authority - India
- Kapuas Tunggal Persada - Indonesia
- Rio Tinto Coal - Australia
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Merrill Lynch Commodities Europe
- MS Steel International - UAE
- TeaM Sual Corporation - Philippines
- Aditya Birla Group - India
- Holcim Trading Pte Ltd - Singapore
- Bayan Resources Tbk. - Indonesia
- Thiess Contractors Indonesia
- Bukit Baiduri Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Star Paper Mills Limited - India
- Mercator Lines Limited - India
- Kideco Jaya Agung - Indonesia
- Bulk Trading Sa - Switzerland
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Indonesian Coal Mining Association
- Iligan Light & Power Inc, Philippines
- Lanco Infratech Ltd - India
- Simpson Spence & Young - Indonesia
- Kepco SPC Power Corporation, Philippines
- Dalmia Cement Bharat India
- Billiton Holdings Pty Ltd - Australia
- Mintek Dendrill Indonesia
- Parliament of New Zealand
- Standard Chartered Bank - UAE
- Rashtriya Ispat Nigam Limited - India
- Marubeni Corporation - India
- Gujarat Electricity Regulatory Commission - India
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Transport, Egypt
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PetroVietnam Power Coal Import and Supply Company
- SMG Consultants - Indonesia
- Planning Commission, India
- Formosa Plastics Group - Taiwan
- Meralco Power Generation, Philippines
- Siam City Cement - Thailand
- Globalindo Alam Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- Energy Link Ltd, New Zealand
- Makarim & Taira - Indonesia
- Agrawal Coal Company - India
- Tamil Nadu electricity Board
- Bharathi Cement Corporation - India
- The Treasury - Australian Government
- Kaltim Prima Coal - Indonesia
- Heidelberg Cement - Germany
- Neyveli Lignite Corporation Ltd, - India
- Bahari Cakrawala Sebuku - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Attock Cement Pakistan Limited
- New Zealand Coal & Carbon
- Energy Development Corp, Philippines
- ICICI Bank Limited - India
- AsiaOL BioFuels Corp., Philippines
- Semirara Mining and Power Corporation, Philippines
- Sakthi Sugars Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Maheswari Brothers Coal Limited - India
- Antam Resourcindo - Indonesia
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Anglo American - United Kingdom
- London Commodity Brokers - England
- Barasentosa Lestari - Indonesia
- Renaissance Capital - South Africa
- Binh Thuan Hamico - Vietnam
- Cigading International Bulk Terminal - Indonesia
- Ministry of Mines - Canada
- Cement Manufacturers Association - India
- Bhatia International Limited - India
- Commonwealth Bank - Australia
- OPG Power Generation Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Aboitiz Power Corporation - Philippines
- Gujarat Mineral Development Corp Ltd - India
- Goldman Sachs - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Economic Council, Georgia
- Krishnapatnam Port Company Ltd. - India
- Jorong Barutama Greston.PT - Indonesia
- Xindia Steels Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Indian Oil Corporation Limited
- Asmin Koalindo Tuhup - Indonesia
- Kumho Petrochemical, South Korea
- Deloitte Consulting - India
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Indika Energy - Indonesia
- Indian Energy Exchange, India
- Siam City Cement PLC, Thailand
- CIMB Investment Bank - Malaysia
- Australian Coal Association
- Bukit Makmur.PT - Indonesia
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