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Tuesday, 15 February 11
TONNAGE OVERSUPPLY TO CHOKE FREIGHT RATES IN THE COMING MONTHS SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 In a new report assessing the dry bulk market, BIMCO’s analysis suggests that freight rates for Capesize vessels are likely to remain depressed in the coming months, with supply-side pressure being the dominant factor in the fundamental supply-demand equation.
According to BIMCO’s shipping analyst, Peter Sand, “for the smaller ships, modest increases in earnings might be seen in the second and third quarters, boosted by demand for Australian, US and South American grains. At the end of the day such low freight rates spell out disaster for ship owners – in particular the ones trading in the spot markets or on long-term charters on a floating rate linked to the BDI. And when rates are low, even more vessels play the spot markets as they don’t want to enter into long-term deals on such low levels. Brokers are reporting that some owners are refusing charters at current rates in a move to improve the situation” he said.
During most of 2010, Capesize rates have defied gravity on the back of strong demand for particularly coal and also for iron ore. Average time charter rates of $33,298 per day in 2010 were a positive surprise to what was expected to be a hardship year. The strong demand positively affected the market and significantly reduced the downside effects stemming from the heavy inflow of new tonnage into the market. In 2010 the Capesize fleet grew by 202 vessels of 38 million DWT (+22.4%) and the forecast for 2011 is an equally challenging supply side growth said the report.
Still, demand proved to be pretty robust for the most part during 2010. According to Clarksons demand for major and minor bulk grew by 10% last year, with iron ore leading the forray, as advanced economies returned to the market to supplement the stand-still growth from China. Strong coal demand also proved to be a new market parameter and 2011 is also set to provide very solid demand growth figures. Iron ore and coal are basically the only two commodities that are shipped on Capesize vessels. A large amount of vessels continue to be chartered to haul iron ore to China, but the firm volumes are not enough to fully stem the ongoing decline in Capesize rates.
“As an extreme example of too many ships and trades being increasingly front-haul biased from the Atlantic into the Pacific came as the C11 back-haul route slipped into negative territory. On 13 January, the Baltic Exchange Capesize Route C11 from China/Japan to Europe was estimated at minus USD 229 per day. Since then the rates have worsened even further. At those rates, far below break-even OPEX-levels, owners are literally paying charterers to carry their goods in order to reposition the vessel at the lowest possible expense.
Meanwhile, the smaller segments are kept afloat on the back of the multiple commodities transported in those vessels alongside strong demand for grain shipments from the US Gulf. This is helping to ease some of the negative sentiment in the market deriving from the weather-related problems in Australia, Colombia, South Africa, and Indonesia” said BIMCO.
As has already been mentioned, one way for the industry to ease the way to a recovery in freight rates is by demolition of large amounts of old tonnage. So far in 2011, as much as 1.5 million DWT of an average age of 32 years has been reported ready for breaking. In the course of 2010 just 5.7 million DWT was demolished, as the freight rate level did not encourage demolition of tonnage.
Despite low freight rates and high scrap prices, BIMCO expect that 2011 will only see 12 million DWT sold for scrap. Currently, 24 million DWT is 30 years of age or older.
As the World’s number one demolition location, Bangladesh, remains closed for business, India, China and Pakistan offer prices close to $500 per ldt. These price levels have not been around since the tight demolition markets in mid-2008 before the financial crisis.
The active fleet has grown by 1.1% so far in 2011, caused by deliveries of 7.6 million DWT in the form of 85 new built vessels offset by considerable 1.5 million DWT being demolished.
BIMCO forecasts inflow of new dry bulk tonnage in 2011 to reach 83 million DWT, offset by demolition of 12 million DWT. This will make the fleet grow by 13.3% in 2011.
Already in January deliveries in the Capesize segment amounted to 22 ships comprising 4.1 million new DWT.
Last year Vale converted 9 single-hulled VLCC’s into very large ore carriers. In total, 13 million DWT of converted tankers has entered the dry bulk fleet during the past two years. Only a significant amount of converted DWT is expected to enter the fleet in 2011.
Source: Nikos Roussanoglou, Hellenic Shipping
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Thursday, 17 February 11
UNCERTAINTY AND VOLATILITY - FEARNBULK
Handy
Recovering market as evidenced by the solid USD 16k/day achieved by a handymax from Continent to east Med with scrap. More short period requ ...
Tuesday, 15 February 11
INDONESIAN COAL FOR HARYANA THERMAL PLANTS - PUNJAB NEWS LINE
To tide over the recurring coal shortage at thermal plants Haryana Power Generation Corporation Limited (HPGCL) has gone for Malaysian coal for its ...
Sunday, 13 February 11
COAL MARKETS 2011 TO HIGHLIGHT INDONESIAN COAL AND NEW SOURCES OF COAL SUPPLY
“Over 300 senior decision-makers from coal mining, power and trading companies expected to congregate in Singapore”
Press Release - K ...
Sunday, 13 February 11
YEAR OF RABBIT PUSHING FREIGHT MARKET UP
COALspot.com – “The market finally moved up with firmness in all sectors with some positive signs of markets recovering”, said Cap ...
Friday, 11 February 11
DRY BULK MARKET HEATING UP ON FRESH CARGO DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market is on a high this week, with owners of smaller vessels turning their attention towards the spot market, in order to take advanta ...
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- MS Steel International - UAE
- South Luzon Thermal Energy Corporation
- PNOC Exploration Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Barasentosa Lestari - Indonesia
- Orica Australia Pty. Ltd.
- Sree Jayajothi Cements Limited - India
- Samtan Co., Ltd - South Korea
- ASAPP Information Group - India
- McConnell Dowell - Australia
- Globalindo Alam Lestari - Indonesia
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- Kartika Selabumi Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- Altura Mining Limited, Indonesia
- Meralco Power Generation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Bulk Trading Sa - Switzerland
- IHS Mccloskey Coal Group - USA
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- SN Aboitiz Power Inc, Philippines
- Xindia Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Aboitiz Power Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Australian Coal Association
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- Africa Commodities Group - South Africa
- London Commodity Brokers - England
- Kepco SPC Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Holcim Trading Pte Ltd - Singapore
- Leighton Contractors Pty Ltd - Australia
- Siam City Cement - Thailand
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- VISA Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- Tata Chemicals Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- ICICI Bank Limited - India
- Bhushan Steel Limited - India
- Commonwealth Bank - Australia
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- Bangladesh Power Developement Board
- Kobexindo Tractors - Indoneisa
- SMC Global Power, Philippines
- Planning Commission, India
- Kumho Petrochemical, South Korea
- Kohat Cement Company Ltd. - Pakistan
- Chamber of Mines of South Africa
- Vizag Seaport Private Limited - India
- Rio Tinto Coal - Australia
- Siam City Cement PLC, Thailand
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Electricity Authority, New Zealand
- Parliament of New Zealand
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Global Business Power Corporation, Philippines
- Heidelberg Cement - Germany
- Minerals Council of Australia
- Maharashtra Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- Edison Trading Spa - Italy
- Salva Resources Pvt Ltd - India
- Medco Energi Mining Internasional
- Grasim Industreis Ltd - India
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Indo Tambangraya Megah - Indonesia
- IEA Clean Coal Centre - UK
- Gujarat Mineral Development Corp Ltd - India
- Anglo American - United Kingdom
- Indika Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Bhatia International Limited - India
- Ambuja Cements Ltd - India
- GAC Shipping (India) Pvt Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Mjunction Services Limited - India
- Indian Energy Exchange, India
- Sindya Power Generating Company Private Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Essar Steel Hazira Ltd - India
- Vedanta Resources Plc - India
- The State Trading Corporation of India Ltd
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Economic Council, Georgia
- Pipit Mutiara Jaya. PT, Indonesia
- Toyota Tsusho Corporation, Japan
- Port Waratah Coal Services - Australia
- Sakthi Sugars Limited - India
- New Zealand Coal & Carbon
- Indonesian Coal Mining Association
- Goldman Sachs - Singapore
- Intertek Mineral Services - Indonesia
- Sojitz Corporation - Japan
- Marubeni Corporation - India
- Kideco Jaya Agung - Indonesia
- Malabar Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Merrill Lynch Commodities Europe
- Mercator Lines Limited - India
- Indogreen Group - Indonesia
- India Bulls Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- CIMB Investment Bank - Malaysia
- Energy Development Corp, Philippines
- Mintek Dendrill Indonesia
- Sical Logistics Limited - India
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Baramulti Group, Indonesia
- Central Java Power - Indonesia
- Larsen & Toubro Limited - India
- Chettinad Cement Corporation Ltd - India
- Wood Mackenzie - Singapore
- Renaissance Capital - South Africa
- Riau Bara Harum - Indonesia
- Ministry of Transport, Egypt
- Directorate Of Revenue Intelligence - India
- Mercuria Energy - Indonesia
- Trasteel International SA, Italy
- Jaiprakash Power Ventures ltd
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Finance - Indonesia
- Standard Chartered Bank - UAE
- Cement Manufacturers Association - India
- Jindal Steel & Power Ltd - India
- Banpu Public Company Limited - Thailand
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- Tamil Nadu electricity Board
- Interocean Group of Companies - India
- Dalmia Cement Bharat India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CNBM International Corporation - China
- Star Paper Mills Limited - India
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Price Waterhouse Coopers - Russia
- Straits Asia Resources Limited - Singapore
- Metalloyd Limited - United Kingdom
- Binh Thuan Hamico - Vietnam
- Thai Mozambique Logistica
- Sarangani Energy Corporation, Philippines
- Posco Energy - South Korea
- Meenaskhi Energy Private Limited - India
- GVK Power & Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Singapore Mercantile Exchange
- Jorong Barutama Greston.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Latin American Coal - Colombia
- Gujarat Electricity Regulatory Commission - India
- Petron Corporation, Philippines
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- TeaM Sual Corporation - Philippines
- Antam Resourcindo - Indonesia
- Electricity Generating Authority of Thailand
- Coal and Oil Company - UAE
- Parry Sugars Refinery, India
- Cigading International Bulk Terminal - Indonesia
- Carbofer General Trading SA - India
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Miang Besar Coal Terminal - Indonesia
- Gujarat Sidhee Cement - India
- Sinarmas Energy and Mining - Indonesia
- San Jose City I Power Corp, Philippines
- Central Electricity Authority - India
- Videocon Industries ltd - India
- Coastal Gujarat Power Limited - India
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- Wilmar Investment Holdings
- White Energy Company Limited
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- International Coal Ventures Pvt Ltd - India
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