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Wednesday, 13 April 11
CAPESIZE VESSELS ARE DELIVERED AT A PACE OF ONE NEW VESSEL EVERY SECOND DAY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 In a clear sign that it will take a significant rise in global seaborne dry bulk trade in order to be able to absorb the flurry of new building tonnage thrown into the water, BIMCO has issued a new report, saying, among others, that at the moment Capesize vessels are delivered at a rate of one new vessel every second day. On top of that, 6 VLOC’s have been launched with another 35 potentially up for delivery in 2011 (adjusted for slippage). The report also said that the active fleet has grown by 2.7% so far in 2011, caused by deliveries of 222 newbuilt vessels with an average cargo capacity of 85,000 DWT offset by 67 vessels with a total capacity of 4.8 million DWT being demolished.
On the positive side, “like in the tanker segments, demolition finally, but still surprisingly, has kicked off strongly – positively impacted by the high scrap steel prices. A 25 year-old large Capesize demolition was worth almost USD 11 million. However, the level of demolishing is still considerably below a level that could balance supply and demand and impact the freight markets positively” said the report by BIMCO’s shipping analyst, Peter Sand. “BIMCO forecasts inflow of new dry bulk tonnage in 2011 to be a bit higher than in 2010 at 86 million DWT. As demolitions are expected to reach 12 million DWT, the fleet is forecast to grow by 13.8% in 2011. Newbuilding contracts are being signed at the slowest pace since Q2 in 2009. This is a very positive development, especially seen in the light of the unbelievable high contracting level in 2010 with 78 million DWT of new contracts” said the report.
In terms of the dry bulk market’s outlook, BIMCO said that “the events in Japan, will, in the short term, be a negative story for the dry bulk market as expected high volumes into Japan will be some 10-20 million tons lower, as coal power plants and steel mills have be shut down for a while and some are expected to be so for up to 1 year. In the medium to long term, dry bulk is likely to benefit as reconstruction takes off. Iron ore, coking coal, thermal coal and wood for construction are likely to be in higher demand following the disasters. Unlike Australia, which was a supply story, Japan is mainly about demand falling short – the impact on the freight market has been insignificant as compared to the flooding in Queensland.
BIMCO assesses that Capesize freight rates will remain in depressed territory in the coming months. Capesize Time Charter Average is likely to hover around USD 10,000–15,000 per day and backhaul trip charter earnings likely to continue to make negative returns.
The Capesize fleet has already grown 4.5% this year and overcapacity in the segment will stay a drag on freight rates each time they try to escape the doldrums. Supramax and Panamax are likely to stay firm in the USD 15,000–USD 20,000 per day interval as demand supports this level. Overall, dry bulk commodity demand growth is expected to be around 7-8% in 2011, with iron ore and coal as usual in the driving seat. This outlook provides a solid demand picture to comfort and fence a collapse of earnings, as oversupply is haunting all segments” said the report.
For the time being though, since early January, Capesize time charter rates have been below all the other segments including Handysize. While the 3 smaller segments have rebounded since then, Capesize is still down. “Current average of 4 time-charter routes is USD 10,371 per day. For comparison – a Handysize makes USD 11,849 per day, a Supramax USD 15,921 per day and a Panamax USD 15,807 per day. Spot rates on main Capesize iron ore trades from Brazil and Australia, which are the top two suppliers to the Chinese steel industry, look as if they have bottomed out during January and February. This year’s unfolding story in relation to iron ore trades will be the scheduled delivery of the first 6 out of 19 400,000 DWT VLOC’s to the Brazilian miner, Vale. This is expected to impact the market, as Vale is a large charterer of Capesize tonnage to service its Asian customers. In 2010, Vale exported 131 million tons to China. Estimating 6 round voyage a year, the 6 new build VLOC’s will be able to carry 14.4 million tonnes of iron ore p.a., equal to 11% of Vale exports to China. With another 13 to be delivered over the next 2-3 years, Vale will depend much less on the Capesize chartering market – as it will be self-sufficient in 25-30% of its tonnage demand. The vessels are intended to bring down Vale’s price disadvantage to the Australian iron ore by taking out the longhaul maritime transportation cost element. The spot rates are on average 2½ times higher on Brazilian ore, being a close mirror of the difference in distance.
It remains uncertain where Vale is going to establish its Asian iron ore distribution centre. First Qingdao was targeted, but failed to become a done deal. Lately Vale has focused on a Malaysian distribution hub, but another site remains an option, the Tianjin Dongjiang Free Trade Port Zone near Beijing – a new giant port and logistics centre. The final location will be vital to the success of VLOC’s.
Seaborne Iron ore demand is expected to grow by 7% overall, where China will take the most and European demand will increase to a precrisis level.
Also recently, the commodities trader Cargill has decided to become a ship owner once again, this time round mainly with the purpose of being an asset player. This adds to the number of large charterers making an entry into ship owning primarily with the object of controlling a larger part of the supply chain and converting variable costs to fixed costs.
The demand for taking Capesize vessels on time charter is on a par with last year. Time charter rates are currently higher than spot freight rates, which indicates an extraordinarily weak spot market. Representative deals that support the rather flat medium term expectation in the market are, amongst others, Cargill taking the “Semirio”, 174,000 DWT for two years at USD 17,000 per day and Rio Tinto taking “Bulk India”, 177,000 DWT for one year at USD 16,500 per day”, concluded BIMCO’s analysis
Source: Nikos Roussanoglou, Hellenic Shipping
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Tuesday, 29 March 11
DUTY EXEMPTION UNLIKELY TO IMPACT COKING COAL PRICES - PTI NEWS
Press Trust of India News reported that, the exemption to certain types of coking coal from customs duty is not likely to impact steel prices at pre ...
Monday, 28 March 11
HARUM ENERGY FY10 EARNING UP 7.23% - INSIDER STORIES
Thermal coal producer PT Harum Energy Tbk (HRUM), controlled by Indonesian businessman Kiki Barki through his son Lawrence Barki, posted a slight in ...
Monday, 28 March 11
IBT RAISES CAPACITY OF PULAU LAUT TERMINAL - THE JAKARTA POST
The Jakarta Post reported that, coal infrastructure and logistics firm PT Indonesia Bulk Terminal (IBT), a subsidiary of PT Adaro Energy Tbk, plans ...
Saturday, 26 March 11
THE FREIGHT MARKET REMAINED A BIT VOLATILE THIS WEEK - CAPT. REDDY
COALspot.com - "The freight market remained a bit volatile this week", says Capt. Reddy, director of Vistaar Shipping Singapore.
Howeve ...
Saturday, 26 March 11
FLSMIDTH WINS MULTIMILLION DOLLAR MATERIAL HANDLING PROJECT IN INDONESIA
FLSmidth has signed a contract in Jakarta worth in excess of USD 135m (DKK 700m) with PT Adaro Indonesia, a subsidiary of PT Adaro Energy Tbk., to s ...
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- Maheswari Brothers Coal Limited - India
- Manunggal Multi Energi - Indonesia
- Coastal Gujarat Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Ministry of Transport, Egypt
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Uttam Galva Steels Limited - India
- Goldman Sachs - Singapore
- Agrawal Coal Company - India
- Australian Commodity Traders Exchange
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Generating Authority of Thailand
- Iligan Light & Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Orica Mining Services - Indonesia
- Siam City Cement PLC, Thailand
- Singapore Mercantile Exchange
- Mercator Lines Limited - India
- Sojitz Corporation - Japan
- Georgia Ports Authority, United States
- Indogreen Group - Indonesia
- PTC India Limited - India
- Borneo Indobara - Indonesia
- Banpu Public Company Limited - Thailand
- Kaltim Prima Coal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Ind-Barath Power Infra Limited - India
- Essar Steel Hazira Ltd - India
- Power Finance Corporation Ltd., India
- ASAPP Information Group - India
- SMC Global Power, Philippines
- Madhucon Powers Ltd - India
- Coalindo Energy - Indonesia
- Star Paper Mills Limited - India
- Salva Resources Pvt Ltd - India
- Minerals Council of Australia
- Larsen & Toubro Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Bank of Tokyo Mitsubishi UFJ Ltd
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Antam Resourcindo - Indonesia
- OPG Power Generation Pvt Ltd - India
- Coal and Oil Company - UAE
- European Bulk Services B.V. - Netherlands
- MS Steel International - UAE
- Ministry of Mines - Canada
- Sree Jayajothi Cements Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- Eastern Energy - Thailand
- Gujarat Sidhee Cement - India
- LBH Netherlands Bv - Netherlands
- GAC Shipping (India) Pvt Ltd
- PNOC Exploration Corporation - Philippines
- The University of Queensland
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- GVK Power & Infra Limited - India
- Videocon Industries ltd - India
- Karaikal Port Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rio Tinto Coal - Australia
- Commonwealth Bank - Australia
- Carbofer General Trading SA - India
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Aditya Birla Group - India
- Metalloyd Limited - United Kingdom
- Meralco Power Generation, Philippines
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Kumho Petrochemical, South Korea
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- Global Green Power PLC Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Central Electricity Authority - India
- Gujarat Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- Cement Manufacturers Association - India
- Mercuria Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Xindia Steels Limited - India
- Bhushan Steel Limited - India
- Attock Cement Pakistan Limited
- San Jose City I Power Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Binh Thuan Hamico - Vietnam
- Parry Sugars Refinery, India
- New Zealand Coal & Carbon
- Barasentosa Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- South Luzon Thermal Energy Corporation
- Tata Chemicals Ltd - India
- TeaM Sual Corporation - Philippines
- Merrill Lynch Commodities Europe
- The State Trading Corporation of India Ltd
- Neyveli Lignite Corporation Ltd, - India
- Petron Corporation, Philippines
- Indonesian Coal Mining Association
- Directorate Of Revenue Intelligence - India
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Savvy Resources Ltd - HongKong
- Standard Chartered Bank - UAE
- Kobexindo Tractors - Indoneisa
- Eastern Coal Council - USA
- Marubeni Corporation - India
- Kapuas Tunggal Persada - Indonesia
- Planning Commission, India
- Mjunction Services Limited - India
- ICICI Bank Limited - India
- Therma Luzon, Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Global Coal Blending Company Limited - Australia
- Edison Trading Spa - Italy
- PowerSource Philippines DevCo
- Independent Power Producers Association of India
- GMR Energy Limited - India
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Oldendorff Carriers - Singapore
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CNBM International Corporation - China
- Heidelberg Cement - Germany
- Wilmar Investment Holdings
- Mintek Dendrill Indonesia
- Bulk Trading Sa - Switzerland
- Billiton Holdings Pty Ltd - Australia
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Parliament of New Zealand
- Deloitte Consulting - India
- Latin American Coal - Colombia
- Sarangani Energy Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Kalimantan Lumbung Energi - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement - Thailand
- Ministry of Finance - Indonesia
- The Treasury - Australian Government
- Kartika Selabumi Mining - Indonesia
- Medco Energi Mining Internasional
- Bukit Asam (Persero) Tbk - Indonesia
- India Bulls Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Economic Council, Georgia
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Price Waterhouse Coopers - Russia
- Thai Mozambique Logistica
- Grasim Industreis Ltd - India
- Africa Commodities Group - South Africa
- Jindal Steel & Power Ltd - India
- Samtan Co., Ltd - South Korea
- Dalmia Cement Bharat India
- Bangladesh Power Developement Board
- Vijayanagar Sugar Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- VISA Power Limited - India
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Indian Energy Exchange, India
- Posco Energy - South Korea
- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- PetroVietnam Power Coal Import and Supply Company
- Chamber of Mines of South Africa
- Krishnapatnam Port Company Ltd. - India
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Sakthi Sugars Limited - India
- Wood Mackenzie - Singapore
- Malabar Cements Ltd - India
- Ambuja Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Global Business Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Sindya Power Generating Company Private Ltd
- Electricity Authority, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- CIMB Investment Bank - Malaysia
- Thiess Contractors Indonesia
- Riau Bara Harum - Indonesia
- Bukit Baiduri Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- Energy Link Ltd, New Zealand
- IHS Mccloskey Coal Group - USA
- Sical Logistics Limited - India
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