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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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Thursday, 24 March 11
DRY BULK MARKET RISES, CAPESIZES GAIN BUT REMAIN LOW EARNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market posted modest gains on Wednesday, with the Baltic Dry Index rising to 1,565 points, up by 1.43 percent on the day, led by gains ...
Wednesday, 23 March 11
INDIAS TNPL RECEIVED 1.120 MMTS OF COAL AGAINST ITS 160K MT INQUIRY
COALspot.com - Tamil Nadu Newsprint and Papers Ltd. has closed its inquiry today.
Seven Indian coal traders have submitted price bid to sup ...
Tuesday, 22 March 11
MONNET ISPAT & ENERGY LIMITED ACQUIRES INDONESIAN COAL COMPANY THROUGH ITS SUBSIDIARY MONNET GLOBAL LIMITED
Monnet Global Limited (MGL) acquires PT Sarwa Sembada Karya Bumi, Sumatra & on part exploration the reserves of 65 million tonne on Thermal Coal ...
Tuesday, 22 March 11
RI COAL EXPORTS TO JAPAN MAY BE DIVERTED TO OTHER COUNTRIES - THE JAKARTA POST
The Jakarta Post reported that, Indonesia’s coal exports to Japan will likely be diverted to other countries for several months after the rece ...
Tuesday, 22 March 11
KRISHNAPATNAM PORT SETS ALL INDIA RECORD FOR COAL DISCHARGING
COALspot.com - "Krishnapatnam Port has set an all India record for discharging 71,587 tons of steam coal in just 24 hrs using the conventional ...
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- Kohat Cement Company Ltd. - Pakistan
- Timah Investasi Mineral - Indoneisa
- Ministry of Finance - Indonesia
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Mercuria Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- PNOC Exploration Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Marubeni Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Holcim Trading Pte Ltd - Singapore
- Agrawal Coal Company - India
- GVK Power & Infra Limited - India
- Sarangani Energy Corporation, Philippines
- Dalmia Cement Bharat India
- Anglo American - United Kingdom
- Deloitte Consulting - India
- Minerals Council of Australia
- Port Waratah Coal Services - Australia
- Pendopo Energi Batubara - Indonesia
- Mjunction Services Limited - India
- Coal and Oil Company - UAE
- Ambuja Cements Ltd - India
- PTC India Limited - India
- Rio Tinto Coal - Australia
- Medco Energi Mining Internasional
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- CNBM International Corporation - China
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- Goldman Sachs - Singapore
- Directorate Of Revenue Intelligence - India
- Global Green Power PLC Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Manunggal Multi Energi - Indonesia
- Riau Bara Harum - Indonesia
- Sindya Power Generating Company Private Ltd
- Carbofer General Trading SA - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Kaltim Prima Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Siam City Cement PLC, Thailand
- PowerSource Philippines DevCo
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- Latin American Coal - Colombia
- Merrill Lynch Commodities Europe
- Price Waterhouse Coopers - Russia
- Renaissance Capital - South Africa
- Bayan Resources Tbk. - Indonesia
- Mercator Lines Limited - India
- Alfred C Toepfer International GmbH - Germany
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Grasim Industreis Ltd - India
- Bhatia International Limited - India
- Kapuas Tunggal Persada - Indonesia
- ASAPP Information Group - India
- Aditya Birla Group - India
- Indian Energy Exchange, India
- Thai Mozambique Logistica
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Vedanta Resources Plc - India
- SN Aboitiz Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Intertek Mineral Services - Indonesia
- Jaiprakash Power Ventures ltd
- GMR Energy Limited - India
- Heidelberg Cement - Germany
- Independent Power Producers Association of India
- McConnell Dowell - Australia
- Samtan Co., Ltd - South Korea
- Cigading International Bulk Terminal - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bukit Makmur.PT - Indonesia
- Essar Steel Hazira Ltd - India
- Chettinad Cement Corporation Ltd - India
- Africa Commodities Group - South Africa
- ICICI Bank Limited - India
- Eastern Energy - Thailand
- SMG Consultants - Indonesia
- MS Steel International - UAE
- Indika Energy - Indonesia
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- The Treasury - Australian Government
- Ceylon Electricity Board - Sri Lanka
- Electricity Authority, New Zealand
- Romanian Commodities Exchange
- Banpu Public Company Limited - Thailand
- Bukit Baiduri Energy - Indonesia
- Lanco Infratech Ltd - India
- Binh Thuan Hamico - Vietnam
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Georgia Ports Authority, United States
- Xindia Steels Limited - India
- Madhucon Powers Ltd - India
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Mintek Dendrill Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kartika Selabumi Mining - Indonesia
- Uttam Galva Steels Limited - India
- Malabar Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- Commonwealth Bank - Australia
- Ind-Barath Power Infra Limited - India
- Cement Manufacturers Association - India
- Gujarat Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Sojitz Corporation - Japan
- Tamil Nadu electricity Board
- Semirara Mining Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Toyota Tsusho Corporation, Japan
- Asmin Koalindo Tuhup - Indonesia
- Indogreen Group - Indonesia
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- Wilmar Investment Holdings
- White Energy Company Limited
- VISA Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- CIMB Investment Bank - Malaysia
- Thiess Contractors Indonesia
- Singapore Mercantile Exchange
- Rashtriya Ispat Nigam Limited - India
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- Bangladesh Power Developement Board
- Standard Chartered Bank - UAE
- Eastern Coal Council - USA
- Therma Luzon, Inc, Philippines
- Petron Corporation, Philippines
- Bhushan Steel Limited - India
- Bhoruka Overseas - Indonesia
- Karaikal Port Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TeaM Sual Corporation - Philippines
- Central Java Power - Indonesia
- New Zealand Coal & Carbon
- Parliament of New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Larsen & Toubro Limited - India
- Gujarat Sidhee Cement - India
- The State Trading Corporation of India Ltd
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- Simpson Spence & Young - Indonesia
- India Bulls Power Limited - India
- Kideco Jaya Agung - Indonesia
- Indian Oil Corporation Limited
- Star Paper Mills Limited - India
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Maharashtra Electricity Regulatory Commission - India
- PetroVietnam Power Coal Import and Supply Company
- Metalloyd Limited - United Kingdom
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Salva Resources Pvt Ltd - India
- Edison Trading Spa - Italy
- Parry Sugars Refinery, India
- Maheswari Brothers Coal Limited - India
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- San Jose City I Power Corp, Philippines
- Antam Resourcindo - Indonesia
- Sical Logistics Limited - India
- Meralco Power Generation, Philippines
- Straits Asia Resources Limited - Singapore
- Orica Mining Services - Indonesia
- Bharathi Cement Corporation - India
- Ministry of Mines - Canada
- The University of Queensland
- London Commodity Brokers - England
- Videocon Industries ltd - India
- Planning Commission, India
- Gujarat Mineral Development Corp Ltd - India
- Bulk Trading Sa - Switzerland
- South Luzon Thermal Energy Corporation
- Directorate General of MIneral and Coal - Indonesia
- Kumho Petrochemical, South Korea
- SMC Global Power, Philippines
- European Bulk Services B.V. - Netherlands
- Borneo Indobara - Indonesia
- Globalindo Alam Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Central Electricity Authority - India
- Economic Council, Georgia
- Power Finance Corporation Ltd., India
- Jorong Barutama Greston.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Krishnapatnam Port Company Ltd. - India
- Australian Coal Association
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