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Wednesday, 12 October 11
CAPESIZE FREIGHT RATES BOUND TO RETREAT FROM 2011 HIGHS ON THE BACK OF TONNAGE OVERSUPPLY SAYS BIMCO
 According to Nikos Roussanoglou, Hellenic Shipping, with the BDI (Baltic Dry Index) breaking yet another 2011 high yesterday and ending the session at 2,106 points, up by 3.64% on the day, dry bulk ship owners couldn’t be happier. But, as BIMCO’s senior analyst Peter Sand notes, this recent positive development is not rooted in an improved fundamental balance between supply and demand. Thus, it’s likely to see an easing of rates from current levels. “Despite the traditionally strong fourth quarter we estimate that the Capesize Time Charter Average will travel southbound from current highs towards the USD 15,000-20,000 per day as the tonnage oversupply is bound to rule again. Amongst the smaller ship sizes, Panamax and Supramax rates are likely to stay firm in the USD 14,000-18,000 per day. Handysize rates are expected in the USD 10,000-14,000 per day interval” said BIMCO.
The organization forecasts a total delivery of more than 90 million DWT of newbuild dry bulk vessels in 2011. “This will result in a fleet growth of over 14%. Deliveries are biased towards the larger segments, but so is scrapping of over-aged tonnage. It is also worth noticing that conversion of single-hull VLCCs into Very Large Ore Carriers for the last year this time around is expected to push up fleet growth by 3 million DWT.
China is on course to deliver iron ore demand growth of 10%, being more or less the single positive iron ore story in 2011. Regardless of the recent Bull Run in Capesize freight rates, second hand values have continuously leaked. This is supporting the argument of a temporary event. But as spot rates have picked up, so have short-term time charters. Six month time charter rates have doubled since the beginning of August while 1 year charter rates have jumped by 50%. The long end of the forward curve remains unaffected” said BIMCO in its analysis.
Demand-wise BIMCO’s Peter Sand said that “The positive development in Capesize freight rates seen since 22 August, when the USD 16,000 per day lid was blown off, also took the BIMCO Capesize time charter earnings forecast by surprise while the remaining segment earnings forecast were spot on. The Capesize segment has sprinted away from the rest of the field into a break-away that is still rolling. Freight rates for Capesize vessels started to rise on the back of stronger Chinese demand for coal and iron ore. As India is still a reluctant exporter of iron ore, stronger demand resulted in more tonnes-miles as Brazil and Australia pitched in as the swing-providers of this vital steel-ingredient to Chinese steel mills. This boosted Capesize demand at the expense of Supramax demand, which normally lifts Indian iron ore to China. Overall development on the dry bulk markets, as expressed by the BDI, has gained 413 index points since 22 August – equal to 27%.
Over the same period of time, Capesize earnings have gained 74% and this compares to moderate earning gains in the smaller segments. Last year, seaborne iron ore demand grew by 10.6% driven by resumed demand from Europe and Japan following the fall-out in 2009. In 2011, iron ore demand growth is seen only in China but as long as it maintains an insatiable iron ore hunger, Capesize vessels are hanging on. However, at a growth rate of just 6% expected in 2011, demand will be the poorest in the past 10 years. Total coal demand is set to grow by just 2% this year as compared to 15.9% in 2010. This does not bode well for overall Capesize demand as the fleet grew by 23% last year and is on course for 13.4% growth this year (depending on level of recycling, scrap steel demand and freight rate development). The current spike in freight rates, suggested to be due to strong Chinese demand for coal and iron ore in a combination with available tonnage imbalance between the basins, seems fundamentally difficult to maintain as overall available tonnage remains abundant” said BIMCO.
As far as supply goes “the active fleet has grown by 10.1% so far in 2011, caused by delivery of 64.2 million DWT, offset by 18.1 million DWT being demolished. According to BIMCO estimates, the fleet is about to grow by 14.5%, unless planned deliveries are postponed beyond what is already assumed.
“Demolition of older tonnage is estimated at 20 million DWT, but could go as high as 25 million if year-to-date demolition swiftness continues. However, the recent jump in Capesize earnings could prove “sufficient” to cool down the rush to the breakers. 55% of all demolished tonnage has originated from Capesize vessels and that has positively reduced the net fleet growth by 4.4% so far. The Capesize fleet would have grown by 20% in 2011 without any demolition activity at all, but holds now the potential of growth by just 13.4%.
The Handysize segment, which saw 6.7% of the fleet during 2009 and another 3.0% during 2010 being removed due to strong demolition, is once again enjoying a noteworthy amount of 2.5 million DWT scrapped so far in 2011 with a clear potential for more to come. While Handysize are currently scrapped at an average age of 33 years, Capesize vessels are broken up at an average age of 27 years. New orders continue to be placed at slower pace than new ships are delivered, bringing the orderbook down from 241 million DWT two months ago to 236.6 million DWT. The orderbook-to-fleet ratio remains very high at 40.5% as the active fleet has reached 583.8 million DWT. Put into perspective of the amount of new built tonnage delivered in previous years, 2011 represents Mount Everest and 2010-2013 deliveries the Himalaya mountain range” concluded the analysis.
Source: Nikos Roussanoglou, Hellenic Shipping
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Sunday, 09 October 11
FREIGHT MARKET ENDED WITH A POSITIVE DIRECTION - VISTAAR
COALspot.com - The market ended with a positive note with all the segments up except for handy size. The biggest gainer was Panamax index up by 11 p ...
Saturday, 08 October 11
INDONESIAN MINER PLANS $167M IPO TO FUEL SUMATRA COAL BOOM - JG
The Jakarta Globe reported that, coal miner Atlas Resources aims to raise as much as Rp 1.5 trillion ($167 million) in an initial public offering to ...
Friday, 07 October 11
MINING REGULATIONS , OBSTACLES AND GROWTH : INDIA VS INDONESIA - SUNIL K KUMBHAT
COALspot.com - The Govt of India has passed long pending Mines & Minerals (Regulation and Development) Bill, 2011, which seeks to replace ...
Friday, 07 October 11
$100M FOR EXPANSION INTO KALIMANTAN MINING: AKR
The Jakarta Globe, one of the leading English news paper in Indonesia reported that, AKR Corporindo, a fuel and chemical distributor, has set aside ...
Thursday, 06 October 11
REALM SECURES 51% OF KATINGAN RIA COAL PROJECT IN CENTRAL KALIMANTAN
•Realm secures 51% of PT Katingan Ria Thermal Coal Project in Central Kalimantan
•Realm takes ownership of Kalres Limited
•Acquisit ...
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- Offshore Bulk Terminal Pte Ltd, Singapore
- London Commodity Brokers - England
- Vijayanagar Sugar Pvt Ltd - India
- Heidelberg Cement - Germany
- Samtan Co., Ltd - South Korea
- GMR Energy Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Edison Trading Spa - Italy
- Leighton Contractors Pty Ltd - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kumho Petrochemical, South Korea
- The State Trading Corporation of India Ltd
- Bhushan Steel Limited - India
- LBH Netherlands Bv - Netherlands
- PNOC Exploration Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- MS Steel International - UAE
- Sical Logistics Limited - India
- Larsen & Toubro Limited - India
- Sree Jayajothi Cements Limited - India
- Vedanta Resources Plc - India
- PetroVietnam Power Coal Import and Supply Company
- Semirara Mining Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Holcim Trading Pte Ltd - Singapore
- International Coal Ventures Pvt Ltd - India
- ICICI Bank Limited - India
- Global Coal Blending Company Limited - Australia
- Economic Council, Georgia
- Ministry of Finance - Indonesia
- Mjunction Services Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Parliament of New Zealand
- Central Electricity Authority - India
- Posco Energy - South Korea
- Indika Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Sindya Power Generating Company Private Ltd
- Metalloyd Limited - United Kingdom
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Jaiprakash Power Ventures ltd
- Attock Cement Pakistan Limited
- Xindia Steels Limited - India
- Energy Link Ltd, New Zealand
- Parry Sugars Refinery, India
- Grasim Industreis Ltd - India
- Vizag Seaport Private Limited - India
- Intertek Mineral Services - Indonesia
- Savvy Resources Ltd - HongKong
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Bharathi Cement Corporation - India
- Timah Investasi Mineral - Indoneisa
- Straits Asia Resources Limited - Singapore
- SMC Global Power, Philippines
- Cement Manufacturers Association - India
- Australian Coal Association
- Rio Tinto Coal - Australia
- Latin American Coal - Colombia
- Bulk Trading Sa - Switzerland
- Salva Resources Pvt Ltd - India
- Orica Mining Services - Indonesia
- Borneo Indobara - Indonesia
- Madhucon Powers Ltd - India
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- San Jose City I Power Corp, Philippines
- Deloitte Consulting - India
- Interocean Group of Companies - India
- Kaltim Prima Coal - Indonesia
- The Treasury - Australian Government
- Riau Bara Harum - Indonesia
- Sarangani Energy Corporation, Philippines
- Orica Australia Pty. Ltd.
- Aboitiz Power Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Port Waratah Coal Services - Australia
- Commonwealth Bank - Australia
- Coalindo Energy - Indonesia
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- European Bulk Services B.V. - Netherlands
- Tamil Nadu electricity Board
- Star Paper Mills Limited - India
- Therma Luzon, Inc, Philippines
- Essar Steel Hazira Ltd - India
- Independent Power Producers Association of India
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- Maharashtra Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- Sojitz Corporation - Japan
- Kartika Selabumi Mining - Indonesia
- Thai Mozambique Logistica
- Ind-Barath Power Infra Limited - India
- Sakthi Sugars Limited - India
- Globalindo Alam Lestari - Indonesia
- Central Java Power - Indonesia
- Formosa Plastics Group - Taiwan
- Africa Commodities Group - South Africa
- Electricity Authority, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Renaissance Capital - South Africa
- Meralco Power Generation, Philippines
- Bhatia International Limited - India
- Chamber of Mines of South Africa
- Medco Energi Mining Internasional
- Meenaskhi Energy Private Limited - India
- McConnell Dowell - Australia
- Indian Energy Exchange, India
- Videocon Industries ltd - India
- Eastern Coal Council - USA
- Baramulti Group, Indonesia
- VISA Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Antam Resourcindo - Indonesia
- Anglo American - United Kingdom
- Iligan Light & Power Inc, Philippines
- Aditya Birla Group - India
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- Bayan Resources Tbk. - Indonesia
- Tata Chemicals Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Kobexindo Tractors - Indoneisa
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Uttam Galva Steels Limited - India
- Bangladesh Power Developement Board
- Chettinad Cement Corporation Ltd - India
- Bukit Makmur.PT - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PTC India Limited - India
- Oldendorff Carriers - Singapore
- The University of Queensland
- Petron Corporation, Philippines
- Electricity Generating Authority of Thailand
- Malabar Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
- Maheswari Brothers Coal Limited - India
- Indian Oil Corporation Limited
- Kohat Cement Company Ltd. - Pakistan
- Ceylon Electricity Board - Sri Lanka
- TeaM Sual Corporation - Philippines
- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mintek Dendrill Indonesia
- Mercuria Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Transport, Egypt
- Makarim & Taira - Indonesia
- Price Waterhouse Coopers - Russia
- Cigading International Bulk Terminal - Indonesia
- Goldman Sachs - Singapore
- Coastal Gujarat Power Limited - India
- Toyota Tsusho Corporation, Japan
- Wilmar Investment Holdings
- Trasteel International SA, Italy
- Pendopo Energi Batubara - Indonesia
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- ASAPP Information Group - India
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Planning Commission, India
- SMG Consultants - Indonesia
- Barasentosa Lestari - Indonesia
- Indogreen Group - Indonesia
- South Luzon Thermal Energy Corporation
- Agrawal Coal Company - India
- Banpu Public Company Limited - Thailand
- Karaikal Port Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Merrill Lynch Commodities Europe
- Indonesian Coal Mining Association
- GVK Power & Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Marubeni Corporation - India
- IEA Clean Coal Centre - UK
- SN Aboitiz Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Gujarat Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
- Bhoruka Overseas - Indonesia
- Singapore Mercantile Exchange
- Dalmia Cement Bharat India
- Power Finance Corporation Ltd., India
- Altura Mining Limited, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Eastern Energy - Thailand
- Wood Mackenzie - Singapore
- Australian Commodity Traders Exchange
- Minerals Council of Australia
- CNBM International Corporation - China
- Standard Chartered Bank - UAE
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