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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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Saturday, 17 September 11
GVK ACQUIRES HANCOCK COAL AND INFRASTRUCTURE FOR US$ 1.26 BILLION
COALspot.com - GVK group, India’s leading infrastructure developer,confirmed arrangements for the acquisition of a strategic part of large, hi ...
Saturday, 17 September 11
INDIA'S GVK ACQUIRES HANCOCK COAL AND INFRASTRUCTURE PROJECTS IN AUSTRALIA
COALspot.com - GVK group, India’s leading infrastructure developer, today confirmed arrangements for the acquisition of a strategic part of la ...
Friday, 16 September 11
DELTA DUNIA MAKMUR REMOVED 30.9 MILLION BCM OVERBURDEN IN AUGUST 2011
COALspot.com - PT. Delta Dunia Makmur Tbk has removed 30.9 million bcm (+13.2% YoY) overburden in August 2011 while coal production was at 2.9 ...
Thursday, 15 September 11
RUSSIAN COAL EXPORTS UP 10.9% IN JAN-AUG TO 71.50 MILLION TONS - PORT NEWS / HELLENIC SHIPPING
Port News reported that, Coal exports from Russia in January-August 2011 grew by 10.9% compared with the same period last year, to 71.50 million ton ...
Thursday, 15 September 11
INDIAN GOVT PLANS TO DEVELOP 9 NEW MAJOR PORTS BY 2016 - INVEST MONEY / HELLENIC SHIPPING
The government has announced to make a investment of more than Rs 22,000 crore (approximately US$ 4,623,791,331) to develop nine new major ...
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- Bangladesh Power Developement Board
- Holcim Trading Pte Ltd - Singapore
- Anglo American - United Kingdom
- Rio Tinto Coal - Australia
- PTC India Limited - India
- Kumho Petrochemical, South Korea
- Sree Jayajothi Cements Limited - India
- Billiton Holdings Pty Ltd - Australia
- Ceylon Electricity Board - Sri Lanka
- Kapuas Tunggal Persada - Indonesia
- Petron Corporation, Philippines
- Oldendorff Carriers - Singapore
- Riau Bara Harum - Indonesia
- Kartika Selabumi Mining - Indonesia
- Global Green Power PLC Corporation, Philippines
- Coalindo Energy - Indonesia
- ASAPP Information Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Renaissance Capital - South Africa
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- Therma Luzon, Inc, Philippines
- Australian Commodity Traders Exchange
- Leighton Contractors Pty Ltd - Australia
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Sojitz Corporation - Japan
- Rashtriya Ispat Nigam Limited - India
- Electricity Authority, New Zealand
- Merrill Lynch Commodities Europe
- OPG Power Generation Pvt Ltd - India
- Agrawal Coal Company - India
- Directorate Of Revenue Intelligence - India
- Vedanta Resources Plc - India
- Maharashtra Electricity Regulatory Commission - India
- Georgia Ports Authority, United States
- Makarim & Taira - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Videocon Industries ltd - India
- Siam City Cement PLC, Thailand
- The State Trading Corporation of India Ltd
- Banpu Public Company Limited - Thailand
- Simpson Spence & Young - Indonesia
- Larsen & Toubro Limited - India
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CNBM International Corporation - China
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Essar Steel Hazira Ltd - India
- Ind-Barath Power Infra Limited - India
- GVK Power & Infra Limited - India
- Australian Coal Association
- Chamber of Mines of South Africa
- Latin American Coal - Colombia
- Indian Oil Corporation Limited
- AsiaOL BioFuels Corp., Philippines
- Jindal Steel & Power Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Iligan Light & Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- White Energy Company Limited
- Edison Trading Spa - Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aditya Birla Group - India
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- ICICI Bank Limited - India
- Formosa Plastics Group - Taiwan
- PowerSource Philippines DevCo
- Ministry of Transport, Egypt
- Grasim Industreis Ltd - India
- Mintek Dendrill Indonesia
- Altura Mining Limited, Indonesia
- Global Business Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Ambuja Cements Ltd - India
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- Romanian Commodities Exchange
- Star Paper Mills Limited - India
- Karaikal Port Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Mines - Canada
- VISA Power Limited - India
- Borneo Indobara - Indonesia
- Indo Tambangraya Megah - Indonesia
- Maheswari Brothers Coal Limited - India
- Malabar Cements Ltd - India
- Savvy Resources Ltd - HongKong
- Kideco Jaya Agung - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Tata Chemicals Ltd - India
- Marubeni Corporation - India
- CIMB Investment Bank - Malaysia
- Thai Mozambique Logistica
- Meralco Power Generation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bulk Trading Sa - Switzerland
- Planning Commission, India
- SN Aboitiz Power Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- New Zealand Coal & Carbon
- South Luzon Thermal Energy Corporation
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Eastern Energy - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Semirara Mining and Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Pipit Mutiara Jaya. PT, Indonesia
- Attock Cement Pakistan Limited
- Sindya Power Generating Company Private Ltd
- Vizag Seaport Private Limited - India
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- MS Steel International - UAE
- Bank of Tokyo Mitsubishi UFJ Ltd
- Carbofer General Trading SA - India
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- Dalmia Cement Bharat India
- Sical Logistics Limited - India
- Thiess Contractors Indonesia
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Bhatia International Limited - India
- Parliament of New Zealand
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Mercuria Energy - Indonesia
- Siam City Cement - Thailand
- Central Electricity Authority - India
- Energy Link Ltd, New Zealand
- McConnell Dowell - Australia
- Orica Mining Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kobexindo Tractors - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- Jorong Barutama Greston.PT - Indonesia
- TeaM Sual Corporation - Philippines
- Wood Mackenzie - Singapore
- Tamil Nadu electricity Board
- Sarangani Energy Corporation, Philippines
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- Jaiprakash Power Ventures ltd
- Semirara Mining Corp, Philippines
- Standard Chartered Bank - UAE
- Samtan Co., Ltd - South Korea
- Chettinad Cement Corporation Ltd - India
- Gujarat Sidhee Cement - India
- Interocean Group of Companies - India
- Goldman Sachs - Singapore
- Barasentosa Lestari - Indonesia
- Pendopo Energi Batubara - Indonesia
- The Treasury - Australian Government
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- GAC Shipping (India) Pvt Ltd
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Energy Development Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Uttam Galva Steels Limited - India
- Toyota Tsusho Corporation, Japan
- Bukit Makmur.PT - Indonesia
- Port Waratah Coal Services - Australia
- Bharathi Cement Corporation - India
- Trasteel International SA, Italy
- Karbindo Abesyapradhi - Indoneisa
- London Commodity Brokers - England
- Global Coal Blending Company Limited - Australia
- San Jose City I Power Corp, Philippines
- Deloitte Consulting - India
- Binh Thuan Hamico - Vietnam
- Electricity Generating Authority of Thailand
- Price Waterhouse Coopers - Russia
- Intertek Mineral Services - Indonesia
- Bhushan Steel Limited - India
- Coastal Gujarat Power Limited - India
- SMG Consultants - Indonesia
- Parry Sugars Refinery, India
- Kaltim Prima Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Finance - Indonesia
- Posco Energy - South Korea
- PetroVietnam Power Coal Import and Supply Company
- Indian Energy Exchange, India
- IEA Clean Coal Centre - UK
- The University of Queensland
- SMC Global Power, Philippines
- Economic Council, Georgia
- Indonesian Coal Mining Association
- Medco Energi Mining Internasional
- Cement Manufacturers Association - India
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Baramulti Group, Indonesia
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