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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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Tuesday, 13 September 11
CAPITAL COSTS OF INDIAN COAL MINING PROJECT - AN ANALYST VIEW
By Mr Dipesh Dipu, Director - Consulting (Mining), Deloitte Touche Tohmatsu India Private Limited
The coal mining sector that has been opened par ...
Tuesday, 13 September 11
INDONESIAS COAL SECTOR EYES 2012 BOOM - JG
The Jakarta Globe, Indonesian English language News paper reported that, Coal production is set to surge next year as coal miners bolster their busi ...
Tuesday, 13 September 11
DRY BULK RALLY MAINTAINS MOMENTUM AT START OF THE WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market kept its upward momentum at the start of the week, as the industry’s benchmark, the Baltic Dry Index (BDI) was up by 2.07% ...
Monday, 12 September 11
INDONESIAN GOVERNMENT HAS ALLOCATED MORE COAL FOR 2012
COALspot.com - Indonesian government has increased the domestic market obligation allocation to 82.07 million tons of coal for 2012, which is 4 perc ...
Saturday, 10 September 11
THE FREIGHT MARKET LIKELY TO BE FIRM NEXT WEEK - CAPT. REDDY
COALspot.com - The freight market continued the upward trend during last week with BDI crossing 1,800 points and closing at 1,838 points up by 5.63 ...
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- The Treasury - Australian Government
- Krishnapatnam Port Company Ltd. - India
- Minerals Council of Australia
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Anglo American - United Kingdom
- Ambuja Cements Ltd - India
- Indian Energy Exchange, India
- Energy Link Ltd, New Zealand
- Price Waterhouse Coopers - Russia
- Mercuria Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- AsiaOL BioFuels Corp., Philippines
- GAC Shipping (India) Pvt Ltd
- Kepco SPC Power Corporation, Philippines
- Deloitte Consulting - India
- Bharathi Cement Corporation - India
- Electricity Generating Authority of Thailand
- Posco Energy - South Korea
- Bayan Resources Tbk. - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Tamil Nadu electricity Board
- Intertek Mineral Services - Indonesia
- PTC India Limited - India
- Xindia Steels Limited - India
- Trasteel International SA, Italy
- SMC Global Power, Philippines
- GN Power Mariveles Coal Plant, Philippines
- ASAPP Information Group - India
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Global Business Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Alfred C Toepfer International GmbH - Germany
- Essar Steel Hazira Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Thai Mozambique Logistica
- Standard Chartered Bank - UAE
- Siam City Cement - Thailand
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- San Jose City I Power Corp, Philippines
- London Commodity Brokers - England
- Ministry of Mines - Canada
- Independent Power Producers Association of India
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Semirara Mining and Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Vedanta Resources Plc - India
- Simpson Spence & Young - Indonesia
- Goldman Sachs - Singapore
- LBH Netherlands Bv - Netherlands
- ICICI Bank Limited - India
- Riau Bara Harum - Indonesia
- Barasentosa Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Central Electricity Authority - India
- Rashtriya Ispat Nigam Limited - India
- Heidelberg Cement - Germany
- Karbindo Abesyapradhi - Indoneisa
- Maheswari Brothers Coal Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- The University of Queensland
- Bulk Trading Sa - Switzerland
- Siam City Cement PLC, Thailand
- The State Trading Corporation of India Ltd
- Indo Tambangraya Megah - Indonesia
- Mjunction Services Limited - India
- McConnell Dowell - Australia
- Semirara Mining Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Chamber of Mines of South Africa
- Borneo Indobara - Indonesia
- Port Waratah Coal Services - Australia
- Eastern Coal Council - USA
- Interocean Group of Companies - India
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Sindya Power Generating Company Private Ltd
- PetroVietnam Power Coal Import and Supply Company
- Central Java Power - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Edison Trading Spa - Italy
- Orica Mining Services - Indonesia
- Australian Coal Association
- Global Coal Blending Company Limited - Australia
- Coastal Gujarat Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Grasim Industreis Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- Antam Resourcindo - Indonesia
- GVK Power & Infra Limited - India
- Aboitiz Power Corporation - Philippines
- Wilmar Investment Holdings
- Indonesian Coal Mining Association
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Meralco Power Generation, Philippines
- Star Paper Mills Limited - India
- Videocon Industries ltd - India
- Petron Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Baramulti Group, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- Uttam Galva Steels Limited - India
- Savvy Resources Ltd - HongKong
- Bhoruka Overseas - Indonesia
- CIMB Investment Bank - Malaysia
- Georgia Ports Authority, United States
- Jindal Steel & Power Ltd - India
- Electricity Authority, New Zealand
- Salva Resources Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Coalindo Energy - Indonesia
- Malabar Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Tata Chemicals Ltd - India
- Ministry of Finance - Indonesia
- Madhucon Powers Ltd - India
- Altura Mining Limited, Indonesia
- Energy Development Corp, Philippines
- PowerSource Philippines DevCo
- Ministry of Transport, Egypt
- Meenaskhi Energy Private Limited - India
- Binh Thuan Hamico - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Bhushan Steel Limited - India
- Toyota Tsusho Corporation, Japan
- Attock Cement Pakistan Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Neyveli Lignite Corporation Ltd, - India
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- Lanco Infratech Ltd - India
- SN Aboitiz Power Inc, Philippines
- CNBM International Corporation - China
- Therma Luzon, Inc, Philippines
- South Luzon Thermal Energy Corporation
- Sarangani Energy Corporation, Philippines
- White Energy Company Limited
- Sical Logistics Limited - India
- Kobexindo Tractors - Indoneisa
- Samtan Co., Ltd - South Korea
- Dalmia Cement Bharat India
- Marubeni Corporation - India
- Indika Energy - Indonesia
- Sojitz Corporation - Japan
- Latin American Coal - Colombia
- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Carbofer General Trading SA - India
- International Coal Ventures Pvt Ltd - India
- Aditya Birla Group - India
- Merrill Lynch Commodities Europe
- India Bulls Power Limited - India
- Sree Jayajothi Cements Limited - India
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Commonwealth Bank - Australia
- Vizag Seaport Private Limited - India
- IEA Clean Coal Centre - UK
- Singapore Mercantile Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mintek Dendrill Indonesia
- Ceylon Electricity Board - Sri Lanka
- Economic Council, Georgia
- Pendopo Energi Batubara - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Gujarat Sidhee Cement - India
- Australian Commodity Traders Exchange
- Larsen & Toubro Limited - India
- VISA Power Limited - India
- MS Steel International - UAE
- Makarim & Taira - Indonesia
- Romanian Commodities Exchange
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- Parry Sugars Refinery, India
- Oldendorff Carriers - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Kaltim Prima Coal - Indonesia
- Karaikal Port Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Wood Mackenzie - Singapore
- Bangladesh Power Developement Board
- Kideco Jaya Agung - Indonesia
- European Bulk Services B.V. - Netherlands
- Sakthi Sugars Limited - India
- Medco Energi Mining Internasional
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