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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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Thursday, 17 November 11
DRY BULK MARKET INCHES FORWARD AND INTO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market edged higher yesterday, on the back of stronger demand for Capesize vessels and general improvement of sentiment on most of the ...
Thursday, 17 November 11
KOMIPO INVITES BIDS FOR 500K MT OF COAL
COALspot.com - Korea Midland Power Co. Ltd.(KOMIPO) is inviting bids for the supply of 500,000 Metric Tons of minimum 5700 kcal/kg coal of NAR bases ...
Thursday, 17 November 11
INDONESIAN GOVERNMENT PLANS TO ISSUE MORATORIUM ON COAL MINING LICENSE
COALspot.com - Energy and mineral resources ministry is plans to issue a moratorium on the issuance of coal mining licenses, after the anti-graft co ...
Wednesday, 16 November 11
KRISHNAPATNAM PORT BECOMES DEEPEST DRAFT PORT IN INDIA
COALspot.com - Krishnapatnam Port in its quest to be the best port in India has increased its draft to 17.5 meters, according to E-Mail statement fr ...
Wednesday, 16 November 11
CHINA'S INDONESIA COAL IMPORTS RISE IN OCTOBER
COALspot.com: Indonesia, the world largest coal exporter, shipped 31,162,688 MT of coal in October 2011.
China was a largest importer of Indonesi ...
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- Gujarat Mineral Development Corp Ltd - India
- Indika Energy - Indonesia
- Barasentosa Lestari - Indonesia
- London Commodity Brokers - England
- Offshore Bulk Terminal Pte Ltd, Singapore
- Siam City Cement PLC, Thailand
- Coal and Oil Company - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Parry Sugars Refinery, India
- Ambuja Cements Ltd - India
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Price Waterhouse Coopers - Russia
- SMG Consultants - Indonesia
- Savvy Resources Ltd - HongKong
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Orica Mining Services - Indonesia
- Intertek Mineral Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- SN Aboitiz Power Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Therma Luzon, Inc, Philippines
- Riau Bara Harum - Indonesia
- Edison Trading Spa - Italy
- Australian Coal Association
- Bayan Resources Tbk. - Indonesia
- Energy Development Corp, Philippines
- GMR Energy Limited - India
- Madhucon Powers Ltd - India
- Vedanta Resources Plc - India
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Indogreen Group - Indonesia
- Bhushan Steel Limited - India
- Central Electricity Authority - India
- Global Business Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- European Bulk Services B.V. - Netherlands
- New Zealand Coal & Carbon
- Karbindo Abesyapradhi - Indoneisa
- Mercuria Energy - Indonesia
- Chamber of Mines of South Africa
- Meenaskhi Energy Private Limited - India
- Interocean Group of Companies - India
- Aboitiz Power Corporation - Philippines
- San Jose City I Power Corp, Philippines
- PowerSource Philippines DevCo
- Indian Oil Corporation Limited
- Directorate Of Revenue Intelligence - India
- Kohat Cement Company Ltd. - Pakistan
- Power Finance Corporation Ltd., India
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Agrawal Coal Company - India
- The University of Queensland
- Minerals Council of Australia
- The State Trading Corporation of India Ltd
- Mjunction Services Limited - India
- Essar Steel Hazira Ltd - India
- Renaissance Capital - South Africa
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Wilmar Investment Holdings
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- Bhatia International Limited - India
- Aditya Birla Group - India
- Coastal Gujarat Power Limited - India
- Kumho Petrochemical, South Korea
- Manunggal Multi Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Malabar Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Toyota Tsusho Corporation, Japan
- Wood Mackenzie - Singapore
- Merrill Lynch Commodities Europe
- Petron Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Jindal Steel & Power Ltd - India
- Ministry of Mines - Canada
- Medco Energi Mining Internasional
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- McConnell Dowell - Australia
- AsiaOL BioFuels Corp., Philippines
- Borneo Indobara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Eastern Energy - Thailand
- Grasim Industreis Ltd - India
- LBH Netherlands Bv - Netherlands
- GVK Power & Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Trasteel International SA, Italy
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- Port Waratah Coal Services - Australia
- Kartika Selabumi Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- South Luzon Thermal Energy Corporation
- Kideco Jaya Agung - Indonesia
- Ministry of Transport, Egypt
- Planning Commission, India
- Gujarat Sidhee Cement - India
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Dalmia Cement Bharat India
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- International Coal Ventures Pvt Ltd - India
- Makarim & Taira - Indonesia
- Rio Tinto Coal - Australia
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- Kaltim Prima Coal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Sree Jayajothi Cements Limited - India
- Ministry of Finance - Indonesia
- Banpu Public Company Limited - Thailand
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Standard Chartered Bank - UAE
- Energy Link Ltd, New Zealand
- Semirara Mining Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Kepco SPC Power Corporation, Philippines
- Star Paper Mills Limited - India
- Siam City Cement - Thailand
- VISA Power Limited - India
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- Singapore Mercantile Exchange
- Indian Energy Exchange, India
- Formosa Plastics Group - Taiwan
- ASAPP Information Group - India
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- Independent Power Producers Association of India
- ICICI Bank Limited - India
- PTC India Limited - India
- Marubeni Corporation - India
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Cement Manufacturers Association - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- India Bulls Power Limited - India
- Thiess Contractors Indonesia
- Altura Mining Limited, Indonesia
- Eastern Coal Council - USA
- Ceylon Electricity Board - Sri Lanka
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Heidelberg Cement - Germany
- GAC Shipping (India) Pvt Ltd
- Anglo American - United Kingdom
- Goldman Sachs - Singapore
- Lanco Infratech Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Latin American Coal - Colombia
- Metalloyd Limited - United Kingdom
- Tata Chemicals Ltd - India
- MS Steel International - UAE
- Economic Council, Georgia
- Bhoruka Overseas - Indonesia
- Karaikal Port Pvt Ltd - India
- Videocon Industries ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sakthi Sugars Limited - India
- Maheswari Brothers Coal Limited - India
- Timah Investasi Mineral - Indoneisa
- Mintek Dendrill Indonesia
- Coalindo Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Commonwealth Bank - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Mercator Lines Limited - India
- Sarangani Energy Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Electricity Generating Authority of Thailand
- Samtan Co., Ltd - South Korea
- Antam Resourcindo - Indonesia
- TeaM Sual Corporation - Philippines
- Sical Logistics Limited - India
- Holcim Trading Pte Ltd - Singapore
- Baramulti Group, Indonesia
- Pendopo Energi Batubara - Indonesia
- SMC Global Power, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bukit Makmur.PT - Indonesia
- Kobexindo Tractors - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- The Treasury - Australian Government
- Rashtriya Ispat Nigam Limited - India
- White Energy Company Limited
- Cigading International Bulk Terminal - Indonesia
- Larsen & Toubro Limited - India
- Vizag Seaport Private Limited - India
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