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Monday, 21 November 11
CAPESIZES DRIVE MARKET LOWER, ANALYSTS DIVIDED ON DRY BULK OUTLOOK IN THE LONG RUN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The dry bulk market ended the week on a sour note, with the industry’s benchmark heading downwards to 1,895 points, which represented a slight fall of 0.16%. Capesizes were the main drivers of this trend, with the market falling by 0.71%. Still, the rest of the market segments were higher, with Panamaxes leading the pack, with an increase of 1.38%. In a recent report, consultant analysts PriceWaterHouseCoopers (PwC) said that the size of the Capesize fleet is forecast to rocket over the next three years at the same time as demand growth for seaborne iron ore is set to stagnate. In its report ‘Dry Bulk Shipping - Capes of no Hope?’, PwC said that there are currently 1,200 Capesize vessels worldwide at a value of $45billion but it is estimated that a further 450 more are on order over the next three years which will flood the market. While some of these orders may be delayed or cancelled, the global order book implies there will be rapid growth in seaborne transport of iron ore and coal, the main commodities carried by Capesizes.
David Smith, Assistant Director, PwC Strategy said that "as in other sectors of the shipping industry, dry bulk market participants are assuming that the next decade will look very much like the last in terms of patterns of trade flow growth. This has led to continued orders of new vessels on the assumption that Chinese demand for iron ore will continue to grow rapidly, but our estimates show that growth will be much lower in the future. The reality is that the ‘expected’ growth demand for iron ore is unlikely to materialise given the already high rate of infrastructure investment in China. This will leave a substantially increased number of vessels chasing a broadly unchanged level of cargo, with negative implications for rates. The situation, he added, will be exacerbated by the vessel building programmes being undertaken by the large mining companies. This will decrease the amount of cargo available on the spot market, at a time when the fleet is increasing dramatically, said Mr. Smith.
He went on to mention that "while rates in the Capesize sector have improved over the last three months, we see this as a temporary respite. Continued overcapacity is likely to push rates back towards operating costs, creating significant pressure for owners trading in the spot market.” “The worry, he said, is that these pressures will not be confined to the ship owning community. Low rates over a prolonged period will make it difficult for ship owners to keep up payments to the banks which have made substantial investments in the sector. Major sources of shipping finance include the UK, Germany, Greece, and Scandinavia, with UK banks alone having loans of over $50bn to the shipping sector” concluded Mr. Smith.
Meanwhile, in a separate report, shipowner Golden Ocean said that “most analysts agree that the dry bulk market does not have a demand problem. Iron ore and coal imports to China and coal imports to India are expected to grow at a steady pace over the next 5 years. A lot of new iron ore capacity will enter the market from 2013 onwards, which could put a downward pressure on international iron prices. This should support the freight market due to expensive, low quality Chinese iron ore production. However, the order book for the remainder of this year and 2012 is still a major concern and is the main reason why the forward freight assessment (FFA) is in backwardation.Despite the positive development in the freight market, asset values dropped further during third quarter. A five year old Capesize was priced at $39 million while a newbuilding resale was priced at approximately $50 million. There is a lot of uncertainty related to asset values going forward, but we observe that more forecasters state that they see limited downside” said Golden Ocean.
Analyzing the trade patterns noted during the third quarter, the company mentioned that “the third quarter of 2011 was yet another quarter which surpassed most analysts’ expectations. Given the large order book with record high deliveries both this year and next, it has been difficult to imagine a demand scenario which was able to cope with supply growth and maintain utilization at levels giving owners of dry bulk tonnage decent returns. Capesizes experienced a steady rise from bleak levels. Iron ore is the main commodity carried by Capesizes and China increased its import by more than 17 percent compared to same quarter previous year. Coal imports to China increased by almost 30 percent year-onyear.
In addition, other Asian countries contributed to the strong demand growth. Korea increased its iron ore imports by more than 20 percent and the rebuilding of Japan after the March 2011 earthquake and tsunami also contributed positively. These high growth numbers alone are still not sufficient to explain a utilization rate, which averaged 85 percent last quarter. Congestion remains as a positive factor for owners and between six to eight percent of vessel capacity was tied up in the third quarter” said Golden Ocean.
It further mentioned that “Chinese coastal trade increased by 17 percent during the third quarter and more than 300 million tons of dry bulk commodities was carried off the Chinese coast. On an annual basis, this represents 20 million dwt capacity. We have not seen the same focus on slow steaming in dry bulk as in other segments. However, analysis shows that average speed of the sailing fleet has dropped by more than two knots since 2008. This is not due to an effort to improve market conditions but rather a function of high bunker prices and optimizing earnings. Still, the focus has to be on the order book. So far this year approximately 205 vessels in the Capesize segment have been delivered, but at the same time almost 70 vessels of the same size have been scrapped. Delivery ratio compared to the official order book remains below 70 percent” concluded Golden Ocean.
Source: Nikos Roussanoglou, Hellenic Shipping
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Thursday, 29 December 11
NEW VESSELS DELIVERED ARE FLOODING THE OCEANS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
As expected 2011 has been the year that newbuilding deliveries peaked and kept "flooding" the market, thus supressing freight rates and er ...
Tuesday, 27 December 11
MINERS MAKE CASE FOR RESUMING CONTRACT NEGOTIATIONS - THE JAKARTA POST
The Jakarta Post reported that, problems with the renegotiation of mining contracts in the country are far from over, as agreements on several cruci ...
Tuesday, 27 December 11
COAL SHIPMENT OF TIANJIN PORT REACHED 6.72 MLN TONNES IN NOVEMBER - STEEL HOME / HELLENIC SHIPPING
Tianjin port shipped 6.72 million tonnes of coal in November, decreasing 600,000 tonnes versus 7.32 million tonnes in October, while up 21.09% or 1. ...
Tuesday, 27 December 11
NEW CLAUSE PUBLISHED FOR SLOW STEAMING - BIMCO
Many owners and operators faced with high bunker prices are considering implementing slow steaming regimes to save fuel and to assist with capacity ...
Monday, 26 December 11
NEW EXPORT TAX PLAN GREETED WITH PRAISE AND CRITICISM - THE JAKARTA POST
The Jakarta Post, one of the Indonesia's leading english news paper reported that, both praise and criticism showered the government’s plan t ...
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Showing 4911 to 4915 news of total 6871 |
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- MS Steel International - UAE
- Sree Jayajothi Cements Limited - India
- Larsen & Toubro Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Indian Oil Corporation Limited
- Therma Luzon, Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- Star Paper Mills Limited - India
- Cigading International Bulk Terminal - Indonesia
- Maheswari Brothers Coal Limited - India
- Manunggal Multi Energi - Indonesia
- Thiess Contractors Indonesia
- Ministry of Mines - Canada
- PNOC Exploration Corporation - Philippines
- Lanco Infratech Ltd - India
- Semirara Mining Corp, Philippines
- CNBM International Corporation - China
- Sakthi Sugars Limited - India
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Energy Development Corp, Philippines
- Jaiprakash Power Ventures ltd
- Independent Power Producers Association of India
- Mintek Dendrill Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indogreen Group - Indonesia
- Central Electricity Authority - India
- Parry Sugars Refinery, India
- Mjunction Services Limited - India
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- Karaikal Port Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Mercuria Energy - Indonesia
- Merrill Lynch Commodities Europe
- Ind-Barath Power Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Bharathi Cement Corporation - India
- Energy Link Ltd, New Zealand
- Coastal Gujarat Power Limited - India
- VISA Power Limited - India
- Medco Energi Mining Internasional
- India Bulls Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- PowerSource Philippines DevCo
- Jorong Barutama Greston.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- Alfred C Toepfer International GmbH - Germany
- Global Coal Blending Company Limited - Australia
- Trasteel International SA, Italy
- Posco Energy - South Korea
- Sarangani Energy Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Intertek Mineral Services - Indonesia
- Singapore Mercantile Exchange
- Kalimantan Lumbung Energi - Indonesia
- Parliament of New Zealand
- Bhushan Steel Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- London Commodity Brokers - England
- Meralco Power Generation, Philippines
- Renaissance Capital - South Africa
- Bukit Baiduri Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- Makarim & Taira - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Aboitiz Power Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- Miang Besar Coal Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Grasim Industreis Ltd - India
- GVK Power & Infra Limited - India
- Deloitte Consulting - India
- Planning Commission, India
- SN Aboitiz Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Simpson Spence & Young - Indonesia
- Commonwealth Bank - Australia
- Kumho Petrochemical, South Korea
- Barasentosa Lestari - Indonesia
- Madhucon Powers Ltd - India
- Thai Mozambique Logistica
- European Bulk Services B.V. - Netherlands
- Indika Energy - Indonesia
- Bangladesh Power Developement Board
- TeaM Sual Corporation - Philippines
- Global Business Power Corporation, Philippines
- ICICI Bank Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Price Waterhouse Coopers - Russia
- Bhatia International Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Malabar Cements Ltd - India
- SMC Global Power, Philippines
- Africa Commodities Group - South Africa
- Sindya Power Generating Company Private Ltd
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Port Waratah Coal Services - Australia
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- IHS Mccloskey Coal Group - USA
- Mercator Lines Limited - India
- Eastern Energy - Thailand
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Pendopo Energi Batubara - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Metalloyd Limited - United Kingdom
- IEA Clean Coal Centre - UK
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- Bayan Resources Tbk. - Indonesia
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- McConnell Dowell - Australia
- Krishnapatnam Port Company Ltd. - India
- Australian Commodity Traders Exchange
- Holcim Trading Pte Ltd - Singapore
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- Economic Council, Georgia
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- The State Trading Corporation of India Ltd
- Kideco Jaya Agung - Indonesia
- Indian Energy Exchange, India
- Tamil Nadu electricity Board
- Coalindo Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Uttam Galva Steels Limited - India
- The Treasury - Australian Government
- The University of Queensland
- PetroVietnam Power Coal Import and Supply Company
- Kapuas Tunggal Persada - Indonesia
- Carbofer General Trading SA - India
- Globalindo Alam Lestari - Indonesia
- Global Green Power PLC Corporation, Philippines
- Coal and Oil Company - UAE
- Sojitz Corporation - Japan
- Heidelberg Cement - Germany
- Minerals Council of Australia
- Tata Chemicals Ltd - India
- Dalmia Cement Bharat India
- PTC India Limited - India
- Indonesian Coal Mining Association
- Wood Mackenzie - Singapore
- Banpu Public Company Limited - Thailand
- Petron Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- South Luzon Thermal Energy Corporation
- Maharashtra Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Vedanta Resources Plc - India
- Salva Resources Pvt Ltd - India
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Orica Mining Services - Indonesia
- Interocean Group of Companies - India
- Standard Chartered Bank - UAE
- Ambuja Cements Ltd - India
- Electricity Authority, New Zealand
- GMR Energy Limited - India
- Gujarat Sidhee Cement - India
- Baramulti Group, Indonesia
- Cement Manufacturers Association - India
- GAC Shipping (India) Pvt Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Agrawal Coal Company - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Antam Resourcindo - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Aditya Birla Group - India
- Savvy Resources Ltd - HongKong
- Riau Bara Harum - Indonesia
- Ministry of Finance - Indonesia
- Eastern Coal Council - USA
- Samtan Co., Ltd - South Korea
- Georgia Ports Authority, United States
- AsiaOL BioFuels Corp., Philippines
- Altura Mining Limited, Indonesia
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- ASAPP Information Group - India
- Goldman Sachs - Singapore
- Marubeni Corporation - India
- Bhoruka Overseas - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- Wilmar Investment Holdings
- Borneo Indobara - Indonesia
- SMG Consultants - Indonesia
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
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