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Thursday, 15 December 11
DRY BULK RATES TO REMAIN AT CURRENT LEVELS FOR THE MOST PART IN THE COMING MONTHS SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 In its latest research note, BIMCO said that the Capesize Time Charter Average will remain at USD 20,000-30,000 per day but the tonnage oversupply will eventually hit back.
Meanwhile, it reiterated its forecast on the Panamax and Supramax freight rates that are likely to stay put in the USD 13,000-17,000 per day interval. Handysize rates are expected to gain traction and return to the USD 9,000-13,000 per day interval.According to BIMCO’s analysis “despite the the supply-side pressure, we put our money on black and forecast that Capesize rates are going to be supported by lower iron ore prices and coal demand for Winter heating in the coming months, thus we expect freight rates to stay sensitive to iron ore price developments but above USD 20,000 per day. A key observation from BIMCO is that we believe mining companies will prefer to sell this important steel production ingredient in larger volumes rather than higher prices, as long as China appears ready to purchase.
In order to deliver the support needed to keep rates elevated, Chinese iron ore imports will need a level of 61.2 million tonnes in both November and December, which in turn will bring the annual total import growth to +10% y-o-y. The supporting argument that must trump the negative impact from high stockpiles and slower steel production is the pricing game. China has built a firm reputation for playing the commodity markets well.
Looking beyond the Capesize fleet and into 2012, the smaller-in-size segments are going to experience a healthy slowdown in new deliveries. Right now, deliveries are estimated at 80 million DWT – equal to a fleet growth of 11.4%; a number that is likely to get slightly inflated by vessels that were set for December delivery but end up being January deliveries instead. A potential upside may also come from Russia, if they decide to impose a ban on grain exports to stop excessive outflow of the foodstuff. This will lead to longer hauls, as African and Middle Eastern importers will have to look for alternative sources potentially further away. Should they go to the most likely exporters, Australia or Argentina, the impact on the freight markets will be most significant” said BIMCO.
On the supply side, BIMCO’s Chief Shipping Analyst, Peter Sand said that the active fleet has grown by 12.9% so far in 2011, caused by delivery of 1,050 new vessels equal to 86 million DWT, offset by 20.9 million DWT being demolished. “We expect total demolition in 2011 to end at 23.5 million DWT as the activity is slowing down. Total inflow of tonnage in 2011 is going to hit 100 million DWT, surpassing 2010 inflow of new tonnage by as much as 20%. The fleet is about to grow by 14.5%, which is the highest level ever in net and gross terms.
By early December, 230 new Capesize vessels (+170,000 DWT) were delivered. That’s more than one new vessel every second day throughout the year. In total, BIMCO expects 245 new Capesizes will have been delivered in 2011 before New Year’s Eve. The projections for next year anticipates delivery of another 220 new Capesizes. Strong inflow of new tonnage and high amounts of recycled tonnage have brought the average age of the Capesize fleet down to 11.5 years from 13 at the start of the year. The level of new contracts dropped month by month as the year passed by. From close to 5 million DWT contracted in January, only 0.8 million DWT was contracted in October. This is a 29-months’ low level – an extremely positive development that bodes well for this segment of the industry, especially when seen in the perspective of the rise in freight rates during the past few months and owners not queuing up to place new orders” said Sand.
Just two months ago BIMCO released an analysis entitled: “Record recycling activity stirs optimism in dry bulk”. By that time, the potential of reaching 25 million DWT was within reach if high demolition rates were kept attractive to owners and rates did not improve significantly. Today, the “bull run” towards the recycling yards is over, demolition rates have come down in the Far East and Bangladesh has stopped taking in more new business. Meanwhile, average freight rates have stayed more or less unchanged, near year-high levels, making demolition activity cool down significantly.
On the demand side, BIMCO said that “while the workhorses in the Panamax and Supramax segments performed in line with the BIMCO forecast – hovering around USD 15,000 per day – Handysize vessels performed slightly worse than expected, tipping their toes just South of the USD 10,000 per day. On the very positive side, Capesize rates tackled the dip at end-October to see rates soaring again in November. The development is driven purely by vessels chartered to haul iron ore to China. Coming down from 28 chartered ships a week by mid-October, weekly activity dropped to 11 per week by the end of October, due to falling steel prices. However, activity rebounded strongly throughout November as iron ore prices fell rather significantly too to offset the negative impact from falling steel prices, according to Commodore Research. This development is mirrored perfectly in average time charter rates.
Export prospects for Russian wheat are still strong and building. This is evident from recent very strong sales following solid demand for vast volumes and competitively priced wheat, despite appreciation of the Rouble against other currencies. However, there are concerns arising in the wake of the success that Russia will impose grain export restrictions should total grain exports reach 24 million tons. In an attempt to export before restrictions are imposed, traders and producers are shipping a lot of output to ports, creating railway jams. Ironically, these jams lowered the pace of exports in October.
The Panamax and Supramax rates in the Atlantic basin have found only little support in the wheat and grains coming into the market via the US Gulf. Rates have come off over the past months, but should firm slowly as demand for thermal coal picks up as we head into the Winter in the northern hemisphere.
Overall demand in 2011 is likely to end at 6% y-o-y, while demand growth in 2012 is looking a bit softer at 4% y-o-y” concluded BIMCO.
Source: Nikos Roussanoglou, Hellenic Shipping
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Wednesday, 11 January 12
NEWBUILDING ORDERS DECLINE, AS SHIP OWNERS REALIZE OVERSUPPLY WILL "KILL" THEM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With 2012 now underway, it will be rather interesting to see how ship owners will play the "newbuilding ordering" card to their favor, as ...
Tuesday, 10 January 12
THE 4TH DEEPWATER ASIA CONGRESS 2012 WILL KICK OFF ON MAY 23 - 25
Press release - Based on the past three years’ success, SZ & W Group is excited to announce the 4th Deepwater Asia Congress will be held o ...
Monday, 09 January 12
2012: WHAT WILL IT BRING FOR THE DRY BULK MARKET? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A further increase in dry bulk demand could be the remedy for most of the industry's oversupply issues, together of course with the high level of s ...
Sunday, 08 January 12
ICICI OUTLOOK ON INDIAN POWER, MINING,CEMENT, AND SHIPPING SECTORS PERFORMANCE IN 2012
Broking firm, ICICIdirect (India) has come out with report on sectors outlook for 2012. IRIS has collated key highlights for each sector from ...
Sunday, 08 January 12
SUPRAMAX DELIVERY SOUTH CHINA FOR TRIPS VIA INDONESIA WERE REPORTED AROUND $ 7000 PER DAY - VISTAAR
Wish You a Very Happy and Prosperous New year 2012.
COALspot.com - The last report by us was on 16th Dec 2011 and because of holidays this would ...
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- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Uttam Galva Steels Limited - India
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- Ceylon Electricity Board - Sri Lanka
- Toyota Tsusho Corporation, Japan
- Maharashtra Electricity Regulatory Commission - India
- Alfred C Toepfer International GmbH - Germany
- Holcim Trading Pte Ltd - Singapore
- Petron Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Kartika Selabumi Mining - Indonesia
- Maheswari Brothers Coal Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Economic Council, Georgia
- Tamil Nadu electricity Board
- Riau Bara Harum - Indonesia
- Simpson Spence & Young - Indonesia
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Timah Investasi Mineral - Indoneisa
- Anglo American - United Kingdom
- PowerSource Philippines DevCo
- Parry Sugars Refinery, India
- Indian Energy Exchange, India
- Global Green Power PLC Corporation, Philippines
- Africa Commodities Group - South Africa
- Bangladesh Power Developement Board
- San Jose City I Power Corp, Philippines
- Indogreen Group - Indonesia
- Baramulti Group, Indonesia
- AsiaOL BioFuels Corp., Philippines
- Star Paper Mills Limited - India
- Indo Tambangraya Megah - Indonesia
- Sical Logistics Limited - India
- Wilmar Investment Holdings
- Kepco SPC Power Corporation, Philippines
- Xindia Steels Limited - India
- The University of Queensland
- Savvy Resources Ltd - HongKong
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Sojitz Corporation - Japan
- Intertek Mineral Services - Indonesia
- Kumho Petrochemical, South Korea
- Globalindo Alam Lestari - Indonesia
- Meralco Power Generation, Philippines
- MS Steel International - UAE
- Chettinad Cement Corporation Ltd - India
- Thai Mozambique Logistica
- South Luzon Thermal Energy Corporation
- Kalimantan Lumbung Energi - Indonesia
- Barasentosa Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- ICICI Bank Limited - India
- Planning Commission, India
- Parliament of New Zealand
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- LBH Netherlands Bv - Netherlands
- Malabar Cements Ltd - India
- Medco Energi Mining Internasional
- Bulk Trading Sa - Switzerland
- Pendopo Energi Batubara - Indonesia
- Metalloyd Limited - United Kingdom
- Gujarat Mineral Development Corp Ltd - India
- SMC Global Power, Philippines
- Videocon Industries ltd - India
- Georgia Ports Authority, United States
- Eastern Coal Council - USA
- Global Business Power Corporation, Philippines
- Coal and Oil Company - UAE
- Rio Tinto Coal - Australia
- Indika Energy - Indonesia
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- Australian Coal Association
- Bahari Cakrawala Sebuku - Indonesia
- Bayan Resources Tbk. - Indonesia
- Minerals Council of Australia
- Neyveli Lignite Corporation Ltd, - India
- Bhushan Steel Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Ambuja Cements Ltd - India
- Jaiprakash Power Ventures ltd
- CIMB Investment Bank - Malaysia
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- Ind-Barath Power Infra Limited - India
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- Jorong Barutama Greston.PT - Indonesia
- Romanian Commodities Exchange
- Electricity Authority, New Zealand
- Sree Jayajothi Cements Limited - India
- Goldman Sachs - Singapore
- Commonwealth Bank - Australia
- New Zealand Coal & Carbon
- Energy Development Corp, Philippines
- Mintek Dendrill Indonesia
- Sakthi Sugars Limited - India
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate Of Revenue Intelligence - India
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Therma Luzon, Inc, Philippines
- The Treasury - Australian Government
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- London Commodity Brokers - England
- Krishnapatnam Port Company Ltd. - India
- Gujarat Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- Chamber of Mines of South Africa
- VISA Power Limited - India
- Miang Besar Coal Terminal - Indonesia
- Posco Energy - South Korea
- Thiess Contractors Indonesia
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- Wood Mackenzie - Singapore
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- Bukit Baiduri Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Aboitiz Power Corporation - Philippines
- Deloitte Consulting - India
- Vijayanagar Sugar Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Mercuria Energy - Indonesia
- Antam Resourcindo - Indonesia
- Marubeni Corporation - India
- McConnell Dowell - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- International Coal Ventures Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Trasteel International SA, Italy
- Essar Steel Hazira Ltd - India
- Heidelberg Cement - Germany
- Makarim & Taira - Indonesia
- Renaissance Capital - South Africa
- Kideco Jaya Agung - Indonesia
- Binh Thuan Hamico - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- European Bulk Services B.V. - Netherlands
- Coastal Gujarat Power Limited - India
- Gujarat Sidhee Cement - India
- Aditya Birla Group - India
- Power Finance Corporation Ltd., India
- PNOC Exploration Corporation - Philippines
- Ministry of Finance - Indonesia
- TeaM Sual Corporation - Philippines
- Bharathi Cement Corporation - India
- Interocean Group of Companies - India
- Larsen & Toubro Limited - India
- PTC India Limited - India
- Orica Australia Pty. Ltd.
- Bukit Makmur.PT - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Orica Mining Services - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bhoruka Overseas - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indonesian Coal Mining Association
- Cigading International Bulk Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- Straits Asia Resources Limited - Singapore
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Oldendorff Carriers - Singapore
- Global Coal Blending Company Limited - Australia
- Lanco Infratech Ltd - India
- Central Electricity Authority - India
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- SMG Consultants - Indonesia
- Mercator Lines Limited - India
- Kaltim Prima Coal - Indonesia
- Ministry of Mines - Canada
- White Energy Company Limited
- Manunggal Multi Energi - Indonesia
- Salva Resources Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Meenaskhi Energy Private Limited - India
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- IEA Clean Coal Centre - UK
- Coalindo Energy - Indonesia
- Grasim Industreis Ltd - India
- Independent Power Producers Association of India
- Billiton Holdings Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Karbindo Abesyapradhi - Indoneisa
- India Bulls Power Limited - India
- Vizag Seaport Private Limited - India
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