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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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Monday, 12 December 11
DRY BULK MARKET LOOKING FOR BALANCE AS WE ENTER 2012 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
During the past few months, freight rates for dry bulk carriers, especially Capesizes have increased significantly, providing ship owners with a muc ...
Sunday, 11 December 11
THE PANAMAX INDEX ENDED ON POSITIVE DIRECTION - VISTAAR
COALspot.com - The BDI and Cape index continued the upward trend this week also with BDI up by 3.00 pct closing at 1,922 points and Cape index up by ...
Saturday, 10 December 11
MAHAKAM RIVER RESUMES COAL TRANSPORTATION
COALspot.com - East Kalimantan local government has resumed limited coal barging through Mahakam River after two weeks of suspension following the c ...
Friday, 09 December 11
DRY BULK MARKET REBOUNDS ON HEALTHIER DEMAND OUTLOOK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market edged forward yesterday, at the highest rate of the past couple of weeks, as a result of stonger iron ore demand, backed by lowe ...
Thursday, 08 December 11
INDIA MAY SEE 41% ANNUAL GROWTH OF ITS COAL DEMAND DURING THE NEXT 5 YEARS - ICAP SHIPPING
India’s Ministry of Coal expects that India’s coal demand may face an annual 41% rise during the next 5 years, while its coal deficit is ...
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Transport, Egypt
- Globalindo Alam Lestari - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- Trasteel International SA, Italy
- European Bulk Services B.V. - Netherlands
- Renaissance Capital - South Africa
- Indo Tambangraya Megah - Indonesia
- The State Trading Corporation of India Ltd
- Bharathi Cement Corporation - India
- Global Business Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Kumho Petrochemical, South Korea
- Metalloyd Limited - United Kingdom
- Savvy Resources Ltd - HongKong
- Jindal Steel & Power Ltd - India
- Petron Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
- Marubeni Corporation - India
- Bukit Baiduri Energy - Indonesia
- Siam City Cement - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Ceylon Electricity Board - Sri Lanka
- Power Finance Corporation Ltd., India
- Central Electricity Authority - India
- The University of Queensland
- The Treasury - Australian Government
- Xindia Steels Limited - India
- Commonwealth Bank - Australia
- Manunggal Multi Energi - Indonesia
- Carbofer General Trading SA - India
- Therma Luzon, Inc, Philippines
- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Dalmia Cement Bharat India
- Oldendorff Carriers - Singapore
- Makarim & Taira - Indonesia
- Coastal Gujarat Power Limited - India
- CNBM International Corporation - China
- Thai Mozambique Logistica
- Star Paper Mills Limited - India
- Sree Jayajothi Cements Limited - India
- Heidelberg Cement - Germany
- Orica Australia Pty. Ltd.
- Price Waterhouse Coopers - Russia
- Mjunction Services Limited - India
- Mintek Dendrill Indonesia
- PTC India Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Directorate Of Revenue Intelligence - India
- Minerals Council of Australia
- Central Java Power - Indonesia
- Economic Council, Georgia
- Electricity Authority, New Zealand
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- Samtan Co., Ltd - South Korea
- Chamber of Mines of South Africa
- Baramulti Group, Indonesia
- Ministry of Finance - Indonesia
- Bhushan Steel Limited - India
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- White Energy Company Limited
- Neyveli Lignite Corporation Ltd, - India
- Binh Thuan Hamico - Vietnam
- Deloitte Consulting - India
- Thiess Contractors Indonesia
- SMG Consultants - Indonesia
- Ambuja Cements Ltd - India
- Edison Trading Spa - Italy
- Bukit Makmur.PT - Indonesia
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- Borneo Indobara - Indonesia
- Malabar Cements Ltd - India
- Vizag Seaport Private Limited - India
- Ministry of Mines - Canada
- Mercator Lines Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Bangladesh Power Developement Board
- Planning Commission, India
- Iligan Light & Power Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Eastern Energy - Thailand
- Standard Chartered Bank - UAE
- Meralco Power Generation, Philippines
- Indian Oil Corporation Limited
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- Barasentosa Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- San Jose City I Power Corp, Philippines
- Attock Cement Pakistan Limited
- Maheswari Brothers Coal Limited - India
- Ind-Barath Power Infra Limited - India
- Rashtriya Ispat Nigam Limited - India
- Tamil Nadu electricity Board
- Miang Besar Coal Terminal - Indonesia
- Goldman Sachs - Singapore
- Sical Logistics Limited - India
- Coalindo Energy - Indonesia
- ICICI Bank Limited - India
- Pendopo Energi Batubara - Indonesia
- Videocon Industries ltd - India
- Kepco SPC Power Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Riau Bara Harum - Indonesia
- Tata Chemicals Ltd - India
- Mercuria Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Aboitiz Power Corporation - Philippines
- LBH Netherlands Bv - Netherlands
- Wood Mackenzie - Singapore
- Uttam Galva Steels Limited - India
- Independent Power Producers Association of India
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Antam Resourcindo - Indonesia
- Parry Sugars Refinery, India
- GAC Shipping (India) Pvt Ltd
- Semirara Mining Corp, Philippines
- Salva Resources Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- McConnell Dowell - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- PowerSource Philippines DevCo
- Bhoruka Overseas - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sindya Power Generating Company Private Ltd
- Merrill Lynch Commodities Europe
- Jaiprakash Power Ventures ltd
- Eastern Coal Council - USA
- Banpu Public Company Limited - Thailand
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Interocean Group of Companies - India
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- Bulk Trading Sa - Switzerland
- Global Coal Blending Company Limited - Australia
- Sinarmas Energy and Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Coal and Oil Company - UAE
- Sojitz Corporation - Japan
- Intertek Mineral Services - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Orica Mining Services - Indonesia
- Rio Tinto Coal - Australia
- GMR Energy Limited - India
- Aditya Birla Group - India
- Indika Energy - Indonesia
- Cement Manufacturers Association - India
- Timah Investasi Mineral - Indoneisa
- Essar Steel Hazira Ltd - India
- Sarangani Energy Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Latin American Coal - Colombia
- Gujarat Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Formosa Plastics Group - Taiwan
- Straits Asia Resources Limited - Singapore
- AsiaOL BioFuels Corp., Philippines
- Parliament of New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Sidhee Cement - India
- VISA Power Limited - India
- CIMB Investment Bank - Malaysia
- Agrawal Coal Company - India
- IEA Clean Coal Centre - UK
- Lanco Infratech Ltd - India
- Medco Energi Mining Internasional
- Indogreen Group - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Chettinad Cement Corporation Ltd - India
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- Posco Energy - South Korea
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Singapore Mercantile Exchange
- Billiton Holdings Pty Ltd - Australia
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Leighton Contractors Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Madhucon Powers Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- SN Aboitiz Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Bhatia International Limited - India
- Anglo American - United Kingdom
- Kideco Jaya Agung - Indonesia
- Sakthi Sugars Limited - India
- Australian Coal Association
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