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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 scrapping activity, as observed during the course of 2011. According to the latest BIMCO report on 2012, a large part of this increase in demand could come from India and its coal needs. The report said that "the year 2011 had barely started before a series of unforeseen events took place across the globe. Most of them affected dry bulk shipping negatively and the large Capesize vessels were particularly under pressure. Amongst the events were the flooding in Australia and South Africa, the triple disaster in Japan and the “Arab Spring” that also affected the supply of oil into Europe.
Half a year down the road, during which many Capesize vessels had earned less than any other dry bulk vessel size, the unexpected happened again. Strong demand for iron ore and coal from China and the recovering Japan, sourced from Brazil and Australia, ignited freight rates for Capesize vessels. A tight tonnage situation in the Atlantic basin combined with increased congestion in loading and discharging ports pushed average rates above USD 30,000 per day.
A far cry from the peaks of the super cycle, but surely an indication of the peak levels we have in sight for the near- to mid-term future as the supply side remains a considerable burden for the industry. The demand side is set to be relatively stable in 2012 although it’s likely to grow somewhat slower than in 2011 – at least in volume terms. Overall iron ore demand is likely to slow. Still, a lower world market price as compared to the domestic costs of mining it within China holds the key to provide positive demand shocks for this valuable steel ingredient. Growing demand for thermal coal from large Asian consumers is said to be a steady demand driver" said BIMCO.
In a separate research report on the outlook of the dry bulk industry, DVB Bank said that the current dry bulk fleet now stands at 8,877 vessels (585.1mio dwt). The average age of the fleet is about 12 years and 59.1% of the fleet is less than 10 years of age. In addition, the average age of vessels less than 10 years old is merely 2.8 years – a very young fleet. Similarly, the orderbook stands at 2,371 vessels (196.3mio dwt) which equates to 33.6% of the current fleet. In dwt terms, large Capes constitute the largest portion of the current fleet while Panamax size vessels have the largest Orderbook. ULBC size range is expanding substantially. So far, three of the 34 Vale ULBCs of 400K+ dwt have delivered.DVB Bank said in its analysis that if the remaining 31 vessels actually deliver, this will have a huge negative impact on all large Cape asset values as well as T/C rates and impact earnings of other Sub-Sectors as well.
Looking at deliveries, a total of 366 vessels of 28.3 million dwt are still headed towards delivery, according to figures up to November of 2011. These vessels represent 14.4% of the orderbook. Given that for the most part these weren't expected to be delivered within 2011, the researcher said that they will be rolled over to 2012. So, it draws the conclusion that "even Even with 40% delays due to slippage, postponement and cancellation, we are poised to cross the 100mio dwt mark this year. In 2012, some 1,431 vessels (121.6mio dwt) are scheduled for delivery, which is about 62% of the current orderbook" said DVB Bank.
In total the dry bulk cargo demand is forecast to rise to approximatly 3.7 billion tons this year. But, as DVB states, the level of the orderbook is too much for it to be absorbed without problems and downward pressure both on ship values and freight rates. "Although scrapping picked up in 2011 to 21.4mio dwt (334 vessels) as of November, this figure is merely 3.5% of the existing fleet" said DVB Bank. It concluded that the vessels which were ordered at the peak of the market back in 2007-2008 should add to distressed asset sales, as their owners won't be able to repay them without huge losses. In essence, the researcher said that the current slowdown will see many ship owners out of the market and bankrupt, due to cash flow problems, as at the moment, they don't have the necessary cash reserves to survive the downturn, like they did back in 2008.
BIMCO's advice towards dry bulk ship owners they should expect the unexpected, as has been the lesson learned. "Maybe even India will begin to influence the market as a significant importer. This would fulfil the prophecy and release a vast potential that has been simmering for a very long time and provide a much-needed second major demand driver. Supplementing China as the dominant factor in the market would create a more sustainable freight market going forward. However, this will not happen in just one year; moreover it appears destined to remain a long and dusty road for several years to come. An optimist would surely name India as the best thing that could happen to the dry bulk shipping industry. In the meantime volatile iron ore exports and strong demand for thermal coal is likely to characterise India’s contribution to the dry bulk markets" concluded the organization.
Source: Nikos Roussanoglou, Hellenic Shipping
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Thursday, 20 October 11
BRACKEN INTERNATIONAL MINING LISTS ON FRANKFURT STOCK EXCHANGE
Press Release - Bracken International Mining (Code:1BM) listed on the Deutsche Börse’s Frankfurt Stock Exchange today at €1.00 with ...
Thursday, 20 October 11
CAPESIZES, SUPRAMAXES LEAD GAINS FOR DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Struggling to find additional support, but still managing to post gains, the dry bulk market has stabilized itself on higher levels again yesterday, ...
Wednesday, 19 October 11
METALLURGICAL COAL PRICES TO DROP BELOW US$240/TONNE - WOOD MACKENZIE
Wood Mackenzie Says Metallurgical Coal Prices to Drop Below US$240/tonne by Q4 2012 But Long-term Demand Fundamentals Remain Robust
Wood Mackenzi ...
Wednesday, 19 October 11
SUPRAMAX MARKET WAS VERY FIRM LAST WEEK - BRS
With all sectors contributing positively, the BDI ended the week at 2,173 points (+8.6%), its highest level so far in 2011. The BCI stood at 3,587 ( ...
Wednesday, 19 October 11
ADARO ACQUIRES BUKIT ENIM ENERGI - INSIDER STORIES
Insider Stories reported that, Coal miner PT Adaro Energy Tbk, via its subsidiary dubbed PT Alam Tri Abadi, today revealed a 46% stake takeover of a ...
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- Electricity Generating Authority of Thailand
- Bhushan Steel Limited - India
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sical Logistics Limited - India
- Straits Asia Resources Limited - Singapore
- Sindya Power Generating Company Private Ltd
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- White Energy Company Limited
- International Coal Ventures Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- MS Steel International - UAE
- GVK Power & Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Grasim Industreis Ltd - India
- TeaM Sual Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- LBH Netherlands Bv - Netherlands
- Eastern Energy - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Ambuja Cements Ltd - India
- Altura Mining Limited, Indonesia
- Goldman Sachs - Singapore
- Singapore Mercantile Exchange
- Trasteel International SA, Italy
- Directorate General of MIneral and Coal - Indonesia
- Indian Energy Exchange, India
- Banpu Public Company Limited - Thailand
- CNBM International Corporation - China
- Semirara Mining and Power Corporation, Philippines
- Aditya Birla Group - India
- Kumho Petrochemical, South Korea
- Renaissance Capital - South Africa
- Indo Tambangraya Megah - Indonesia
- Carbofer General Trading SA - India
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Medco Energi Mining Internasional
- Bayan Resources Tbk. - Indonesia
- London Commodity Brokers - England
- Siam City Cement - Thailand
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- Bukit Makmur.PT - Indonesia
- SN Aboitiz Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Central Electricity Authority - India
- The Treasury - Australian Government
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Sarangani Energy Corporation, Philippines
- Makarim & Taira - Indonesia
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- PNOC Exploration Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Tamil Nadu electricity Board
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- Essar Steel Hazira Ltd - India
- VISA Power Limited - India
- Indogreen Group - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Iligan Light & Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Ministry of Transport, Egypt
- Chettinad Cement Corporation Ltd - India
- Orica Australia Pty. Ltd.
- Neyveli Lignite Corporation Ltd, - India
- Bangladesh Power Developement Board
- Electricity Authority, New Zealand
- Antam Resourcindo - Indonesia
- Bhatia International Limited - India
- Marubeni Corporation - India
- Ministry of Mines - Canada
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kalimantan Lumbung Energi - Indonesia
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- Tata Chemicals Ltd - India
- Africa Commodities Group - South Africa
- Energy Link Ltd, New Zealand
- Bukit Baiduri Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Therma Luzon, Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Indika Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Barasentosa Lestari - Indonesia
- Borneo Indobara - Indonesia
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- Interocean Group of Companies - India
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- Independent Power Producers Association of India
- Parry Sugars Refinery, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bharathi Cement Corporation - India
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- The University of Queensland
- Simpson Spence & Young - Indonesia
- Price Waterhouse Coopers - Russia
- Krishnapatnam Port Company Ltd. - India
- ICICI Bank Limited - India
- Economic Council, Georgia
- Standard Chartered Bank - UAE
- Meralco Power Generation, Philippines
- San Jose City I Power Corp, Philippines
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Metalloyd Limited - United Kingdom
- The State Trading Corporation of India Ltd
- Australian Commodity Traders Exchange
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Wilmar Investment Holdings
- Vizag Seaport Private Limited - India
- Wood Mackenzie - Singapore
- Central Java Power - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Globalindo Alam Lestari - Indonesia
- Bulk Trading Sa - Switzerland
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Sojitz Corporation - Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parliament of New Zealand
- Binh Thuan Hamico - Vietnam
- Star Paper Mills Limited - India
- Edison Trading Spa - Italy
- ASAPP Information Group - India
- Maheswari Brothers Coal Limited - India
- Riau Bara Harum - Indonesia
- Intertek Mineral Services - Indonesia
- Coalindo Energy - Indonesia
- Planning Commission, India
- Aboitiz Power Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
- Thai Mozambique Logistica
- GN Power Mariveles Coal Plant, Philippines
- SMC Global Power, Philippines
- Uttam Galva Steels Limited - India
- Jindal Steel & Power Ltd - India
- New Zealand Coal & Carbon
- Alfred C Toepfer International GmbH - Germany
- McConnell Dowell - Australia
- Minerals Council of Australia
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- Deloitte Consulting - India
- Karbindo Abesyapradhi - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Commonwealth Bank - Australia
- Formosa Plastics Group - Taiwan
- IEA Clean Coal Centre - UK
- Latin American Coal - Colombia
- Australian Coal Association
- Dalmia Cement Bharat India
- Ind-Barath Power Infra Limited - India
- India Bulls Power Limited - India
- Romanian Commodities Exchange
- Vedanta Resources Plc - India
- Mercator Lines Limited - India
- Oldendorff Carriers - Singapore
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Mintek Dendrill Indonesia
- Global Business Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- Larsen & Toubro Limited - India
- Sree Jayajothi Cements Limited - India
- PTC India Limited - India
- Kepco SPC Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Malabar Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- Energy Development Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Manunggal Multi Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Xindia Steels Limited - India
- CIMB Investment Bank - Malaysia
- PetroVietnam Power Coal Import and Supply Company
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Madhucon Powers Ltd - India
- Thiess Contractors Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
- Videocon Industries ltd - India
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