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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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Tuesday, 26 July 11
UT'S SALES COULD REACH TO 8000 UNITS BY THE END OF 2011
COALspot.com - Sales of Komatsu heavy equipment in the domestic market in the first half of 2011 rose 59 percent to 4333 units compared to the same ...
Monday, 25 July 11
INDONESIA STATE ELECTRICITY COMPANY HAS BURNED 19 MMT OF COAL FOR FIRST HALF OF 2011
COALspot.com - Indonesia's State Electricity Company and other IPPs have burned 19 million tons of coal for first half of this year said,Pamudji Nu ...
Monday, 25 July 11
AKR CORPORINDO TO PRODUCE 0.3 MMT OF COAL BY DECEMBER
COALspot.com - PT AKR Corporindo (AKRA) began producing coal from its mine in Muara Teweh, Central Kalimantan. The company is targeting to pro ...
Sunday, 24 July 11
AN INDIAN PORT SETS A WORLD RECORD FOR CONVENTIONAL COAL DISCHARGE
COALspot.com - Krishnapatnam Port has set a World record for discharging 106,171 tons of steam coal in just 24 hrs using the conventional unloading sy ...
Saturday, 23 July 11
FAR EAST /SE ASIA ROUTE GAINED US$ 3000 HIGHER THAN LAST WEEK - VISTAAR
COALspot.com - The BDI further softened to by 2.22 pct and closed at 1323 points. The Cape and Panamax index also softened and closed at 1841 points ...
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- Edison Trading Spa - Italy
- ASAPP Information Group - India
- Port Waratah Coal Services - Australia
- Savvy Resources Ltd - HongKong
- Gujarat Sidhee Cement - India
- Dalmia Cement Bharat India
- Bahari Cakrawala Sebuku - Indonesia
- Commonwealth Bank - Australia
- Intertek Mineral Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- TeaM Sual Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Deloitte Consulting - India
- Gujarat Mineral Development Corp Ltd - India
- ICICI Bank Limited - India
- Antam Resourcindo - Indonesia
- Krishnapatnam Port Company Ltd. - India
- European Bulk Services B.V. - Netherlands
- Kaltim Prima Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Minerals Council of Australia
- Wilmar Investment Holdings
- Central Electricity Authority - India
- OPG Power Generation Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Orica Mining Services - Indonesia
- Directorate Of Revenue Intelligence - India
- Miang Besar Coal Terminal - Indonesia
- Bhatia International Limited - India
- Romanian Commodities Exchange
- Latin American Coal - Colombia
- White Energy Company Limited
- Kepco SPC Power Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Toyota Tsusho Corporation, Japan
- Rio Tinto Coal - Australia
- New Zealand Coal & Carbon
- Wood Mackenzie - Singapore
- Tata Chemicals Ltd - India
- Ministry of Transport, Egypt
- Aboitiz Power Corporation - Philippines
- Xindia Steels Limited - India
- Meralco Power Generation, Philippines
- Cement Manufacturers Association - India
- GVK Power & Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Chettinad Cement Corporation Ltd - India
- Standard Chartered Bank - UAE
- Parliament of New Zealand
- SMC Global Power, Philippines
- Pendopo Energi Batubara - Indonesia
- Energy Link Ltd, New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Bulk Trading Sa - Switzerland
- Formosa Plastics Group - Taiwan
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- Economic Council, Georgia
- India Bulls Power Limited - India
- The Treasury - Australian Government
- MS Steel International - UAE
- Eastern Coal Council - USA
- Ambuja Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- Larsen & Toubro Limited - India
- International Coal Ventures Pvt Ltd - India
- Indogreen Group - Indonesia
- Power Finance Corporation Ltd., India
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- Ministry of Finance - Indonesia
- Essar Steel Hazira Ltd - India
- Mintek Dendrill Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- Bhushan Steel Limited - India
- SMG Consultants - Indonesia
- PTC India Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- VISA Power Limited - India
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- Trasteel International SA, Italy
- The State Trading Corporation of India Ltd
- PNOC Exploration Corporation - Philippines
- Siam City Cement PLC, Thailand
- Sinarmas Energy and Mining - Indonesia
- The University of Queensland
- Neyveli Lignite Corporation Ltd, - India
- Kumho Petrochemical, South Korea
- Simpson Spence & Young - Indonesia
- Mjunction Services Limited - India
- Banpu Public Company Limited - Thailand
- Sojitz Corporation - Japan
- Manunggal Multi Energi - Indonesia
- Aditya Birla Group - India
- Vizag Seaport Private Limited - India
- Holcim Trading Pte Ltd - Singapore
- Tamil Nadu electricity Board
- Videocon Industries ltd - India
- Globalindo Alam Lestari - Indonesia
- Posco Energy - South Korea
- Australian Coal Association
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Bayan Resources Tbk. - Indonesia
- Coastal Gujarat Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coal and Oil Company - UAE
- Indian Energy Exchange, India
- PowerSource Philippines DevCo
- Siam City Cement - Thailand
- Baramulti Group, Indonesia
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Australian Commodity Traders Exchange
- Malabar Cements Ltd - India
- Central Java Power - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Parry Sugars Refinery, India
- Interocean Group of Companies - India
- Timah Investasi Mineral - Indoneisa
- Orica Australia Pty. Ltd.
- Bukit Makmur.PT - Indonesia
- Electricity Authority, New Zealand
- CNBM International Corporation - China
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Therma Luzon, Inc, Philippines
- McConnell Dowell - Australia
- TNB Fuel Sdn Bhd - Malaysia
- PetroVietnam Power Coal Import and Supply Company
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Coalindo Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Bharathi Cement Corporation - India
- Marubeni Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Lanco Infratech Ltd - India
- Global Business Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- GMR Energy Limited - India
- Jindal Steel & Power Ltd - India
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- Cigading International Bulk Terminal - Indonesia
- Planning Commission, India
- Samtan Co., Ltd - South Korea
- Jorong Barutama Greston.PT - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Uttam Galva Steels Limited - India
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- Bhoruka Overseas - Indonesia
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- Madhucon Powers Ltd - India
- Grasim Industreis Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Development Corp, Philippines
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Kalimantan Lumbung Energi - Indonesia
- Straits Asia Resources Limited - Singapore
- Mercator Lines Limited - India
- Heidelberg Cement - Germany
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- Semirara Mining Corp, Philippines
- Africa Commodities Group - South Africa
- Karaikal Port Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Salva Resources Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- South Luzon Thermal Energy Corporation
- Ind-Barath Power Infra Limited - India
- Altura Mining Limited, Indonesia
- Thai Mozambique Logistica
- Metalloyd Limited - United Kingdom
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- Sree Jayajothi Cements Limited - India
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Goldman Sachs - Singapore
- SN Aboitiz Power Inc, Philippines
- Singapore Mercantile Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Agrawal Coal Company - India
- Independent Power Producers Association of India
- GAC Shipping (India) Pvt Ltd
- Indonesian Coal Mining Association
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