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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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Wednesday, 28 January 15
CAPES CONTINUED THEIR UPWARD MOVEMENT LAST WEEK - INTERMODAL
COALspot.com: The Dry Bulk market displayed a mirror performance of that of the week prior, with the Capesize market correcting further upwards and ...
Tuesday, 27 January 15
Q1 FOB INDONESIA COAL SWAP CLOSED AT $ 47.87 FOR WEEK ENDING JAN. 23
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 gain week over week and declined month on month.
The Q1 swap has decline US$ 0.9 ...
Tuesday, 27 January 15
Q2 FOB NEWCASTLE COAL SWAP UP 4.5% W-O-W
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery declined US$ 0.28 per MT (-0.54%) month over month and increased US$ 1.23 ( ...
Monday, 26 January 15
OVERSUPPLY, AMPLE STOCKPILES, AND LACKLUSTER UNDERLYING STEEL DEMAND KEPT COKING COAL PRICES LOW IN 2014
COALspot.com: Coking coal prices (FOB & CFR) fell 15% and 18% respectively during the year, amidst persistent oversupply, ample inventory and s ...
Monday, 26 January 15
FOB RICHARDS BAY Q2 COAL SWAP CLOSED LOWER THAN Q1 CLOSING
COALspot.com: API 4 FOB Richards Bay Coal swap for delivery Q1' 2015 declined month over month and day on day.
The Q1 swap has fell ...
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- Riau Bara Harum - Indonesia
- Gujarat Sidhee Cement - India
- Banpu Public Company Limited - Thailand
- Madhucon Powers Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- CIMB Investment Bank - Malaysia
- Barasentosa Lestari - Indonesia
- Kartika Selabumi Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Central Java Power - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Straits Asia Resources Limited - Singapore
- Indogreen Group - Indonesia
- Australian Coal Association
- Samtan Co., Ltd - South Korea
- Bukit Makmur.PT - Indonesia
- Semirara Mining Corp, Philippines
- Intertek Mineral Services - Indonesia
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- Videocon Industries ltd - India
- Electricity Generating Authority of Thailand
- McConnell Dowell - Australia
- Bayan Resources Tbk. - Indonesia
- VISA Power Limited - India
- Mercuria Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Baramulti Group, Indonesia
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Eastern Coal Council - USA
- New Zealand Coal & Carbon
- Kapuas Tunggal Persada - Indonesia
- Renaissance Capital - South Africa
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- Independent Power Producers Association of India
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Bhoruka Overseas - Indonesia
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- Globalindo Alam Lestari - Indonesia
- Deloitte Consulting - India
- Formosa Plastics Group - Taiwan
- Karaikal Port Pvt Ltd - India
- The University of Queensland
- ASAPP Information Group - India
- Planning Commission, India
- Petrochimia International Co. Ltd.- Taiwan
- Vizag Seaport Private Limited - India
- Meralco Power Generation, Philippines
- London Commodity Brokers - England
- CNBM International Corporation - China
- Borneo Indobara - Indonesia
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Coastal Gujarat Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Agrawal Coal Company - India
- Asmin Koalindo Tuhup - Indonesia
- Uttam Galva Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Ambuja Cements Ltd - India
- Posco Energy - South Korea
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Leighton Contractors Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Bhatia International Limited - India
- Petron Corporation, Philippines
- Commonwealth Bank - Australia
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Indo Tambangraya Megah - Indonesia
- Bangladesh Power Developement Board
- Jaiprakash Power Ventures ltd
- Thai Mozambique Logistica
- Heidelberg Cement - Germany
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Eastern Energy - Thailand
- Therma Luzon, Inc, Philippines
- IEA Clean Coal Centre - UK
- Vijayanagar Sugar Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Sical Logistics Limited - India
- Holcim Trading Pte Ltd - Singapore
- Minerals Council of Australia
- SMC Global Power, Philippines
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Electricity Authority, New Zealand
- Essar Steel Hazira Ltd - India
- Kideco Jaya Agung - Indonesia
- Bharathi Cement Corporation - India
- Bulk Trading Sa - Switzerland
- Kaltim Prima Coal - Indonesia
- Power Finance Corporation Ltd., India
- Tata Chemicals Ltd - India
- Indonesian Coal Mining Association
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- MS Steel International - UAE
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- Economic Council, Georgia
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Price Waterhouse Coopers - Russia
- Aditya Birla Group - India
- Siam City Cement PLC, Thailand
- White Energy Company Limited
- Medco Energi Mining Internasional
- Gujarat Electricity Regulatory Commission - India
- Directorate General of MIneral and Coal - Indonesia
- Sojitz Corporation - Japan
- Kobexindo Tractors - Indoneisa
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- Oldendorff Carriers - Singapore
- Ind-Barath Power Infra Limited - India
- Jindal Steel & Power Ltd - India
- Edison Trading Spa - Italy
- Rio Tinto Coal - Australia
- International Coal Ventures Pvt Ltd - India
- PowerSource Philippines DevCo
- Cement Manufacturers Association - India
- Wilmar Investment Holdings
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining and Power Corporation, Philippines
- Indian Energy Exchange, India
- Meenaskhi Energy Private Limited - India
- Attock Cement Pakistan Limited
- Toyota Tsusho Corporation, Japan
- Sinarmas Energy and Mining - Indonesia
- India Bulls Power Limited - India
- Singapore Mercantile Exchange
- Billiton Holdings Pty Ltd - Australia
- Ceylon Electricity Board - Sri Lanka
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- Wood Mackenzie - Singapore
- Bukit Baiduri Energy - Indonesia
- Vedanta Resources Plc - India
- Standard Chartered Bank - UAE
- LBH Netherlands Bv - Netherlands
- The Treasury - Australian Government
- Sree Jayajothi Cements Limited - India
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Iligan Light & Power Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Xindia Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- Bhushan Steel Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Larsen & Toubro Limited - India
- Maheswari Brothers Coal Limited - India
- Ministry of Transport, Egypt
- Manunggal Multi Energi - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Aboitiz Power Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- TeaM Sual Corporation - Philippines
- Interocean Group of Companies - India
- Kohat Cement Company Ltd. - Pakistan
- Sindya Power Generating Company Private Ltd
- Australian Commodity Traders Exchange
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- ICICI Bank Limited - India
- Indika Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Global Coal Blending Company Limited - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Chamber of Mines of South Africa
- Ministry of Finance - Indonesia
- Central Electricity Authority - India
- PTC India Limited - India
- Energy Link Ltd, New Zealand
- Africa Commodities Group - South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Siam City Cement - Thailand
- Sakthi Sugars Limited - India
- Makarim & Taira - Indonesia
- European Bulk Services B.V. - Netherlands
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