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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, 20 January 15
INDIA TO SURPASS THE UNITED STATES AND BECOME THE SECOND-LARGEST COAL CONSUMER IN THE WORLD BY 2019 - IMF
COALspot.com: In 2013, coal added more primary energy than any other fuel and was the fastest-growing fossil fuel, enhancing its position as the se ...
Tuesday, 20 January 15
INDONESIAN COAL OUTPUT SEEN RISING, DESPITE FALL IN ITS PRICE
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 declined month on month and week over week, but Indonesian Coal Output Seen Rising. T ...
Tuesday, 20 January 15
NEWCASTLE COAL SWAP FOR Q1' 2015 DELIVERY DECLINED 2.83% M-O-M
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2015 delivery declined US$ 1.45 per MT (-2.83%) month over month and US$ 0.50 (-0.99%) we ...
Monday, 19 January 15
HBA FALL TO FRESH LOWS; COAL OVERSUPPLY WILL CONTINUE TO PUSH PRICE DOWN
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia revised down Indonesian coal bench mark price this month to US$ 63.84. T ...
Monday, 19 January 15
CFR SOUTH CHINA COAL SWAPS REMAIN WEAK
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2015 delivery declined US$ 3.37 (-5.63%) per MT month over month and US$ 0.74 (-1.29%) ...
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- Interocean Group of Companies - India
- Rashtriya Ispat Nigam Limited - India
- IHS Mccloskey Coal Group - USA
- Larsen & Toubro Limited - India
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- Price Waterhouse Coopers - Russia
- London Commodity Brokers - England
- Standard Chartered Bank - UAE
- Latin American Coal - Colombia
- San Jose City I Power Corp, Philippines
- Indonesian Coal Mining Association
- GN Power Mariveles Coal Plant, Philippines
- Star Paper Mills Limited - India
- Rio Tinto Coal - Australia
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Thai Mozambique Logistica
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Deloitte Consulting - India
- Singapore Mercantile Exchange
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- Xindia Steels Limited - India
- Meenaskhi Energy Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Maheswari Brothers Coal Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Sarangani Energy Corporation, Philippines
- Electricity Generating Authority of Thailand
- India Bulls Power Limited - India
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Bukit Asam (Persero) Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Georgia Ports Authority, United States
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Australian Coal Association
- Malabar Cements Ltd - India
- European Bulk Services B.V. - Netherlands
- Grasim Industreis Ltd - India
- Attock Cement Pakistan Limited
- IEA Clean Coal Centre - UK
- Ind-Barath Power Infra Limited - India
- Simpson Spence & Young - Indonesia
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- Bukit Baiduri Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Marubeni Corporation - India
- Samtan Co., Ltd - South Korea
- Posco Energy - South Korea
- Ministry of Mines - Canada
- Neyveli Lignite Corporation Ltd, - India
- Eastern Energy - Thailand
- Dalmia Cement Bharat India
- Therma Luzon, Inc, Philippines
- Eastern Coal Council - USA
- Intertek Mineral Services - Indonesia
- Meralco Power Generation, Philippines
- Parliament of New Zealand
- Gujarat Sidhee Cement - India
- Banpu Public Company Limited - Thailand
- SN Aboitiz Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Siam City Cement PLC, Thailand
- Kohat Cement Company Ltd. - Pakistan
- Holcim Trading Pte Ltd - Singapore
- Karaikal Port Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
- ASAPP Information Group - India
- ICICI Bank Limited - India
- Aboitiz Power Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Sojitz Corporation - Japan
- Bangladesh Power Developement Board
- Cement Manufacturers Association - India
- Planning Commission, India
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Metalloyd Limited - United Kingdom
- Gujarat Mineral Development Corp Ltd - India
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- PowerSource Philippines DevCo
- Jorong Barutama Greston.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Coastal Gujarat Power Limited - India
- GMR Energy Limited - India
- The Treasury - Australian Government
- Tamil Nadu electricity Board
- Chamber of Mines of South Africa
- Kumho Petrochemical, South Korea
- Binh Thuan Hamico - Vietnam
- Krishnapatnam Port Company Ltd. - India
- PTC India Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Videocon Industries ltd - India
- LBH Netherlands Bv - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Barasentosa Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- CIMB Investment Bank - Malaysia
- Riau Bara Harum - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Central Java Power - Indonesia
- Ambuja Cements Ltd - India
- Edison Trading Spa - Italy
- Global Green Power PLC Corporation, Philippines
- Africa Commodities Group - South Africa
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Finance - Indonesia
- Aditya Birla Group - India
- Sinarmas Energy and Mining - Indonesia
- Port Waratah Coal Services - Australia
- Indian Oil Corporation Limited
- GAC Shipping (India) Pvt Ltd
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kartika Selabumi Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- Globalindo Alam Lestari - Indonesia
- Petron Corporation, Philippines
- South Luzon Thermal Energy Corporation
- TNB Fuel Sdn Bhd - Malaysia
- Indika Energy - Indonesia
- SMG Consultants - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Bhushan Steel Limited - India
- White Energy Company Limited
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- Kaltim Prima Coal - Indonesia
- Medco Energi Mining Internasional
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Heidelberg Cement - Germany
- Australian Commodity Traders Exchange
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Electricity Authority, New Zealand
- Salva Resources Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bhatia International Limited - India
- Altura Mining Limited, Indonesia
- Bayan Resources Tbk. - Indonesia
- Tata Chemicals Ltd - India
- Savvy Resources Ltd - HongKong
- Mercuria Energy - Indonesia
- Bharathi Cement Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Offshore Bulk Terminal Pte Ltd, Singapore
- TeaM Sual Corporation - Philippines
- Makarim & Taira - Indonesia
- Mercator Lines Limited - India
- Bulk Trading Sa - Switzerland
- Mintek Dendrill Indonesia
- MS Steel International - UAE
- Parry Sugars Refinery, India
- Madhucon Powers Ltd - India
- Central Electricity Authority - India
- CNBM International Corporation - China
- AsiaOL BioFuels Corp., Philippines
- OPG Power Generation Pvt Ltd - India
- Sakthi Sugars Limited - India
- Essar Steel Hazira Ltd - India
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- The University of Queensland
- Independent Power Producers Association of India
- The State Trading Corporation of India Ltd
- Maharashtra Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- Asmin Koalindo Tuhup - Indonesia
- Coalindo Energy - Indonesia
- Renaissance Capital - South Africa
- Kapuas Tunggal Persada - Indonesia
- Sical Logistics Limited - India
- Wood Mackenzie - Singapore
- Orica Australia Pty. Ltd.
- Global Coal Blending Company Limited - Australia
- International Coal Ventures Pvt Ltd - India
- Romanian Commodities Exchange
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- Goldman Sachs - Singapore
- Indogreen Group - Indonesia
- Minerals Council of Australia
- Toyota Tsusho Corporation, Japan
- PNOC Exploration Corporation - Philippines
- Borneo Indobara - Indonesia
- Mjunction Services Limited - India
- Orica Mining Services - Indonesia
- SMC Global Power, Philippines
- Oldendorff Carriers - Singapore
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
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