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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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Saturday, 03 January 15
U.S WEEKLY COAL PRODUCTION FELL 11.2% TO 17.6 MMST WEEK OVER WEEK - EIA
COALspot.com – United States the world's one of the largest coal producers, produced approximately 17.6 million short tons (mmst) of coal ...
Thursday, 01 January 15
FOB RICHARDS BAY COAL SWAPS CLOSED AT $63.47 PMT ON 26 DEC, SGX DATA SHOWS
COALspot.com: API 4 FOB Richards Bay Coal for delivery Q1' 2015 lost month on month and week over week.
The Q1 swap has lost US$ 3.37 (-4. ...
Wednesday, 31 December 14
COASTAL ENERGEN (C&O) COMMENCES 1ST UNIT OF 1200 MW POWER PLANT IN INDIA
COALspot.com: Coastal Energen, part of the Coal & Oil Group, announced last week the commissioning and commencement of power production at the ...
Wednesday, 31 December 14
SUB-BIT INDONESIA COAL Q2' 15 DELIVERY SWAP CLOSED 1.03% LOWER COMPARED TO AVERAGE Q1' 15 DELIVERY PRICE - SGX
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 lost month on month and gained week over week.
The Q1 swap has lost US$ 1.35 (-2 ...
Tuesday, 30 December 14
SHIP PRICES KEEP ON FALLING, SALES COME EARLY FOR SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Ship prices keep on falling on the back of low freight rates. According to the latest report from shipbroker Allied Shipbroking, January sales seem ...
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- Romanian Commodities Exchange
- Australian Coal Association
- Marubeni Corporation - India
- Ambuja Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Vizag Seaport Private Limited - India
- Binh Thuan Hamico - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pipit Mutiara Jaya. PT, Indonesia
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Semirara Mining Corp, Philippines
- San Jose City I Power Corp, Philippines
- Bhushan Steel Limited - India
- Samtan Co., Ltd - South Korea
- Mintek Dendrill Indonesia
- Georgia Ports Authority, United States
- Gujarat Mineral Development Corp Ltd - India
- Baramulti Group, Indonesia
- Thai Mozambique Logistica
- Formosa Plastics Group - Taiwan
- VISA Power Limited - India
- Toyota Tsusho Corporation, Japan
- Ind-Barath Power Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sakthi Sugars Limited - India
- Global Coal Blending Company Limited - Australia
- SMC Global Power, Philippines
- CNBM International Corporation - China
- Kideco Jaya Agung - Indonesia
- Edison Trading Spa - Italy
- SMG Consultants - Indonesia
- CIMB Investment Bank - Malaysia
- Cigading International Bulk Terminal - Indonesia
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- TeaM Sual Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- Mjunction Services Limited - India
- Central Java Power - Indonesia
- Directorate Of Revenue Intelligence - India
- Indo Tambangraya Megah - Indonesia
- Intertek Mineral Services - Indonesia
- Standard Chartered Bank - UAE
- Savvy Resources Ltd - HongKong
- Indika Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Star Paper Mills Limited - India
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Tata Chemicals Ltd - India
- MS Steel International - UAE
- Power Finance Corporation Ltd., India
- Singapore Mercantile Exchange
- Timah Investasi Mineral - Indoneisa
- GMR Energy Limited - India
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Wood Mackenzie - Singapore
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- Thiess Contractors Indonesia
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Minerals Council of Australia
- Sojitz Corporation - Japan
- Coastal Gujarat Power Limited - India
- Borneo Indobara - Indonesia
- Karaikal Port Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Tamil Nadu electricity Board
- PTC India Limited - India
- Kapuas Tunggal Persada - Indonesia
- Orica Australia Pty. Ltd.
- Attock Cement Pakistan Limited
- Barasentosa Lestari - Indonesia
- Vedanta Resources Plc - India
- Trasteel International SA, Italy
- Meenaskhi Energy Private Limited - India
- Deloitte Consulting - India
- Latin American Coal - Colombia
- Therma Luzon, Inc, Philippines
- Metalloyd Limited - United Kingdom
- Holcim Trading Pte Ltd - Singapore
- Pendopo Energi Batubara - Indonesia
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- Asmin Koalindo Tuhup - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Videocon Industries ltd - India
- Goldman Sachs - Singapore
- Ministry of Mines - Canada
- Bukit Asam (Persero) Tbk - Indonesia
- ICICI Bank Limited - India
- Rashtriya Ispat Nigam Limited - India
- Price Waterhouse Coopers - Russia
- Essar Steel Hazira Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Economic Council, Georgia
- Energy Link Ltd, New Zealand
- Ministry of Finance - Indonesia
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Global Business Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Neyveli Lignite Corporation Ltd, - India
- Wilmar Investment Holdings
- Indonesian Coal Mining Association
- Cement Manufacturers Association - India
- India Bulls Power Limited - India
- Ministry of Transport, Egypt
- Commonwealth Bank - Australia
- The University of Queensland
- White Energy Company Limited
- Jindal Steel & Power Ltd - India
- Bulk Trading Sa - Switzerland
- Sindya Power Generating Company Private Ltd
- Carbofer General Trading SA - India
- IHS Mccloskey Coal Group - USA
- Globalindo Alam Lestari - Indonesia
- Anglo American - United Kingdom
- Malabar Cements Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Indian Oil Corporation Limited
- Mercuria Energy - Indonesia
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- Chamber of Mines of South Africa
- PNOC Exploration Corporation - Philippines
- Meralco Power Generation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Aditya Birla Group - India
- Jorong Barutama Greston.PT - Indonesia
- Indian Energy Exchange, India
- Sical Logistics Limited - India
- McConnell Dowell - Australia
- Medco Energi Mining Internasional
- Maheswari Brothers Coal Limited - India
- The Treasury - Australian Government
- Straits Asia Resources Limited - Singapore
- Altura Mining Limited, Indonesia
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Port Waratah Coal Services - Australia
- Coal and Oil Company - UAE
- Sarangani Energy Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Coal Council - USA
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bhoruka Overseas - Indonesia
- Parry Sugars Refinery, India
- OPG Power Generation Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Rio Tinto Coal - Australia
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Xindia Steels Limited - India
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement - Thailand
- The State Trading Corporation of India Ltd
- Bukit Baiduri Energy - Indonesia
- New Zealand Coal & Carbon
- Simpson Spence & Young - Indonesia
- Indogreen Group - Indonesia
- Dalmia Cement Bharat India
- Salva Resources Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Bhatia International Limited - India
- Agrawal Coal Company - India
- Uttam Galva Steels Limited - India
- Electricity Authority, New Zealand
- London Commodity Brokers - England
- Planning Commission, India
- Gujarat Electricity Regulatory Commission - India
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bangladesh Power Developement Board
- Coalindo Energy - Indonesia
- GVK Power & Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Antam Resourcindo - Indonesia
- SN Aboitiz Power Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Interocean Group of Companies - India
- Parliament of New Zealand
- Renaissance Capital - South Africa
- Jaiprakash Power Ventures ltd
- Heidelberg Cement - Germany
- Manunggal Multi Energi - Indonesia
- Orica Mining Services - Indonesia
- Merrill Lynch Commodities Europe
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Development Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
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