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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, 30 December 14
INDIA INC TO BENEFIT AS IMPORTED COAL PRICES SET TO FALL - RAHUL PRITHIANI
The Hindu: India‘s coal import volumes are set to rise by over 30 per cent over the next two years to 214 million tonnes in 2015-16, as domes ...
Tuesday, 30 December 14
U.S WEEKLY COAL PRODUCTION ALMOST FLAT AT -0.2%
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.8 million short tons (mmst) of coal ...
Monday, 29 December 14
CHINESE COAL IMPORTS: REGULATORY RISKS? - CLARKSONS
In recent years, Chinese seaborne coal imports have surged, registering average growth of 67% p.a. between 2009 and 2013 to total 265mt. However, t ...
Monday, 29 December 14
BULK MARKET ENDS YEAR ON SOUR NOTE, SHIPBROKER SEES 'BUMPY ROAD AHEAD' - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
2014 was supposed to be the year that the dry bulk market would stage a comeback and a sustainable one for that matter. However, while for the most ...
Monday, 29 December 14
Q1'15 CFR SOUTH CHINA COAL SWAP CLOSED AT $59.42
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2015 delivery has decreased by US$ 3.51 (-5.58%) month over month and US$ 0.08 (-0.13%) ...
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- CNBM International Corporation - China
- Bukit Makmur.PT - Indonesia
- Orica Mining Services - Indonesia
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- Eastern Energy - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Economic Council, Georgia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indian Oil Corporation Limited
- Wood Mackenzie - Singapore
- GAC Shipping (India) Pvt Ltd
- Globalindo Alam Lestari - Indonesia
- India Bulls Power Limited - India
- Eastern Coal Council - USA
- Sical Logistics Limited - India
- Mercator Lines Limited - India
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- San Jose City I Power Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Attock Cement Pakistan Limited
- Krishnapatnam Port Company Ltd. - India
- Ceylon Electricity Board - Sri Lanka
- ICICI Bank Limited - India
- Samtan Co., Ltd - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mjunction Services Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Mercuria Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Latin American Coal - Colombia
- Bhoruka Overseas - Indonesia
- Interocean Group of Companies - India
- Bhatia International Limited - India
- Coalindo Energy - Indonesia
- Siam City Cement - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Mineral Development Corp Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Jaiprakash Power Ventures ltd
- Vedanta Resources Plc - India
- Heidelberg Cement - Germany
- Australian Commodity Traders Exchange
- Antam Resourcindo - Indonesia
- Georgia Ports Authority, United States
- Chettinad Cement Corporation Ltd - India
- TeaM Sual Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Bharathi Cement Corporation - India
- PNOC Exploration Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Dalmia Cement Bharat India
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- London Commodity Brokers - England
- Meralco Power Generation, Philippines
- Bulk Trading Sa - Switzerland
- Gujarat Electricity Regulatory Commission - India
- Electricity Authority, New Zealand
- Central Electricity Authority - India
- Lanco Infratech Ltd - India
- VISA Power Limited - India
- Indogreen Group - Indonesia
- SMC Global Power, Philippines
- Barasentosa Lestari - Indonesia
- Metalloyd Limited - United Kingdom
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Anglo American - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Cement Manufacturers Association - India
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- New Zealand Coal & Carbon
- OPG Power Generation Pvt Ltd - India
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Borneo Indobara - Indonesia
- Ministry of Finance - Indonesia
- Romanian Commodities Exchange
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Binh Thuan Hamico - Vietnam
- Agrawal Coal Company - India
- Global Coal Blending Company Limited - Australia
- Sakthi Sugars Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Aboitiz Power Corporation - Philippines
- Parliament of New Zealand
- Posco Energy - South Korea
- Cigading International Bulk Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- GMR Energy Limited - India
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- The University of Queensland
- Alfred C Toepfer International GmbH - Germany
- Ministry of Mines - Canada
- Global Green Power PLC Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Kartika Selabumi Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maharashtra Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- MS Steel International - UAE
- Sojitz Corporation - Japan
- Straits Asia Resources Limited - Singapore
- Banpu Public Company Limited - Thailand
- Merrill Lynch Commodities Europe
- Energy Development Corp, Philippines
- Thai Mozambique Logistica
- Power Finance Corporation Ltd., India
- Karbindo Abesyapradhi - Indoneisa
- Intertek Mineral Services - Indonesia
- Savvy Resources Ltd - HongKong
- Trasteel International SA, Italy
- Kideco Jaya Agung - Indonesia
- Formosa Plastics Group - Taiwan
- Vizag Seaport Private Limited - India
- The State Trading Corporation of India Ltd
- Coal and Oil Company - UAE
- CIMB Investment Bank - Malaysia
- Essar Steel Hazira Ltd - India
- Ambuja Cements Ltd - India
- Baramulti Group, Indonesia
- Indonesian Coal Mining Association
- Siam City Cement PLC, Thailand
- Chamber of Mines of South Africa
- Carbofer General Trading SA - India
- Sarangani Energy Corporation, Philippines
- IEA Clean Coal Centre - UK
- Renaissance Capital - South Africa
- Commonwealth Bank - Australia
- Xindia Steels Limited - India
- Uttam Galva Steels Limited - India
- Oldendorff Carriers - Singapore
- Australian Coal Association
- Holcim Trading Pte Ltd - Singapore
- Parry Sugars Refinery, India
- Gujarat Sidhee Cement - India
- Petron Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Planning Commission, India
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Grasim Industreis Ltd - India
- SMG Consultants - Indonesia
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Simpson Spence & Young - Indonesia
- Independent Power Producers Association of India
- Bangladesh Power Developement Board
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Madhucon Powers Ltd - India
- Indika Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- IHS Mccloskey Coal Group - USA
- Marubeni Corporation - India
- Jindal Steel & Power Ltd - India
- The Treasury - Australian Government
- Iligan Light & Power Inc, Philippines
- ASAPP Information Group - India
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- European Bulk Services B.V. - Netherlands
- Riau Bara Harum - Indonesia
- Salva Resources Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Electricity Generating Authority of Thailand
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Minerals Council of Australia
- Goldman Sachs - Singapore
- Malabar Cements Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- White Energy Company Limited
- PTC India Limited - India
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- Directorate Of Revenue Intelligence - India
- Bukit Baiduri Energy - Indonesia
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Deloitte Consulting - India
- Kobexindo Tractors - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Ministry of Transport, Egypt
- SN Aboitiz Power Inc, Philippines
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