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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, 17 December 14
MARKET INSIGHT - INTERMODAL SHANGHAI, SNP TEAM
As the end of the fourth quarter is approaching, we are all witness to the second hand market prices softening day by day. Any new deal surfacing t ...
Tuesday, 16 December 14
THIS PRICE IS A STEAL - EVA TZIMA
COALspot.com: Despite concerns that the slowdown of the Chinese economy would affect imports of iron ore, it seems that this has not been the case ...
Tuesday, 16 December 14
FOB RICHARDS BAY COAL SWAP FOR Q2' 15 DELIVERY CLOSED AT US$ 65.60 PMT
COALspot.com: API 4 FOB Richards Bay Coal for delivery Q1' 2015 lost month on month.
The Q1 swap has lost US$ 0.18 (-0.27%) month on month ...
Tuesday, 16 December 14
SUB-BIT FOB INDONESIA COAL SWAP CONTINUES ITS FALL
COALspot.com: Indonesian coal swaps for delivery Q1' 2015 lost month on month, week over week and day on day.
The Q1 swap has lost US$ 1.7 ...
Monday, 15 December 14
WILL TANKERS BENEFIT FROM REEMERGENCE OF FLOATING STORAGE PLAYS? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The tanker market has been seeing high freight rates for some time now, riding on the back of low oil prices, which are boosting demand from develo ...
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- Leighton Contractors Pty Ltd - Australia
- Parry Sugars Refinery, India
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- Directorate Of Revenue Intelligence - India
- Simpson Spence & Young - Indonesia
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- Iligan Light & Power Inc, Philippines
- Formosa Plastics Group - Taiwan
- Indika Energy - Indonesia
- MS Steel International - UAE
- Xindia Steels Limited - India
- Eastern Energy - Thailand
- Ind-Barath Power Infra Limited - India
- CNBM International Corporation - China
- Therma Luzon, Inc, Philippines
- Rashtriya Ispat Nigam Limited - India
- Binh Thuan Hamico - Vietnam
- Anglo American - United Kingdom
- Karaikal Port Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Coal and Oil Company - UAE
- Bulk Trading Sa - Switzerland
- Price Waterhouse Coopers - Russia
- CIMB Investment Bank - Malaysia
- GVK Power & Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- Posco Energy - South Korea
- Vijayanagar Sugar Pvt Ltd - India
- Energy Development Corp, Philippines
- Sojitz Corporation - Japan
- Gujarat Mineral Development Corp Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Medco Energi Mining Internasional
- VISA Power Limited - India
- Ambuja Cements Ltd - India
- Minerals Council of Australia
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- Gujarat Electricity Regulatory Commission - India
- Sarangani Energy Corporation, Philippines
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
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- Global Business Power Corporation, Philippines
- Madhucon Powers Ltd - India
- The Treasury - Australian Government
- The University of Queensland
- Siam City Cement - Thailand
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- India Bulls Power Limited - India
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thiess Contractors Indonesia
- Indo Tambangraya Megah - Indonesia
- Electricity Authority, New Zealand
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- Meenaskhi Energy Private Limited - India
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Tata Chemicals Ltd - India
- Carbofer General Trading SA - India
- Australian Coal Association
- White Energy Company Limited
- Romanian Commodities Exchange
- Bukit Makmur.PT - Indonesia
- Georgia Ports Authority, United States
- Planning Commission, India
- Antam Resourcindo - Indonesia
- Jindal Steel & Power Ltd - India
- Mintek Dendrill Indonesia
- Ministry of Transport, Egypt
- Orica Mining Services - Indonesia
- Videocon Industries ltd - India
- Trasteel International SA, Italy
- London Commodity Brokers - England
- Standard Chartered Bank - UAE
- McConnell Dowell - Australia
- ASAPP Information Group - India
- Sindya Power Generating Company Private Ltd
- SMG Consultants - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Borneo Indobara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Chettinad Cement Corporation Ltd - India
- PNOC Exploration Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Chamber of Mines of South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Barasentosa Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Central Java Power - Indonesia
- TeaM Sual Corporation - Philippines
- IEA Clean Coal Centre - UK
- Coastal Gujarat Power Limited - India
- Orica Australia Pty. Ltd.
- Indogreen Group - Indonesia
- Petron Corporation, Philippines
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Global Green Power PLC Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Mercator Lines Limited - India
- Eastern Coal Council - USA
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- LBH Netherlands Bv - Netherlands
- Sical Logistics Limited - India
- Samtan Co., Ltd - South Korea
- San Jose City I Power Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Wilmar Investment Holdings
- Larsen & Toubro Limited - India
- Vizag Seaport Private Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- International Coal Ventures Pvt Ltd - India
- New Zealand Coal & Carbon
- SN Aboitiz Power Inc, Philippines
- Bharathi Cement Corporation - India
- Neyveli Lignite Corporation Ltd, - India
- Star Paper Mills Limited - India
- Ministry of Mines - Canada
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meralco Power Generation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Asmin Koalindo Tuhup - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Heidelberg Cement - Germany
- Riau Bara Harum - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Economic Council, Georgia
- Semirara Mining Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- Dalmia Cement Bharat India
- Bukit Baiduri Energy - Indonesia
- Altura Mining Limited, Indonesia
- Bhoruka Overseas - Indonesia
- Edison Trading Spa - Italy
- Kepco SPC Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- The State Trading Corporation of India Ltd
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Wood Mackenzie - Singapore
- Australian Commodity Traders Exchange
- Lanco Infratech Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Bayan Resources Tbk. - Indonesia
- Global Coal Blending Company Limited - Australia
- SMC Global Power, Philippines
- Kumho Petrochemical, South Korea
- Uttam Galva Steels Limited - India
- Renaissance Capital - South Africa
- AsiaOL BioFuels Corp., Philippines
- Interocean Group of Companies - India
- Commonwealth Bank - Australia
- Agrawal Coal Company - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Pipit Mutiara Jaya. PT, Indonesia
- Baramulti Group, Indonesia
- Thai Mozambique Logistica
- Indian Oil Corporation Limited
- Aboitiz Power Corporation - Philippines
- Bhushan Steel Limited - India
- Power Finance Corporation Ltd., India
- Metalloyd Limited - United Kingdom
- Mjunction Services Limited - India
- Central Electricity Authority - India
- Bhatia International Limited - India
- PowerSource Philippines DevCo
- PetroVietnam Power Coal Import and Supply Company
- Sakthi Sugars Limited - India
- Straits Asia Resources Limited - Singapore
- Indian Energy Exchange, India
- Africa Commodities Group - South Africa
- Vedanta Resources Plc - India
- Sree Jayajothi Cements Limited - India
- GMR Energy Limited - India
- Kapuas Tunggal Persada - Indonesia
- Coalindo Energy - Indonesia
- Rio Tinto Coal - Australia
- Singapore Mercantile Exchange
- Manunggal Multi Energi - Indonesia
- Oldendorff Carriers - Singapore
- South Luzon Thermal Energy Corporation
- Jaiprakash Power Ventures ltd
- Aditya Birla Group - India
- ICICI Bank Limited - India
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