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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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Sunday, 19 October 14
LOW DEMAND PUSHES DOWN COAL FREIGHT RATES; VOLATILITY CONTINUES
COALspot.com: This week all the segments softened including BDI except for Panamax index.
The BDI was down by1.70 pct and clsoed at 944 points ...
Friday, 17 October 14
INTERNATIONAL COAL PRICES ARE AT LOWEST LEVEL; COAL STOCKS AT INDIAN POWER PLANTS ARE ALSO AT LOWEST LEVEL
International coal prices as well as coal freights are falling and reaching to its lowest levels. According to PTI, fuel stockpiles at the thermal ...
Friday, 17 October 14
U.S. COAL PRODUCTION UP BY 3.6% WEEK - ON - WEEK
COALspot.com – United States the world's one of largest coal producers, produced approximately 19.20 million short tons (mmst) of coal in ...
Friday, 17 October 14
DRY BULK SHIPPING'S OUTLOOK NOW SHIFTING TO A LESS PROMISING ONE, SHIP PRICES EXPECTED TO FOLLOW SOON - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
China’s and other Asian countries’ return to the dry bulk market last week, didn’t trigger the hoped support towards the dry bulk ...
Thursday, 16 October 14
KOREA MIDLAND POWER TO BUY 490K MT OF LCV COAL FOR 1Q 2015
COALspot.com : Korea Midland Power Co., Ltd. has invited bids through International open bidding for 490,000 Metric Tons (MT) of LCV (Sub) Bitumino ...
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- GAC Shipping (India) Pvt Ltd
- Banpu Public Company Limited - Thailand
- PowerSource Philippines DevCo
- Sindya Power Generating Company Private Ltd
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- Miang Besar Coal Terminal - Indonesia
- Ministry of Transport, Egypt
- Indian Oil Corporation Limited
- Globalindo Alam Lestari - Indonesia
- Therma Luzon, Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Standard Chartered Bank - UAE
- Neyveli Lignite Corporation Ltd, - India
- Indian Energy Exchange, India
- Mercator Lines Limited - India
- South Luzon Thermal Energy Corporation
- Energy Development Corp, Philippines
- Global Coal Blending Company Limited - Australia
- Sinarmas Energy and Mining - Indonesia
- Ind-Barath Power Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Dalmia Cement Bharat India
- European Bulk Services B.V. - Netherlands
- Commonwealth Bank - Australia
- Xindia Steels Limited - India
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Kumho Petrochemical, South Korea
- The Treasury - Australian Government
- PetroVietnam Power Coal Import and Supply Company
- Larsen & Toubro Limited - India
- New Zealand Coal & Carbon
- Sojitz Corporation - Japan
- Ministry of Mines - Canada
- Simpson Spence & Young - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Semirara Mining and Power Corporation, Philippines
- Interocean Group of Companies - India
- OPG Power Generation Pvt Ltd - India
- Wood Mackenzie - Singapore
- PNOC Exploration Corporation - Philippines
- Tata Chemicals Ltd - India
- Aditya Birla Group - India
- Merrill Lynch Commodities Europe
- Agrawal Coal Company - India
- Siam City Cement PLC, Thailand
- Medco Energi Mining Internasional
- Sarangani Energy Corporation, Philippines
- Bharathi Cement Corporation - India
- PTC India Limited - India
- Coastal Gujarat Power Limited - India
- Minerals Council of Australia
- Eastern Coal Council - USA
- Indika Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Manunggal Multi Energi - Indonesia
- SN Aboitiz Power Inc, Philippines
- Antam Resourcindo - Indonesia
- Bulk Trading Sa - Switzerland
- Kalimantan Lumbung Energi - Indonesia
- Uttam Galva Steels Limited - India
- Global Business Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Bhatia International Limited - India
- Sical Logistics Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Samtan Co., Ltd - South Korea
- Georgia Ports Authority, United States
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- VISA Power Limited - India
- Trasteel International SA, Italy
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- Port Waratah Coal Services - Australia
- Grasim Industreis Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- Petron Corporation, Philippines
- GVK Power & Infra Limited - India
- Savvy Resources Ltd - HongKong
- Baramulti Group, Indonesia
- Power Finance Corporation Ltd., India
- GMR Energy Limited - India
- Central Electricity Authority - India
- Coalindo Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Karaikal Port Pvt Ltd - India
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- Price Waterhouse Coopers - Russia
- Binh Thuan Hamico - Vietnam
- McConnell Dowell - Australia
- Holcim Trading Pte Ltd - Singapore
- Chamber of Mines of South Africa
- Carbofer General Trading SA - India
- Mintek Dendrill Indonesia
- Romanian Commodities Exchange
- Eastern Energy - Thailand
- Altura Mining Limited, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Anglo American - United Kingdom
- Cigading International Bulk Terminal - Indonesia
- Indogreen Group - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Renaissance Capital - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meralco Power Generation, Philippines
- Mjunction Services Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Goldman Sachs - Singapore
- Bhushan Steel Limited - India
- Marubeni Corporation - India
- Heidelberg Cement - Germany
- Formosa Plastics Group - Taiwan
- Kepco SPC Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rio Tinto Coal - Australia
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- Maheswari Brothers Coal Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Coal Association
- India Bulls Power Limited - India
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- Straits Asia Resources Limited - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Mercuria Energy - Indonesia
- Thiess Contractors Indonesia
- Ministry of Finance - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bangladesh Power Developement Board
- Timah Investasi Mineral - Indoneisa
- Bukit Makmur.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- ICICI Bank Limited - India
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- Wilmar Investment Holdings
- Parry Sugars Refinery, India
- LBH Netherlands Bv - Netherlands
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Iligan Light & Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- Star Paper Mills Limited - India
- Kartika Selabumi Mining - Indonesia
- MS Steel International - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Posco Energy - South Korea
- Semirara Mining Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Siam City Cement - Thailand
- Electricity Generating Authority of Thailand
- AsiaOL BioFuels Corp., Philippines
- San Jose City I Power Corp, Philippines
- Electricity Authority, New Zealand
- Energy Link Ltd, New Zealand
- Rashtriya Ispat Nigam Limited - India
- Madhucon Powers Ltd - India
- Riau Bara Harum - Indonesia
- Intertek Mineral Services - Indonesia
- Vedanta Resources Plc - India
- The University of Queensland
- Coal and Oil Company - UAE
- Barasentosa Lestari - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Economic Council, Georgia
- The State Trading Corporation of India Ltd
- Borneo Indobara - Indonesia
- Bhoruka Overseas - Indonesia
- Makarim & Taira - Indonesia
- White Energy Company Limited
- CNBM International Corporation - China
- Edison Trading Spa - Italy
- Toyota Tsusho Corporation, Japan
- SMG Consultants - Indonesia
- Deloitte Consulting - India
- TeaM Sual Corporation - Philippines
- IEA Clean Coal Centre - UK
- Gujarat Electricity Regulatory Commission - India
- Central Java Power - Indonesia
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- Orica Mining Services - Indonesia
- Independent Power Producers Association of India
- Indonesian Coal Mining Association
- SMC Global Power, Philippines
- Alfred C Toepfer International GmbH - Germany
- Ambuja Cements Ltd - India
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