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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, 08 October 14
OIL COULD FALL TO USD80 BEFORE SHALE SUPPLY RESPONSE - FITCH
COALspot.com: Brent oil could fall as low as USD80 a barrel before triggering a self-correcting supply response with shale-oil drillers cutting inv ...
Wednesday, 08 October 14
IS THERE ANY BRIGHT SIDE ON THE DRY BULK SEGMENT? - YANNIS OLZIERSKY
In the movie “Life Of Brian”, a character on a nearby cross was singing the famous “Always look on the bright side of life” ...
Tuesday, 07 October 14
TAIPOWER TO IMPORT 525K MT OF LOW ASH AND EXTRA LOW SULFUR SUB-BITUMINOUS COAL
COALspot.com: Taiwan Power Company intends to procure 525,000 metric tons of low ash and extra low sulfur sub-bituminous coal for Taipower thermal ...
Tuesday, 07 October 14
SUB-BIT FOB INDONESIA COAL SWAP SHOWS A FLAT TO WEAK TREND THIS PAST WEEK
COALspot.com: Indonesian coal swaps November 2014 delivery flat week on week and gained US$ 0.10 (-0.20%) per mt day on day. The swap also lost US$ ...
Tuesday, 07 October 14
THE RIO TINTO CONFIRMS THAT NO DISCUSSIONS ARE TAKING PLACE WITH GLENCORE
COALspot.com: The board of Rio Tinto notes the recent press speculation regarding a possible combination of Rio Tinto and Glencore.The Rio Tinto bo ...
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- Orica Mining Services - Indonesia
- Therma Luzon, Inc, Philippines
- Intertek Mineral Services - Indonesia
- Renaissance Capital - South Africa
- Chamber of Mines of South Africa
- Meralco Power Generation, Philippines
- Coalindo Energy - Indonesia
- Carbofer General Trading SA - India
- Jindal Steel & Power Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Bukit Baiduri Energy - Indonesia
- Parliament of New Zealand
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- Global Business Power Corporation, Philippines
- Singapore Mercantile Exchange
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- Bukit Makmur.PT - Indonesia
- Wood Mackenzie - Singapore
- PTC India Limited - India
- CNBM International Corporation - China
- Thai Mozambique Logistica
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- The State Trading Corporation of India Ltd
- Sojitz Corporation - Japan
- Merrill Lynch Commodities Europe
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- Kapuas Tunggal Persada - Indonesia
- Indian Energy Exchange, India
- European Bulk Services B.V. - Netherlands
- Gujarat Electricity Regulatory Commission - India
- Bangladesh Power Developement Board
- Electricity Generating Authority of Thailand
- Sakthi Sugars Limited - India
- Global Green Power PLC Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Central Electricity Authority - India
- Ministry of Finance - Indonesia
- Bhushan Steel Limited - India
- Deloitte Consulting - India
- Minerals Council of Australia
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- Asmin Koalindo Tuhup - Indonesia
- Sindya Power Generating Company Private Ltd
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Vedanta Resources Plc - India
- OPG Power Generation Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- The University of Queensland
- Mjunction Services Limited - India
- Pendopo Energi Batubara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Global Coal Blending Company Limited - Australia
- Romanian Commodities Exchange
- Indian Oil Corporation Limited
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- Star Paper Mills Limited - India
- Interocean Group of Companies - India
- IHS Mccloskey Coal Group - USA
- IEA Clean Coal Centre - UK
- Ministry of Transport, Egypt
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Offshore Bulk Terminal Pte Ltd, Singapore
- International Coal Ventures Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Maheswari Brothers Coal Limited - India
- Cement Manufacturers Association - India
- Gujarat Sidhee Cement - India
- Price Waterhouse Coopers - Russia
- GMR Energy Limited - India
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Orica Australia Pty. Ltd.
- Kideco Jaya Agung - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Sinarmas Energy and Mining - Indonesia
- Attock Cement Pakistan Limited
- Ambuja Cements Ltd - India
- Central Java Power - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Banpu Public Company Limited - Thailand
- Jaiprakash Power Ventures ltd
- Bulk Trading Sa - Switzerland
- Electricity Authority, New Zealand
- Iligan Light & Power Inc, Philippines
- Siam City Cement - Thailand
- Australian Commodity Traders Exchange
- ICICI Bank Limited - India
- Rashtriya Ispat Nigam Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- Samtan Co., Ltd - South Korea
- Africa Commodities Group - South Africa
- Ceylon Electricity Board - Sri Lanka
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- Petron Corporation, Philippines
- Anglo American - United Kingdom
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- Bharathi Cement Corporation - India
- Energy Development Corp, Philippines
- VISA Power Limited - India
- Straits Asia Resources Limited - Singapore
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Agrawal Coal Company - India
- CIMB Investment Bank - Malaysia
- SN Aboitiz Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Antam Resourcindo - Indonesia
- London Commodity Brokers - England
- Xindia Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Thiess Contractors Indonesia
- Economic Council, Georgia
- Kumho Petrochemical, South Korea
- Commonwealth Bank - Australia
- Marubeni Corporation - India
- Kaltim Prima Coal - Indonesia
- Medco Energi Mining Internasional
- TeaM Sual Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Videocon Industries ltd - India
- Madhucon Powers Ltd - India
- Larsen & Toubro Limited - India
- Altura Mining Limited, Indonesia
- Aditya Birla Group - India
- Cigading International Bulk Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- Posco Energy - South Korea
- Meenaskhi Energy Private Limited - India
- Krishnapatnam Port Company Ltd. - India
- Semirara Mining and Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Mercator Lines Limited - India
- Indonesian Coal Mining Association
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- White Energy Company Limited
- Tata Chemicals Ltd - India
- Kartika Selabumi Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Edison Trading Spa - Italy
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Sree Jayajothi Cements Limited - India
- Trasteel International SA, Italy
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- Eastern Coal Council - USA
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- Tamil Nadu electricity Board
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Vizag Seaport Private Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Malabar Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercuria Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Sical Logistics Limited - India
- PowerSource Philippines DevCo
- Toyota Tsusho Corporation, Japan
- Siam City Cement PLC, Thailand
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Standard Chartered Bank - UAE
- Sarangani Energy Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- MS Steel International - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karbindo Abesyapradhi - Indoneisa
- Aboitiz Power Corporation - Philippines
- Simpson Spence & Young - Indonesia
- New Zealand Coal & Carbon
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- Metalloyd Limited - United Kingdom
- Planning Commission, India
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- Indika Energy - Indonesia
- Latin American Coal - Colombia
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