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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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Monday, 29 September 14
INDONESIAN COAL EXPORT VOLUME FALL IN AUGUST
COALspot.com: Indonesia, one of the world's largest coal producers and the global leading multi grade coal exporter shipped around $1.50 ...
Monday, 29 September 14
INDONESIAN COAL SWAPS LOST WEEK ON WEEK AND MONTH OVER MONTH
COALspot.com: Indonesian coal swaps for average November 2014 flat day on day and lost US$ 0.85 (-1.66%) per mt week on week. The swap also lost US ...
Monday, 29 September 14
CFR SOUTH CHINA COAL LOST AROUND 5% MONTH ON MONTH
COALspot.com: API 8 CFR South China Coal swap for delivery in November 2014 decreased US$ 3.55 (-5.10%) month over month and flat week over week.
...
Sunday, 28 September 14
FREIGHT RATES FROM INDONESIA TO INDIA IS EXPECTED TO BE FIRM NEXT WEEK - CAPT. REDDY
COALspot.com: The freight market shows a bit weak trend this week.
The BDI was lost 2.42% week on week and closed at 1049 points on 26 Se ...
Sunday, 28 September 14
BERAU AGREES DEAL WITH GOVT, MINING AREA REDUCED - THE JAKARTA POST
Coal miner PT Berau Coal, a subsidiary of Jakarta-listed PT Berau Coal Energy (BRAU), has signed a memorandum of understanding (MoU) with the gover ...
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- Latin American Coal - Colombia
- Edison Trading Spa - Italy
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- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PTC India Limited - India
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- SMC Global Power, Philippines
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Karaikal Port Pvt Ltd - India
- Rio Tinto Coal - Australia
- Madhucon Powers Ltd - India
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- Coalindo Energy - Indonesia
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- Attock Cement Pakistan Limited
- Malabar Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- Sindya Power Generating Company Private Ltd
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- PowerSource Philippines DevCo
- Cement Manufacturers Association - India
- Salva Resources Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Port Waratah Coal Services - Australia
- CNBM International Corporation - China
- Karbindo Abesyapradhi - Indoneisa
- Eastern Coal Council - USA
- Bharathi Cement Corporation - India
- Xindia Steels Limited - India
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- Meenaskhi Energy Private Limited - India
- VISA Power Limited - India
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- South Luzon Thermal Energy Corporation
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- Orica Australia Pty. Ltd.
- The University of Queensland
- New Zealand Coal & Carbon
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- Metalloyd Limited - United Kingdom
- Directorate Of Revenue Intelligence - India
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- Planning Commission, India
- Bank of Tokyo Mitsubishi UFJ Ltd
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- Eastern Energy - Thailand
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- Indonesian Coal Mining Association
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- Electricity Authority, New Zealand
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- Australian Commodity Traders Exchange
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Tata Chemicals Ltd - India
- PNOC Exploration Corporation - Philippines
- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- Renaissance Capital - South Africa
- Kepco SPC Power Corporation, Philippines
- Energy Development Corp, Philippines
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Uttam Galva Steels Limited - India
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- Global Green Power PLC Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Indian Oil Corporation Limited
- Ceylon Electricity Board - Sri Lanka
- Bukit Asam (Persero) Tbk - Indonesia
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
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- Essar Steel Hazira Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Petron Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Manunggal Multi Energi - Indonesia
- Ministry of Mines - Canada
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- Star Paper Mills Limited - India
- Indo Tambangraya Megah - Indonesia
- Siam City Cement PLC, Thailand
- Wilmar Investment Holdings
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- LBH Netherlands Bv - Netherlands
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- Kaltim Prima Coal - Indonesia
- Merrill Lynch Commodities Europe
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- OPG Power Generation Pvt Ltd - India
- Anglo American - United Kingdom
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- Orica Mining Services - Indonesia
- Barasentosa Lestari - Indonesia
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Electricity Generating Authority of Thailand
- AsiaOL BioFuels Corp., Philippines
- Borneo Indobara - Indonesia
- Jindal Steel & Power Ltd - India
- Parliament of New Zealand
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- Africa Commodities Group - South Africa
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Jaiprakash Power Ventures ltd
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- Sojitz Corporation - Japan
- San Jose City I Power Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Riau Bara Harum - Indonesia
- Georgia Ports Authority, United States
- Samtan Co., Ltd - South Korea
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kalimantan Lumbung Energi - Indonesia
- Indian Energy Exchange, India
- Singapore Mercantile Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Mjunction Services Limited - India
- Kobexindo Tractors - Indoneisa
- Price Waterhouse Coopers - Russia
- Bayan Resources Tbk. - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Banpu Public Company Limited - Thailand
- ICICI Bank Limited - India
- Aboitiz Power Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- The Treasury - Australian Government
- Vedanta Resources Plc - India
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- PetroVietnam Power Coal Import and Supply Company
- Grasim Industreis Ltd - India
- Chamber of Mines of South Africa
- Asmin Koalindo Tuhup - Indonesia
- GAC Shipping (India) Pvt Ltd
- Rashtriya Ispat Nigam Limited - India
- IEA Clean Coal Centre - UK
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
- Altura Mining Limited, Indonesia
- Vizag Seaport Private Limited - India
- Power Finance Corporation Ltd., India
- Ind-Barath Power Infra Limited - India
- Bukit Makmur.PT - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Energy Link Ltd, New Zealand
- Thiess Contractors Indonesia
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- Central Java Power - Indonesia
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- Miang Besar Coal Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Semirara Mining Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Economic Council, Georgia
- Maharashtra Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Coal and Oil Company - UAE
- International Coal Ventures Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- London Commodity Brokers - England
- Minerals Council of Australia
- Thai Mozambique Logistica
- CIMB Investment Bank - Malaysia
- Wood Mackenzie - Singapore
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- Therma Luzon, Inc, Philippines
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- Asia Pacific Energy Resources Ventures Inc, Philippines
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