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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, 09 September 14
WEAK M&A DESPITE ABUNDANT DISTRESSED INDONESIA COAL ASSETS - FITCH RATINGS
COALspot.com: Fitch Ratings says that a meaningful level of merger and acquisition (M&A) activity leading to a consolidation of the coal sector ...
Tuesday, 09 September 14
PORT OF NEWCASTLE SHIPPED 13.207 MTN OF COAL IN AUGUST; TRADE VALUE AROUND $1.17 BILLION
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $1.17 billio ...
Monday, 08 September 14
SUB-BIT FOB INDONESIA COAL SWAP UNDERPERFORMED LAST WEEK
COALspot.com: Indonesian coal swaps for average October 2014 decreased US$ 0.20 (-0.39%) day on day and US$ 1.60 (-3.04%) per mt week on week. The ...
Monday, 08 September 14
API 8 CFR SOUTH CHINA COAL SWAP FOR DELIVERY JAN'15 CLOSED AT US$ 66.30 PMT W/E 5 SEPTEMBER 2014; LOST 5.15% M-O-M
COALspot.com: API 8 CFR South China Coal swap for delivery in October 2014 decreased US$ 0.15 (-0.23%) day on day and US$ 2.05 (-3.04%) week on wee ...
Monday, 08 September 14
CHINESE IRON ORE IMPORT DEMAND VERY STRONG - COMMODORE
COALspot.com: 30 dry bulk vessels were chartered in the spot iron ore market last week to haul iron ore import cargoes to Chinese buyers.
Acco ...
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- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- Chamber of Mines of South Africa
- Eastern Energy - Thailand
- AsiaOL BioFuels Corp., Philippines
- The State Trading Corporation of India Ltd
- Power Finance Corporation Ltd., India
- Global Business Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bhatia International Limited - India
- Parliament of New Zealand
- Electricity Generating Authority of Thailand
- Formosa Plastics Group - Taiwan
- Interocean Group of Companies - India
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- Savvy Resources Ltd - HongKong
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- Thai Mozambique Logistica
- Coal and Oil Company - UAE
- Maheswari Brothers Coal Limited - India
- PNOC Exploration Corporation - Philippines
- Ministry of Mines - Canada
- Karbindo Abesyapradhi - Indoneisa
- Grasim Industreis Ltd - India
- Straits Asia Resources Limited - Singapore
- Kaltim Prima Coal - Indonesia
- Makarim & Taira - Indonesia
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- Price Waterhouse Coopers - Russia
- Kepco SPC Power Corporation, Philippines
- Agrawal Coal Company - India
- Antam Resourcindo - Indonesia
- Ministry of Finance - Indonesia
- ASAPP Information Group - India
- Indogreen Group - Indonesia
- Wilmar Investment Holdings
- Central Electricity Authority - India
- Maharashtra Electricity Regulatory Commission - India
- Riau Bara Harum - Indonesia
- Mercator Lines Limited - India
- Essar Steel Hazira Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Krishnapatnam Port Company Ltd. - India
- TeaM Sual Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Madhucon Powers Ltd - India
- Mintek Dendrill Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Meralco Power Generation, Philippines
- Coastal Gujarat Power Limited - India
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- South Luzon Thermal Energy Corporation
- Energy Development Corp, Philippines
- IEA Clean Coal Centre - UK
- Vizag Seaport Private Limited - India
- Marubeni Corporation - India
- Romanian Commodities Exchange
- CNBM International Corporation - China
- Meenaskhi Energy Private Limited - India
- The Treasury - Australian Government
- Commonwealth Bank - Australia
- Central Java Power - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Orica Australia Pty. Ltd.
- Indonesian Coal Mining Association
- Bukit Makmur.PT - Indonesia
- Malabar Cements Ltd - India
- Altura Mining Limited, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Tamil Nadu electricity Board
- Baramulti Group, Indonesia
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- London Commodity Brokers - England
- Indian Oil Corporation Limited
- Africa Commodities Group - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- India Bulls Power Limited - India
- MS Steel International - UAE
- Lanco Infratech Ltd - India
- Planning Commission, India
- Thiess Contractors Indonesia
- Anglo American - United Kingdom
- McConnell Dowell - Australia
- Bharathi Cement Corporation - India
- Medco Energi Mining Internasional
- Aboitiz Power Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Videocon Industries ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Semirara Mining and Power Corporation, Philippines
- White Energy Company Limited
- New Zealand Coal & Carbon
- Holcim Trading Pte Ltd - Singapore
- Wood Mackenzie - Singapore
- GMR Energy Limited - India
- Star Paper Mills Limited - India
- Bulk Trading Sa - Switzerland
- Kobexindo Tractors - Indoneisa
- Ambuja Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- PowerSource Philippines DevCo
- Indika Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Heidelberg Cement - Germany
- Vedanta Resources Plc - India
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- Dalmia Cement Bharat India
- Jindal Steel & Power Ltd - India
- Sarangani Energy Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Petron Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Pendopo Energi Batubara - Indonesia
- Economic Council, Georgia
- Mercuria Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- OPG Power Generation Pvt Ltd - India
- Carbofer General Trading SA - India
- Gujarat Sidhee Cement - India
- Ind-Barath Power Infra Limited - India
- Deloitte Consulting - India
- PTC India Limited - India
- Aditya Birla Group - India
- Independent Power Producers Association of India
- Coalindo Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- GAC Shipping (India) Pvt Ltd
- Edison Trading Spa - Italy
- Kideco Jaya Agung - Indonesia
- Manunggal Multi Energi - Indonesia
- Renaissance Capital - South Africa
- Borneo Indobara - Indonesia
- Trasteel International SA, Italy
- Port Waratah Coal Services - Australia
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- Australian Commodity Traders Exchange
- Georgia Ports Authority, United States
- Singapore Mercantile Exchange
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- San Jose City I Power Corp, Philippines
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Parry Sugars Refinery, India
- Semirara Mining Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Chettinad Cement Corporation Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indian Energy Exchange, India
- Rashtriya Ispat Nigam Limited - India
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement - Thailand
- Eastern Coal Council - USA
- Gujarat Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- Jaiprakash Power Ventures ltd
- ICICI Bank Limited - India
- Kumho Petrochemical, South Korea
- The University of Queensland
- Sojitz Corporation - Japan
- Ministry of Transport, Egypt
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Sical Logistics Limited - India
- Global Green Power PLC Corporation, Philippines
- Mjunction Services Limited - India
- Bangladesh Power Developement Board
- Oldendorff Carriers - Singapore
- IHS Mccloskey Coal Group - USA
- Bhoruka Overseas - Indonesia
- Toyota Tsusho Corporation, Japan
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- SMC Global Power, Philippines
- Rio Tinto Coal - Australia
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- Kapuas Tunggal Persada - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Minerals Council of Australia
- Gujarat Mineral Development Corp Ltd - India
- Cigading International Bulk Terminal - Indonesia
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