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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, 11 August 14
INDONESIAN THERMAL COAL SWAPS SEEING SOME POSITIVE TREND
COALspot.com: Indonesian coal swaps for average September 2014 increased US$ 0.20 (+0.36%) day on day and US$ 1.30 (+2.41%) per mt week on week. Th ...
Monday, 11 August 14
SGX CFR SOUTH CHINA COAL SWAPS DIRECTION HEADING TO NORTH
COALspot.com: API 8 CFR South China Coal swap for delivery in September 2014 increased US$ 0.50 (+0.74%) day on day and US$ 1.55 (+2.33%)&nbs ...
Monday, 11 August 14
A TALE OF TWO TRADES - EVA TZIMA
COALspot.com: It has without a doubt been “a cruel, cruel summer” for the Dry Bulk market so far and with second hand values still stan ...
Sunday, 10 August 14
FREIGHT RATES FROM INDONESIA TO INDIA IS EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com: This week the BDI and other segments saw some improvements. The BDI increased by 3.46 pct week on week and closed at 777 points.
...
Friday, 08 August 14
MINING DISPUTE IS CRIPPLING LOCAL ECONOMIES IN EASTERN INDONESIA - JG
- By Iwan Harsono -
It seems as if there’s no end in sight to the series of negotiations between the government and mining companies about ...
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- Sindya Power Generating Company Private Ltd
- Sakthi Sugars Limited - India
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Savvy Resources Ltd - HongKong
- Directorate Of Revenue Intelligence - India
- Ministry of Finance - Indonesia
- Baramulti Group, Indonesia
- Power Finance Corporation Ltd., India
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- Wood Mackenzie - Singapore
- Central Electricity Authority - India
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- White Energy Company Limited
- Bangladesh Power Developement Board
- Cigading International Bulk Terminal - Indonesia
- Grasim Industreis Ltd - India
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Central Java Power - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bhoruka Overseas - Indonesia
- CNBM International Corporation - China
- Kobexindo Tractors - Indoneisa
- Binh Thuan Hamico - Vietnam
- Port Waratah Coal Services - Australia
- Intertek Mineral Services - Indonesia
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- TeaM Sual Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Marubeni Corporation - India
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Gujarat Sidhee Cement - India
- Karaikal Port Pvt Ltd - India
- Siam City Cement PLC, Thailand
- India Bulls Power Limited - India
- Planning Commission, India
- Sarangani Energy Corporation, Philippines
- Chamber of Mines of South Africa
- Indogreen Group - Indonesia
- Global Green Power PLC Corporation, Philippines
- Mercator Lines Limited - India
- South Luzon Thermal Energy Corporation
- Asmin Koalindo Tuhup - Indonesia
- Attock Cement Pakistan Limited
- Electricity Generating Authority of Thailand
- Indian Energy Exchange, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maheswari Brothers Coal Limited - India
- Bulk Trading Sa - Switzerland
- Parliament of New Zealand
- GVK Power & Infra Limited - India
- Latin American Coal - Colombia
- Siam City Cement - Thailand
- Mjunction Services Limited - India
- Rashtriya Ispat Nigam Limited - India
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- Parry Sugars Refinery, India
- Bhatia International Limited - India
- IHS Mccloskey Coal Group - USA
- Tata Chemicals Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mercuria Energy - Indonesia
- Essar Steel Hazira Ltd - India
- PowerSource Philippines DevCo
- Videocon Industries ltd - India
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- LBH Netherlands Bv - Netherlands
- Eastern Coal Council - USA
- European Bulk Services B.V. - Netherlands
- Commonwealth Bank - Australia
- Jaiprakash Power Ventures ltd
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Riau Bara Harum - Indonesia
- Coalindo Energy - Indonesia
- New Zealand Coal & Carbon
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Dalmia Cement Bharat India
- Jindal Steel & Power Ltd - India
- Interocean Group of Companies - India
- Global Coal Blending Company Limited - Australia
- Kideco Jaya Agung - Indonesia
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Romanian Commodities Exchange
- PNOC Exploration Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- MS Steel International - UAE
- Ministry of Mines - Canada
- Therma Luzon, Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Australian Commodity Traders Exchange
- Kaltim Prima Coal - Indonesia
- Star Paper Mills Limited - India
- GMR Energy Limited - India
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Aboitiz Power Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Indika Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- The University of Queensland
- Semirara Mining and Power Corporation, Philippines
- SMC Global Power, Philippines
- Pendopo Energi Batubara - Indonesia
- Banpu Public Company Limited - Thailand
- Ambuja Cements Ltd - India
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Malabar Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Posco Energy - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ind-Barath Power Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- Electricity Authority, New Zealand
- The State Trading Corporation of India Ltd
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- PTC India Limited - India
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- Wilmar Investment Holdings
- Gujarat Mineral Development Corp Ltd - India
- Madhucon Powers Ltd - India
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- The Treasury - Australian Government
- London Commodity Brokers - England
- Simpson Spence & Young - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Antam Resourcindo - Indonesia
- Bharathi Cement Corporation - India
- Bhushan Steel Limited - India
- Coastal Gujarat Power Limited - India
- Bukit Makmur.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Carbofer General Trading SA - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- VISA Power Limited - India
- Toyota Tsusho Corporation, Japan
- Thai Mozambique Logistica
- Australian Coal Association
- Tamil Nadu electricity Board
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Rio Tinto Coal - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- San Jose City I Power Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Mintek Dendrill Indonesia
- Cement Manufacturers Association - India
- IEA Clean Coal Centre - UK
- Makarim & Taira - Indonesia
- Sojitz Corporation - Japan
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Altura Mining Limited, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Meralco Power Generation, Philippines
- Meenaskhi Energy Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- Medco Energi Mining Internasional
- Kapuas Tunggal Persada - Indonesia
- ICICI Bank Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Vedanta Resources Plc - India
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- Deloitte Consulting - India
- Borneo Indobara - Indonesia
- Trasteel International SA, Italy
- Billiton Holdings Pty Ltd - Australia
- Barasentosa Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Salva Resources Pvt Ltd - India
- Eastern Energy - Thailand
- Orica Mining Services - Indonesia
- OPG Power Generation Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Holcim Trading Pte Ltd - Singapore
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