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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, 06 August 14
CAPES: BUSINESS INTEREST REMAINS SOFT; CURRENTLY NO SIGNS OF IMPROVEMENT - INTERMODAL
COALspot.com: Despite the considerable pressure witnessed in the freight market for most of the size segments, the Dry Bulk Index was able to note ...
Wednesday, 06 August 14
SHIPPING MARKET INSIGHT - EVA TZIMA
Recent reports that Indonesia’s ban on exports of metal ore concentrates was lifted for the first time in six months for two of its biggest m ...
Wednesday, 06 August 14
SGX SUCCESSFULLY LAUNCHED NEW SGX COAL PRODUCTS
COALspot.com: Singapore Exchange (‘SGX’) has announced that, the exchange has successfully launched its new Coking and Thermal Coal pro ...
Monday, 04 August 14
ANNUAL SECOND HALF SURGE IN BRAZILIAN IRON ORE EXPORTS ABOUT TO BEGIN - JEFFREY LANDSBERG
COALspot.com: Great strength in the capesize market has all along been set to occur during the second half of this year, as that is when Brazilian ...
Monday, 04 August 14
SUB-BIT FOB INDONESIA COAL SWAP INCHES UP DESPITE LOW DEMAND
COALspot.com: Indonesian coal swaps for average Q4’ 2014 increased US$ 0.15 day on day and US$ 0.13 per mt week on week. But, the swap was lo ...
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- Maheswari Brothers Coal Limited - India
- Mjunction Services Limited - India
- Indogreen Group - Indonesia
- Chamber of Mines of South Africa
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- Wood Mackenzie - Singapore
- Australian Coal Association
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- Aboitiz Power Corporation - Philippines
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- Merrill Lynch Commodities Europe
- Bukit Asam (Persero) Tbk - Indonesia
- Lanco Infratech Ltd - India
- Heidelberg Cement - Germany
- The University of Queensland
- Thai Mozambique Logistica
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- Mercuria Energy - Indonesia
- Jindal Steel & Power Ltd - India
- VISA Power Limited - India
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- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
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- GN Power Mariveles Coal Plant, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
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- Riau Bara Harum - Indonesia
- Meenaskhi Energy Private Limited - India
- The State Trading Corporation of India Ltd
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Borneo Indobara - Indonesia
- Malabar Cements Ltd - India
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- Vedanta Resources Plc - India
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- Commonwealth Bank - Australia
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- Toyota Tsusho Corporation, Japan
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- Minerals Council of Australia
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- Tamil Nadu electricity Board
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- Central Java Power - Indonesia
- TeaM Sual Corporation - Philippines
- Goldman Sachs - Singapore
- Central Electricity Authority - India
- Global Green Power PLC Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Electricity Authority, New Zealand
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- PowerSource Philippines DevCo
- Directorate General of MIneral and Coal - Indonesia
- Agrawal Coal Company - India
- Attock Cement Pakistan Limited
- Timah Investasi Mineral - Indoneisa
- Kobexindo Tractors - Indoneisa
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- Binh Thuan Hamico - Vietnam
- Sree Jayajothi Cements Limited - India
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- CIMB Investment Bank - Malaysia
- ASAPP Information Group - India
- Ambuja Cements Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- LBH Netherlands Bv - Netherlands
- Aditya Birla Group - India
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- Port Waratah Coal Services - Australia
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- Intertek Mineral Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Wilmar Investment Holdings
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- New Zealand Coal & Carbon
- European Bulk Services B.V. - Netherlands
- Oldendorff Carriers - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- Bulk Trading Sa - Switzerland
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Straits Asia Resources Limited - Singapore
- Siam City Cement - Thailand
- Rashtriya Ispat Nigam Limited - India
- Vizag Seaport Private Limited - India
- Anglo American - United Kingdom
- Bangladesh Power Developement Board
- PTC India Limited - India
- AsiaOL BioFuels Corp., Philippines
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- Ministry of Finance - Indonesia
- White Energy Company Limited
- Siam City Cement PLC, Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- The Treasury - Australian Government
- IHS Mccloskey Coal Group - USA
- Australian Commodity Traders Exchange
- Chettinad Cement Corporation Ltd - India
- Parliament of New Zealand
- IEA Clean Coal Centre - UK
- Indonesian Coal Mining Association
- Renaissance Capital - South Africa
- MS Steel International - UAE
- GMR Energy Limited - India
- Xindia Steels Limited - India
- Ind-Barath Power Infra Limited - India
- Jaiprakash Power Ventures ltd
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- Rio Tinto Coal - Australia
- Romanian Commodities Exchange
- Coalindo Energy - Indonesia
- Planning Commission, India
- Simpson Spence & Young - Indonesia
- Pendopo Energi Batubara - Indonesia
- Power Finance Corporation Ltd., India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Dalmia Cement Bharat India
- Asmin Koalindo Tuhup - Indonesia
- Global Coal Blending Company Limited - Australia
- Cement Manufacturers Association - India
- Kohat Cement Company Ltd. - Pakistan
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Economic Council, Georgia
- PetroVietnam Power Coal Import and Supply Company
- Tata Chemicals Ltd - India
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- GAC Shipping (India) Pvt Ltd
- Altura Mining Limited, Indonesia
- CNBM International Corporation - China
- Makarim & Taira - Indonesia
- San Jose City I Power Corp, Philippines
- Ministry of Mines - Canada
- Sojitz Corporation - Japan
- London Commodity Brokers - England
- Kepco SPC Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Independent Power Producers Association of India
- Leighton Contractors Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- Kumho Petrochemical, South Korea
- Kaltim Prima Coal - Indonesia
- Metalloyd Limited - United Kingdom
- Electricity Generating Authority of Thailand
- Carbofer General Trading SA - India
- Grasim Industreis Ltd - India
- SMC Global Power, Philippines
- Globalindo Alam Lestari - Indonesia
- Trasteel International SA, Italy
- Global Business Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Indian Oil Corporation Limited
- Cigading International Bulk Terminal - Indonesia
- Sical Logistics Limited - India
- Directorate Of Revenue Intelligence - India
- Medco Energi Mining Internasional
- Barasentosa Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Bhatia International Limited - India
- Coastal Gujarat Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Gujarat Sidhee Cement - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bharathi Cement Corporation - India
- Sindya Power Generating Company Private Ltd
- Deloitte Consulting - India
- Miang Besar Coal Terminal - Indonesia
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- Orica Australia Pty. Ltd.
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