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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, 09 July 14
PANAMAX MARKET FINALLY CORRECTING UPWARDS; AVERAGE TC MORE THAN DOUBLING WEEK ON WEEK - INTERMODAL
The Dry Bulk market has closed off on Friday on a more positive note, with most segments noting weekly gains and the Panamax market finally correct ...
Wednesday, 09 July 14
SHIPPING MARKET INSIGHT - PANOS TSILINGIRIS
The mini-boom in dry bulker values catapulted ship prices too fast too far over the last one-and-a-half year. The concurrence of historically low p ...
Tuesday, 08 July 14
INDONESIAN COAL PRICE REFERENCE FALL AGAIN IN JULY; LOST 1.62%
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia again revised down the coal bench mark price in July. HBA for month of J ...
Tuesday, 08 July 14
ENERGY IN THE MIX - INTERMODAL SHIPBROKERS
With the Tanker freight market having showed much promise this year compared to the performance that had been noted during the previous five, it is ...
Monday, 07 July 14
INDONESIA STATE-CONTROLLED COAL MINER BUKIT ASAM TO TRADE COAL ON-LINE THROUGH JFX
COALspot.com: Indonesian state owned coal miner PT Tambang Batubara Bukit Asam Tbk (PTBA) has teamed up with Jakarta Futures Exchange (JFX) to sell ...
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- Port Waratah Coal Services - Australia
- Semirara Mining Corp, Philippines
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- Gujarat Mineral Development Corp Ltd - India
- Standard Chartered Bank - UAE
- Grasim Industreis Ltd - India
- Vedanta Resources Plc - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Electricity Generating Authority of Thailand
- Directorate Of Revenue Intelligence - India
- Gujarat Sidhee Cement - India
- Makarim & Taira - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Ambuja Cements Ltd - India
- Coalindo Energy - Indonesia
- Sakthi Sugars Limited - India
- Price Waterhouse Coopers - Russia
- Kohat Cement Company Ltd. - Pakistan
- Jindal Steel & Power Ltd - India
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Tamil Nadu electricity Board
- Semirara Mining and Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- GAC Shipping (India) Pvt Ltd
- PowerSource Philippines DevCo
- Globalindo Alam Lestari - Indonesia
- Renaissance Capital - South Africa
- Mintek Dendrill Indonesia
- IEA Clean Coal Centre - UK
- Australian Coal Association
- Directorate General of MIneral and Coal - Indonesia
- Kideco Jaya Agung - Indonesia
- Indian Oil Corporation Limited
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- Alfred C Toepfer International GmbH - Germany
- CNBM International Corporation - China
- Simpson Spence & Young - Indonesia
- Indika Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- Baramulti Group, Indonesia
- Interocean Group of Companies - India
- Larsen & Toubro Limited - India
- Sical Logistics Limited - India
- Aditya Birla Group - India
- Madhucon Powers Ltd - India
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- Agrawal Coal Company - India
- Pendopo Energi Batubara - Indonesia
- Trasteel International SA, Italy
- Kumho Petrochemical, South Korea
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Marubeni Corporation - India
- Ministry of Finance - Indonesia
- Mercator Lines Limited - India
- Videocon Industries ltd - India
- Cigading International Bulk Terminal - Indonesia
- Eastern Coal Council - USA
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Tata Chemicals Ltd - India
- Indo Tambangraya Megah - Indonesia
- PTC India Limited - India
- Central Electricity Authority - India
- Salva Resources Pvt Ltd - India
- India Bulls Power Limited - India
- Indonesian Coal Mining Association
- ICICI Bank Limited - India
- GN Power Mariveles Coal Plant, Philippines
- The Treasury - Australian Government
- GMR Energy Limited - India
- Siam City Cement PLC, Thailand
- Cement Manufacturers Association - India
- Georgia Ports Authority, United States
- Bahari Cakrawala Sebuku - Indonesia
- MS Steel International - UAE
- GVK Power & Infra Limited - India
- International Coal Ventures Pvt Ltd - India
- Africa Commodities Group - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- Jaiprakash Power Ventures ltd
- Planning Commission, India
- Pipit Mutiara Jaya. PT, Indonesia
- OPG Power Generation Pvt Ltd - India
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Oldendorff Carriers - Singapore
- Orica Mining Services - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Coastal Gujarat Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Electricity Authority, New Zealand
- Therma Luzon, Inc, Philippines
- Deloitte Consulting - India
- ASAPP Information Group - India
- Energy Link Ltd, New Zealand
- Gujarat Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Eastern Energy - Thailand
- Sojitz Corporation - Japan
- Global Coal Blending Company Limited - Australia
- London Commodity Brokers - England
- Neyveli Lignite Corporation Ltd, - India
- Rio Tinto Coal - Australia
- Star Paper Mills Limited - India
- Independent Power Producers Association of India
- Sarangani Energy Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- Mjunction Services Limited - India
- Kepco SPC Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Attock Cement Pakistan Limited
- McConnell Dowell - Australia
- Minerals Council of Australia
- Bhushan Steel Limited - India
- Straits Asia Resources Limited - Singapore
- Uttam Galva Steels Limited - India
- Samtan Co., Ltd - South Korea
- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
- Singapore Mercantile Exchange
- Bukit Makmur.PT - Indonesia
- Kobexindo Tractors - Indoneisa
- Bukit Baiduri Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- White Energy Company Limited
- Economic Council, Georgia
- Bhatia International Limited - India
- Malabar Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Transport, Egypt
- TNB Fuel Sdn Bhd - Malaysia
- Lanco Infratech Ltd - India
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- Thiess Contractors Indonesia
- Dalmia Cement Bharat India
- Global Business Power Corporation, Philippines
- Indian Energy Exchange, India
- Anglo American - United Kingdom
- Maharashtra Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Bhoruka Overseas - Indonesia
- Kartika Selabumi Mining - Indonesia
- Orica Australia Pty. Ltd.
- Heidelberg Cement - Germany
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- Central Java Power - Indonesia
- Sinarmas Energy and Mining - Indonesia
- San Jose City I Power Corp, Philippines
- Barasentosa Lestari - Indonesia
- Commonwealth Bank - Australia
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- Parliament of New Zealand
- Romanian Commodities Exchange
- Bulk Trading Sa - Switzerland
- AsiaOL BioFuels Corp., Philippines
- South Luzon Thermal Energy Corporation
- Edison Trading Spa - Italy
- Jorong Barutama Greston.PT - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- LBH Netherlands Bv - Netherlands
- The University of Queensland
- Medco Energi Mining Internasional
- Wilmar Investment Holdings
- Bharathi Cement Corporation - India
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- Carbofer General Trading SA - India
- Ceylon Electricity Board - Sri Lanka
- Banpu Public Company Limited - Thailand
- New Zealand Coal & Carbon
- Ministry of Mines - Canada
- Chettinad Cement Corporation Ltd - India
- Bangladesh Power Developement Board
- Riau Bara Harum - Indonesia
- Kaltim Prima Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- The State Trading Corporation of India Ltd
- European Bulk Services B.V. - Netherlands
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Offshore Bulk Terminal Pte Ltd, Singapore
- SN Aboitiz Power Inc, Philippines
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