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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, 29 April 14
Q4 SUB-BIT INDONESIA COAL SWAP CLOSED US$ 1.07 HIGHER COMPARED TO Q2 DELIVERY PRICE
COALspot.com: Indonesian coal swaps for average Q2’ 2014 gain on month and on week according to AsiaClear OTC coal swap's reports rele ...
Tuesday, 29 April 14
NEWCASTLE SHIPPED 3.03 MILLION TONS WEEK ON WEEK
COALspot.com: In the week ended 07:00 hours 28 April 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensl ...
Tuesday, 29 April 14
Q2 API 8 CFR SOUTH CHINA COAL SWAP LOST 0.29% MONTH ON MONTH
COALspot.com: API 8 CFR South China Coal swaps for average Q2 14 deliveries lost 0.29 percent month on month and closed at US$ 75.43 per mt as o ...
Monday, 28 April 14
CHINA LIKELY TO FALL SHORT OF NUCLEAR POWER TARGETS AT 175GW OF CAPACITY BY 2030 - WOOD MACKENZIE
Coal will remain dominant supply at 64% of power mix
Wood Mackenzie forecasts that China will not meet its environmentally-driven, government ...
Sunday, 27 April 14
INDONESIA TO INDIA FREIGHT RATES ARE EXPECTED TO BE STEADY NEXT WEEK
COALspot.com: The freight market seems to have bottomed out and saw some marginal gains in all segments, said Capt. Reddy of Vistaar Shipping In ...
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- Straits Asia Resources Limited - Singapore
- Dalmia Cement Bharat India
- Indian Oil Corporation Limited
- Romanian Commodities Exchange
- Rio Tinto Coal - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Siam City Cement - Thailand
- Kartika Selabumi Mining - Indonesia
- Marubeni Corporation - India
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Metalloyd Limited - United Kingdom
- Semirara Mining Corp, Philippines
- Renaissance Capital - South Africa
- Trasteel International SA, Italy
- Kumho Petrochemical, South Korea
- Australian Commodity Traders Exchange
- IEA Clean Coal Centre - UK
- India Bulls Power Limited - India
- Aboitiz Power Corporation - Philippines
- Lanco Infratech Ltd - India
- Globalindo Alam Lestari - Indonesia
- Star Paper Mills Limited - India
- Eastern Coal Council - USA
- Global Business Power Corporation, Philippines
- Petron Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Anglo American - United Kingdom
- Interocean Group of Companies - India
- GVK Power & Infra Limited - India
- Videocon Industries ltd - India
- Ministry of Mines - Canada
- Sarangani Energy Corporation, Philippines
- Wood Mackenzie - Singapore
- SN Aboitiz Power Inc, Philippines
- Commonwealth Bank - Australia
- Jaiprakash Power Ventures ltd
- Alfred C Toepfer International GmbH - Germany
- Goldman Sachs - Singapore
- Bangladesh Power Developement Board
- SMC Global Power, Philippines
- Kobexindo Tractors - Indoneisa
- IHS Mccloskey Coal Group - USA
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- ICICI Bank Limited - India
- Bhoruka Overseas - Indonesia
- Minerals Council of Australia
- OPG Power Generation Pvt Ltd - India
- Indonesian Coal Mining Association
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- CIMB Investment Bank - Malaysia
- Banpu Public Company Limited - Thailand
- Sinarmas Energy and Mining - Indonesia
- Ambuja Cements Ltd - India
- Orica Mining Services - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Sidhee Cement - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Carbofer General Trading SA - India
- Cigading International Bulk Terminal - Indonesia
- London Commodity Brokers - England
- Simpson Spence & Young - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tamil Nadu electricity Board
- South Luzon Thermal Energy Corporation
- Thiess Contractors Indonesia
- CNBM International Corporation - China
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Kideco Jaya Agung - Indonesia
- Price Waterhouse Coopers - Russia
- Bhatia International Limited - India
- Oldendorff Carriers - Singapore
- Xindia Steels Limited - India
- Bulk Trading Sa - Switzerland
- Makarim & Taira - Indonesia
- Coal and Oil Company - UAE
- Krishnapatnam Port Company Ltd. - India
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Economic Council, Georgia
- Binh Thuan Hamico - Vietnam
- Singapore Mercantile Exchange
- Barasentosa Lestari - Indonesia
- Port Waratah Coal Services - Australia
- GN Power Mariveles Coal Plant, Philippines
- Kepco SPC Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Global Green Power PLC Corporation, Philippines
- Antam Resourcindo - Indonesia
- Indian Energy Exchange, India
- Electricity Authority, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Thai Mozambique Logistica
- Directorate General of MIneral and Coal - Indonesia
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Kaltim Prima Coal - Indonesia
- Malabar Cements Ltd - India
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- San Jose City I Power Corp, Philippines
- New Zealand Coal & Carbon
- International Coal Ventures Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Latin American Coal - Colombia
- Parry Sugars Refinery, India
- Ind-Barath Power Infra Limited - India
- Jindal Steel & Power Ltd - India
- The Treasury - Australian Government
- Gujarat Mineral Development Corp Ltd - India
- Altura Mining Limited, Indonesia
- Sakthi Sugars Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Baramulti Group, Indonesia
- Ministry of Finance - Indonesia
- Agrawal Coal Company - India
- Georgia Ports Authority, United States
- PetroVietnam Power Coal Import and Supply Company
- Meenaskhi Energy Private Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Transport, Egypt
- Manunggal Multi Energi - Indonesia
- Mercator Lines Limited - India
- Pendopo Energi Batubara - Indonesia
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- European Bulk Services B.V. - Netherlands
- Iligan Light & Power Inc, Philippines
- Bharathi Cement Corporation - India
- Riau Bara Harum - Indonesia
- Cement Manufacturers Association - India
- Eastern Energy - Thailand
- Timah Investasi Mineral - Indoneisa
- Heidelberg Cement - Germany
- Karbindo Abesyapradhi - Indoneisa
- Sree Jayajothi Cements Limited - India
- The State Trading Corporation of India Ltd
- Posco Energy - South Korea
- TeaM Sual Corporation - Philippines
- Wilmar Investment Holdings
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- Attock Cement Pakistan Limited
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Madhucon Powers Ltd - India
- Sojitz Corporation - Japan
- White Energy Company Limited
- Samtan Co., Ltd - South Korea
- Leighton Contractors Pty Ltd - Australia
- GAC Shipping (India) Pvt Ltd
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Power Finance Corporation Ltd., India
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Karaikal Port Pvt Ltd - India
- Chamber of Mines of South Africa
- Central Electricity Authority - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- ASAPP Information Group - India
- Intertek Mineral Services - Indonesia
- Directorate Of Revenue Intelligence - India
- LBH Netherlands Bv - Netherlands
- Mintek Dendrill Indonesia
- GMR Energy Limited - India
- Central Java Power - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Grasim Industreis Ltd - India
- Planning Commission, India
- Kalimantan Lumbung Energi - Indonesia
- PowerSource Philippines DevCo
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Standard Chartered Bank - UAE
- The University of Queensland
- Australian Coal Association
- Parliament of New Zealand
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- Therma Luzon, Inc, Philippines
- Sical Logistics Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Borneo Indobara - Indonesia
- Aditya Birla Group - India
- Bukit Makmur.PT - Indonesia
- Maheswari Brothers Coal Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- Bhushan Steel Limited - India
- SMG Consultants - Indonesia
- Salva Resources Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Mercuria Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- Meralco Power Generation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Formosa Plastics Group - Taiwan
- Indo Tambangraya Megah - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bukit Baiduri Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Energy Link Ltd, New Zealand
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