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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, 02 April 14
CHINA: ARBITRATION CLAUSES IN BILLS OF LADING UNDER CHINESE LEGAL PRACTICE - SKULD
KNOWLEDGE TO ELEVATE
Successful incorporation of a charterparty arbitration clause into the bills of lading is not a straight forward matte ...
Wednesday, 02 April 14
BPI BREAKING BELOW THE 1,000 PSYCHOLOGICAL LEVELS - INTERMODAL
Any resistance put forth by the Dry Bulk market the week prior was succumbed this time round. All indices slid and losses were noted across the ...
Tuesday, 01 April 14
NEWCASTLE PORT SHIPPED 11.95 MILLION TONS OF COAL IN MARCH 2014
COALspot.com: In the week ended 31 March 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, total 2 ...
Monday, 31 March 14
SHIPPING CONFIDENCE HITS HIGHEST LEVEL SINCE 2008 - MOORE STEPHENS
Overall confidence levels in the shipping industry rose to their highest level for almost six years in the three-month period to February 2014, ...
Monday, 31 March 14
COAL SWAP FOR Q1 2015 DELIVERY HAS CLOSED 4.76% HIGHER COMPARED Q2 14 CLOSING
COALspot.com – Indonesia, the world’s largest exporter of the thermal coal's swaps for delivery April - June 2014 gained this pa ...
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- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Global Business Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- White Energy Company Limited
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Pipit Mutiara Jaya. PT, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Energy Link Ltd, New Zealand
- Ministry of Transport, Egypt
- Anglo American - United Kingdom
- Semirara Mining Corp, Philippines
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Economic Council, Georgia
- Rashtriya Ispat Nigam Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Attock Cement Pakistan Limited
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- Tata Chemicals Ltd - India
- Rio Tinto Coal - Australia
- Siam City Cement PLC, Thailand
- Videocon Industries ltd - India
- Electricity Generating Authority of Thailand
- Larsen & Toubro Limited - India
- Uttam Galva Steels Limited - India
- Salva Resources Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Sical Logistics Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kapuas Tunggal Persada - Indonesia
- Goldman Sachs - Singapore
- Merrill Lynch Commodities Europe
- Bukit Asam (Persero) Tbk - Indonesia
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- Coalindo Energy - Indonesia
- Ambuja Cements Ltd - India
- India Bulls Power Limited - India
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- SMG Consultants - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wood Mackenzie - Singapore
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- Bharathi Cement Corporation - India
- Carbofer General Trading SA - India
- VISA Power Limited - India
- Bhatia International Limited - India
- Bukit Makmur.PT - Indonesia
- Eastern Coal Council - USA
- CIMB Investment Bank - Malaysia
- Standard Chartered Bank - UAE
- Agrawal Coal Company - India
- Thiess Contractors Indonesia
- Kartika Selabumi Mining - Indonesia
- Indogreen Group - Indonesia
- GVK Power & Infra Limited - India
- Eastern Energy - Thailand
- Xindia Steels Limited - India
- GAC Shipping (India) Pvt Ltd
- Dalmia Cement Bharat India
- Medco Energi Mining Internasional
- Trasteel International SA, Italy
- Metalloyd Limited - United Kingdom
- Deloitte Consulting - India
- Miang Besar Coal Terminal - Indonesia
- Kideco Jaya Agung - Indonesia
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Kumho Petrochemical, South Korea
- Riau Bara Harum - Indonesia
- Mercator Lines Limited - India
- Power Finance Corporation Ltd., India
- Mintek Dendrill Indonesia
- Georgia Ports Authority, United States
- Wilmar Investment Holdings
- Africa Commodities Group - South Africa
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- The University of Queensland
- Global Coal Blending Company Limited - Australia
- GN Power Mariveles Coal Plant, Philippines
- OPG Power Generation Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- Electricity Authority, New Zealand
- Indika Energy - Indonesia
- Australian Commodity Traders Exchange
- Indian Oil Corporation Limited
- Global Green Power PLC Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Bangladesh Power Developement Board
- Orica Australia Pty. Ltd.
- Indian Energy Exchange, India
- Bhoruka Overseas - Indonesia
- Pendopo Energi Batubara - Indonesia
- Makarim & Taira - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Maharashtra Electricity Regulatory Commission - India
- Krishnapatnam Port Company Ltd. - India
- Kobexindo Tractors - Indoneisa
- Karaikal Port Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Singapore Mercantile Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Intertek Mineral Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- International Coal Ventures Pvt Ltd - India
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- Renaissance Capital - South Africa
- Indo Tambangraya Megah - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Parliament of New Zealand
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- Gujarat Sidhee Cement - India
- New Zealand Coal & Carbon
- Central Electricity Authority - India
- Ind-Barath Power Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Cement Manufacturers Association - India
- LBH Netherlands Bv - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Formosa Plastics Group - Taiwan
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Cigading International Bulk Terminal - Indonesia
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Bayan Resources Tbk. - Indonesia
- MS Steel International - UAE
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Interocean Group of Companies - India
- PTC India Limited - India
- Bhushan Steel Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- SMC Global Power, Philippines
- Borneo Indobara - Indonesia
- Posco Energy - South Korea
- The State Trading Corporation of India Ltd
- Coastal Gujarat Power Limited - India
- Sarangani Energy Corporation, Philippines
- Edison Trading Spa - Italy
- Iligan Light & Power Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Sakthi Sugars Limited - India
- Minerals Council of Australia
- Simpson Spence & Young - Indonesia
- Chamber of Mines of South Africa
- Sindya Power Generating Company Private Ltd
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- Savvy Resources Ltd - HongKong
- GMR Energy Limited - India
- TeaM Sual Corporation - Philippines
- ICICI Bank Limited - India
- Sojitz Corporation - Japan
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Meenaskhi Energy Private Limited - India
- Vizag Seaport Private Limited - India
- Commonwealth Bank - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Baramulti Group, Indonesia
- Ministry of Mines - Canada
- Latin American Coal - Colombia
- Mercuria Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Altura Mining Limited, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Banpu Public Company Limited - Thailand
- Jindal Steel & Power Ltd - India
- Manunggal Multi Energi - Indonesia
- The Treasury - Australian Government
- Mjunction Services Limited - India
- PowerSource Philippines DevCo
- Vijayanagar Sugar Pvt Ltd - India
- Indonesian Coal Mining Association
- Bukit Baiduri Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Toyota Tsusho Corporation, Japan
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- Straits Asia Resources Limited - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- London Commodity Brokers - England
- Neyveli Lignite Corporation Ltd, - India
- Bulk Trading Sa - Switzerland
- Energy Development Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Australian Coal Association
- Thai Mozambique Logistica
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