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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, 12 February 14
NEW BUILDING ORDERS REACHING NEW POST-CRISIS HEIGHTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Ship owners are looking to take advantage of the last few attractive deals in the new building market, before prices start climbing to new highs and ...
Wednesday, 12 February 14
2013 WAS THE YEAR OF PRIVATE EQUITY FUNDING - TIMOS PAPADIMITRIOU
COALspot.com: People say that money makes the world go round. Well, can it be that it’s the other way around? Is it possible that money needs ...
Tuesday, 11 February 14
INDONESIAN COAL SWAP SHOWS STRONG GROWTH IN 2014 SECOND HALF
COALspot.com – Swaps prices slide for thermal coal loading from Indonesia, the world’s largest exporter of the fuel, according SGX.
T ...
Tuesday, 11 February 14
AUSTRALIA'S NEWCASTLE COAL EXPORTS SLIDE AROUND 15% WEEK ON WEEK
COALspot.com: In the week ended 10 February 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled ...
Tuesday, 11 February 14
SHIP OWNERS INVEST IN 447 NEWBUILDINGS AND SECOND HAND VESSELS DURING JANUARY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite a rough start to the year for the dry bulk freight market and lackluster performance from most other shipping sub-segments, ship owners have ...
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- Global Green Power PLC Corporation, Philippines
- Salva Resources Pvt Ltd - India
- CNBM International Corporation - China
- Bhoruka Overseas - Indonesia
- GAC Shipping (India) Pvt Ltd
- Kohat Cement Company Ltd. - Pakistan
- Bayan Resources Tbk. - Indonesia
- Australian Coal Association
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining Corp, Philippines
- Thiess Contractors Indonesia
- Bulk Trading Sa - Switzerland
- Sinarmas Energy and Mining - Indonesia
- Ind-Barath Power Infra Limited - India
- Heidelberg Cement - Germany
- Coastal Gujarat Power Limited - India
- Mercuria Energy - Indonesia
- Ministry of Finance - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Commodity Traders Exchange
- Mintek Dendrill Indonesia
- European Bulk Services B.V. - Netherlands
- Bhushan Steel Limited - India
- South Luzon Thermal Energy Corporation
- Gujarat Sidhee Cement - India
- White Energy Company Limited
- Romanian Commodities Exchange
- Thai Mozambique Logistica
- Formosa Plastics Group - Taiwan
- Gujarat Mineral Development Corp Ltd - India
- Indika Energy - Indonesia
- Indian Oil Corporation Limited
- The State Trading Corporation of India Ltd
- SN Aboitiz Power Inc, Philippines
- Parry Sugars Refinery, India
- Central Electricity Authority - India
- Global Coal Blending Company Limited - Australia
- SMG Consultants - Indonesia
- Directorate Of Revenue Intelligence - India
- CIMB Investment Bank - Malaysia
- Agrawal Coal Company - India
- Posco Energy - South Korea
- Marubeni Corporation - India
- Jindal Steel & Power Ltd - India
- Carbofer General Trading SA - India
- The University of Queensland
- Petron Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Bharathi Cement Corporation - India
- Wood Mackenzie - Singapore
- Vizag Seaport Private Limited - India
- Baramulti Group, Indonesia
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Deloitte Consulting - India
- Billiton Holdings Pty Ltd - Australia
- Altura Mining Limited, Indonesia
- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- Ambuja Cements Ltd - India
- Wilmar Investment Holdings
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- McConnell Dowell - Australia
- Therma Luzon, Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- Energy Link Ltd, New Zealand
- Chamber of Mines of South Africa
- Borneo Indobara - Indonesia
- Kobexindo Tractors - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- Electricity Authority, New Zealand
- Commonwealth Bank - Australia
- Coalindo Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Planning Commission, India
- Parliament of New Zealand
- Eastern Energy - Thailand
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- Power Finance Corporation Ltd., India
- OPG Power Generation Pvt Ltd - India
- Madhucon Powers Ltd - India
- Merrill Lynch Commodities Europe
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- MS Steel International - UAE
- Oldendorff Carriers - Singapore
- SMC Global Power, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Medco Energi Mining Internasional
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Maheswari Brothers Coal Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Intertek Mineral Services - Indonesia
- Energy Development Corp, Philippines
- Indian Energy Exchange, India
- PNOC Exploration Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Meralco Power Generation, Philippines
- Tamil Nadu electricity Board
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kideco Jaya Agung - Indonesia
- Meenaskhi Energy Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Manunggal Multi Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- Riau Bara Harum - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Makmur.PT - Indonesia
- Savvy Resources Ltd - HongKong
- Malabar Cements Ltd - India
- Goldman Sachs - Singapore
- Grasim Industreis Ltd - India
- Economic Council, Georgia
- Independent Power Producers Association of India
- Kumho Petrochemical, South Korea
- IEA Clean Coal Centre - UK
- Bukit Asam (Persero) Tbk - Indonesia
- Aditya Birla Group - India
- Africa Commodities Group - South Africa
- Pendopo Energi Batubara - Indonesia
- Makarim & Taira - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Siam City Cement - Thailand
- Leighton Contractors Pty Ltd - Australia
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Videocon Industries ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Antam Resourcindo - Indonesia
- Trasteel International SA, Italy
- TeaM Sual Corporation - Philippines
- Georgia Ports Authority, United States
- Tata Chemicals Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Sojitz Corporation - Japan
- Standard Chartered Bank - UAE
- Globalindo Alam Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Mines - Canada
- Dalmia Cement Bharat India
- Indonesian Coal Mining Association
- AsiaOL BioFuels Corp., Philippines
- Mercator Lines Limited - India
- IHS Mccloskey Coal Group - USA
- Edison Trading Spa - Italy
- Electricity Generating Authority of Thailand
- Bangladesh Power Developement Board
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement PLC, Thailand
- Timah Investasi Mineral - Indoneisa
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Uttam Galva Steels Limited - India
- Port Waratah Coal Services - Australia
- ASAPP Information Group - India
- New Zealand Coal & Carbon
- Vedanta Resources Plc - India
- The Treasury - Australian Government
- Asmin Koalindo Tuhup - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Simpson Spence & Young - Indonesia
- Rio Tinto Coal - Australia
- Orica Australia Pty. Ltd.
- Cement Manufacturers Association - India
- Banpu Public Company Limited - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Lanco Infratech Ltd - India
- ICICI Bank Limited - India
- Gujarat Electricity Regulatory Commission - India
- Samtan Co., Ltd - South Korea
- VISA Power Limited - India
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Mjunction Services Limited - India
- Semirara Mining and Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Kapuas Tunggal Persada - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Iligan Light & Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Attock Cement Pakistan Limited
- Interocean Group of Companies - India
- Sindya Power Generating Company Private Ltd
- Sakthi Sugars Limited - India
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Sical Logistics Limited - India
- Central Java Power - Indonesia
- Holcim Trading Pte Ltd - Singapore
- GVK Power & Infra Limited - India
- Bhatia International Limited - India
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- San Jose City I Power Corp, Philippines
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