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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, 28 January 14
RESOURCE NATIONALISM OR PROTECTIONISM FOR THE MINING AND EXTRACTIVES INDUSTRY - JOHN WHITTAKER & MICHAEL SWANGARD
Resource nationalism or protectionism for the mining and extractives industry as well as soft commodities sector and the oil industry.
‘Res ...
Tuesday, 28 January 14
DRY BULK SHIP OWNERS RETREAT TO OLD 'HABITS', REFUSING TO DEMOLISH OLD VESSELS, THREATENING MARKET RECOVERY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
If one thing is clear as we reflect on the 2013 shipping markets, it's that ship owners took advantage of low prices, in order to acquire newer ton ...
Monday, 27 January 14
MERCATOR SINGAPORE REPORTS 52% INCREASE IN EBITDA FOR Q3 FY 2014 AS COMPARED TO PREVIOUS QUARTER
COALspot.com: Mercator Lines (Singapore) Limited, a leading Indian-owned international dry bulk shipping company that operates a fleet of fourteen d ...
Monday, 27 January 14
13TH CLEAN COAL FORUM 2014
COALspot.com: (Press Release) - Produced by CDMC Events, The 13th Clean Coal Forum 2014 will be held on June 12 &13 2014 in Beijing, China. We a ...
Monday, 27 January 14
Q3 & Q4 API 8 CFR SOUTH CHINA COAL SWAPS CONTINUE TO REMAIN WEAK
COALspot.com: API 8 CFR South China Coal swaps for average Q1 14 delivery lost 4.45 percent month on month and closed at US$ 79.05 per mt as on Frid ...
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- Minerals Council of Australia
- Bharathi Cement Corporation - India
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- Ministry of Mines - Canada
- Port Waratah Coal Services - Australia
- Parliament of New Zealand
- ICICI Bank Limited - India
- Formosa Plastics Group - Taiwan
- AsiaOL BioFuels Corp., Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- Mercuria Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Ministry of Transport, Egypt
- Coalindo Energy - Indonesia
- Tata Chemicals Ltd - India
- Bhatia International Limited - India
- IEA Clean Coal Centre - UK
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Orica Mining Services - Indonesia
- Coastal Gujarat Power Limited - India
- Petron Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Australian Coal Association
- Bangladesh Power Developement Board
- Sojitz Corporation - Japan
- Manunggal Multi Energi - Indonesia
- Indogreen Group - Indonesia
- Kartika Selabumi Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Intertek Mineral Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Wilmar Investment Holdings
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Merrill Lynch Commodities Europe
- Sical Logistics Limited - India
- Rashtriya Ispat Nigam Limited - India
- Indian Energy Exchange, India
- Mjunction Services Limited - India
- European Bulk Services B.V. - Netherlands
- Bulk Trading Sa - Switzerland
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The University of Queensland
- GMR Energy Limited - India
- SMC Global Power, Philippines
- Goldman Sachs - Singapore
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- Anglo American - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- VISA Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Sree Jayajothi Cements Limited - India
- Riau Bara Harum - Indonesia
- Cement Manufacturers Association - India
- Renaissance Capital - South Africa
- Bhoruka Overseas - Indonesia
- Carbofer General Trading SA - India
- Heidelberg Cement - Germany
- Altura Mining Limited, Indonesia
- McConnell Dowell - Australia
- Central Java Power - Indonesia
- Mercator Lines Limited - India
- Interocean Group of Companies - India
- Chamber of Mines of South Africa
- Bukit Makmur.PT - Indonesia
- Indonesian Coal Mining Association
- Gujarat Mineral Development Corp Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- Global Green Power PLC Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Electricity Authority, New Zealand
- Simpson Spence & Young - Indonesia
- Kumho Petrochemical, South Korea
- Australian Commodity Traders Exchange
- Posco Energy - South Korea
- Vedanta Resources Plc - India
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parry Sugars Refinery, India
- Bahari Cakrawala Sebuku - Indonesia
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Economic Council, Georgia
- Vijayanagar Sugar Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Eastern Energy - Thailand
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Videocon Industries ltd - India
- Ind-Barath Power Infra Limited - India
- Rio Tinto Coal - Australia
- Cigading International Bulk Terminal - Indonesia
- Wood Mackenzie - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Samtan Co., Ltd - South Korea
- Attock Cement Pakistan Limited
- Kepco SPC Power Corporation, Philippines
- Madhucon Powers Ltd - India
- India Bulls Power Limited - India
- Chettinad Cement Corporation Ltd - India
- GVK Power & Infra Limited - India
- Jaiprakash Power Ventures ltd
- Ambuja Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- Eastern Coal Council - USA
- International Coal Ventures Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- South Luzon Thermal Energy Corporation
- Indo Tambangraya Megah - Indonesia
- Global Coal Blending Company Limited - Australia
- Iligan Light & Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- Therma Luzon, Inc, Philippines
- London Commodity Brokers - England
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Commonwealth Bank - Australia
- Energy Link Ltd, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Power Finance Corporation Ltd., India
- Binh Thuan Hamico - Vietnam
- Gujarat Sidhee Cement - India
- IHS Mccloskey Coal Group - USA
- ASAPP Information Group - India
- Indian Oil Corporation Limited
- Edison Trading Spa - Italy
- Borneo Indobara - Indonesia
- Aditya Birla Group - India
- Jindal Steel & Power Ltd - India
- Star Paper Mills Limited - India
- TeaM Sual Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Petrochimia International Co. Ltd.- Taiwan
- Meralco Power Generation, Philippines
- Romanian Commodities Exchange
- LBH Netherlands Bv - Netherlands
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- Kaltim Prima Coal - Indonesia
- Deloitte Consulting - India
- Latin American Coal - Colombia
- The State Trading Corporation of India Ltd
- Salva Resources Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Makarim & Taira - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Straits Asia Resources Limited - Singapore
- Larsen & Toubro Limited - India
- Agrawal Coal Company - India
- Global Business Power Corporation, Philippines
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- Electricity Generating Authority of Thailand
- Miang Besar Coal Terminal - Indonesia
- Savvy Resources Ltd - HongKong
- Trasteel International SA, Italy
- Semirara Mining and Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Georgia Ports Authority, United States
- New Zealand Coal & Carbon
- Xindia Steels Limited - India
- CNBM International Corporation - China
- Singapore Mercantile Exchange
- Malabar Cements Ltd - India
- San Jose City I Power Corp, Philippines
- Central Electricity Authority - India
- Tamil Nadu electricity Board
- SN Aboitiz Power Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Independent Power Producers Association of India
- Baramulti Group, Indonesia
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- White Energy Company Limited
- Holcim Trading Pte Ltd - Singapore
- Sinarmas Energy and Mining - Indonesia
- Orica Australia Pty. Ltd.
- PTC India Limited - India
- Dalmia Cement Bharat India
- Planning Commission, India
- Kobexindo Tractors - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Karaikal Port Pvt Ltd - India
- Mintek Dendrill Indonesia
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