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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, 08 January 14
SHIPPING: THE ABSOLUTE BOTTOM OF THE CYCLE WAS REACHED AND PASSED - GEORGE LAZARIDIS
COALspot.com: To many in the industry 2013 has been the turning point in the market where the absolute bottom of the cycle was reached and passed.
...
Tuesday, 07 January 14
INDONESIA RAISES COAL PRICE THIS MONTH
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia has increased government declared coal bench mark price by US$ 1.59 / MT ...
Tuesday, 07 January 14
NEWCASTLE COAL TERMINAL'S COAL EXPORTS SLIDE TO 3.54 MMT W/E 30 DECEMBER 13
COALspot.com: In the week ended December 30, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled 3.54 ...
Tuesday, 07 January 14
US COAL OUTPUT SLIDES 9 PCT WEEK ON WEEK, EIA SAYS
COALspot.com – United States the world’s second largest coal producer, produced approximately 17.8 million short tons (mmst) of coal in ...
Monday, 06 January 14
ARGUS LAUNCHES SPOT CFR EAST COAST INDIA COAL ASSESSMENTS
COALspot.com: Global energy and commodity news and price reporting agency Argus has announced today that, the company has launched CFR coal assessme ...
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- Posco Energy - South Korea
- Jorong Barutama Greston.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Thiess Contractors Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Orica Mining Services - Indonesia
- Bukit Baiduri Energy - Indonesia
- White Energy Company Limited
- Vijayanagar Sugar Pvt Ltd - India
- Agrawal Coal Company - India
- Alfred C Toepfer International GmbH - Germany
- VISA Power Limited - India
- Salva Resources Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- Riau Bara Harum - Indonesia
- Merrill Lynch Commodities Europe
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- Therma Luzon, Inc, Philippines
- Chamber of Mines of South Africa
- Coastal Gujarat Power Limited - India
- Australian Coal Association
- Holcim Trading Pte Ltd - Singapore
- Oldendorff Carriers - Singapore
- Gujarat Electricity Regulatory Commission - India
- Globalindo Alam Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Maharashtra Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vizag Seaport Private Limited - India
- Independent Power Producers Association of India
- Rashtriya Ispat Nigam Limited - India
- GMR Energy Limited - India
- Planning Commission, India
- Bhoruka Overseas - Indonesia
- Price Waterhouse Coopers - Russia
- Siam City Cement PLC, Thailand
- Standard Chartered Bank - UAE
- Ambuja Cements Ltd - India
- Siam City Cement - Thailand
- Borneo Indobara - Indonesia
- Parliament of New Zealand
- CNBM International Corporation - China
- Grasim Industreis Ltd - India
- Simpson Spence & Young - Indonesia
- Mercator Lines Limited - India
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- PTC India Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Heidelberg Cement - Germany
- Latin American Coal - Colombia
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- PetroVietnam Power Coal Import and Supply Company
- Kapuas Tunggal Persada - Indonesia
- Baramulti Group, Indonesia
- Trasteel International SA, Italy
- Binh Thuan Hamico - Vietnam
- Deloitte Consulting - India
- LBH Netherlands Bv - Netherlands
- Pipit Mutiara Jaya. PT, Indonesia
- Chettinad Cement Corporation Ltd - India
- Rio Tinto Coal - Australia
- Sakthi Sugars Limited - India
- Bukit Makmur.PT - Indonesia
- Attock Cement Pakistan Limited
- TeaM Sual Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Thai Mozambique Logistica
- Gujarat Sidhee Cement - India
- OPG Power Generation Pvt Ltd - India
- MS Steel International - UAE
- Larsen & Toubro Limited - India
- Eastern Coal Council - USA
- TNB Fuel Sdn Bhd - Malaysia
- Karaikal Port Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Mjunction Services Limited - India
- Renaissance Capital - South Africa
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bangladesh Power Developement Board
- Bhushan Steel Limited - India
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Anglo American - United Kingdom
- Sarangani Energy Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Energy Link Ltd, New Zealand
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- SMG Consultants - Indonesia
- SMC Global Power, Philippines
- Wood Mackenzie - Singapore
- Xindia Steels Limited - India
- London Commodity Brokers - England
- Indian Energy Exchange, India
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bulk Trading Sa - Switzerland
- Singapore Mercantile Exchange
- Leighton Contractors Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- Parry Sugars Refinery, India
- Global Coal Blending Company Limited - Australia
- Sojitz Corporation - Japan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Star Paper Mills Limited - India
- Economic Council, Georgia
- McConnell Dowell - Australia
- Bhatia International Limited - India
- Ministry of Transport, Egypt
- Essar Steel Hazira Ltd - India
- Toyota Tsusho Corporation, Japan
- European Bulk Services B.V. - Netherlands
- Marubeni Corporation - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Kobexindo Tractors - Indoneisa
- IEA Clean Coal Centre - UK
- Sree Jayajothi Cements Limited - India
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- PowerSource Philippines DevCo
- Barasentosa Lestari - Indonesia
- Sical Logistics Limited - India
- Pendopo Energi Batubara - Indonesia
- The Treasury - Australian Government
- Uttam Galva Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Cement Manufacturers Association - India
- Tamil Nadu electricity Board
- Vedanta Resources Plc - India
- Ceylon Electricity Board - Sri Lanka
- Australian Commodity Traders Exchange
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Mines - Canada
- Commonwealth Bank - Australia
- Indogreen Group - Indonesia
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- Africa Commodities Group - South Africa
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- Goldman Sachs - Singapore
- Antam Resourcindo - Indonesia
- Petron Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Dalmia Cement Bharat India
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PNOC Exploration Corporation - Philippines
- Bharathi Cement Corporation - India
- CIMB Investment Bank - Malaysia
- Sindya Power Generating Company Private Ltd
- Medco Energi Mining Internasional
- Aditya Birla Group - India
- Minerals Council of Australia
- The University of Queensland
- India Bulls Power Limited - India
- SN Aboitiz Power Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Altura Mining Limited, Indonesia
- IHS Mccloskey Coal Group - USA
- Kalimantan Lumbung Energi - Indonesia
- Meralco Power Generation, Philippines
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Maheswari Brothers Coal Limited - India
- Kepco SPC Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Indian Oil Corporation Limited
- Interocean Group of Companies - India
- ASAPP Information Group - India
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Kartika Selabumi Mining - Indonesia
- Makarim & Taira - Indonesia
- Indonesian Coal Mining Association
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- Formosa Plastics Group - Taiwan
- Straits Asia Resources Limited - Singapore
- Coal and Oil Company - UAE
- Romanian Commodities Exchange
- Indika Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- ICICI Bank Limited - India
- International Coal Ventures Pvt Ltd - India
- Central Electricity Authority - India
- Kohat Cement Company Ltd. - Pakistan
- Coalindo Energy - Indonesia
- Jaiprakash Power Ventures ltd
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