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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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Thursday, 10 October 13
SEVERAL PANAMAX FIXTURES FOR 1 YEAR TC HAVE BEEN REPORTED AROUND $13.5K/DAY - FEARNRESEARCH
Handy
The market is not much fancy as several holidays in the Far East last week. Tonnage side seems tight in SE Asia but there are many of them in ...
Wednesday, 09 October 13
PANAMAX: FIRM ; FIXING ACTIVITY INCREASED IN BOTH BASINS - INTERMODAL
This was another week of gains for the Dry Bulk market, albeit very modest ones compared to the previous ones. Charterers and owners struggled for t ...
Tuesday, 08 October 13
CHINA: INTENSE COMPETITION AMONG DOMESTIC COAL MINERS AS 2013 IMPORT DEMAND REMAINS STRONG - WOOD MACKENZIE
Prices will not fall under RMB500/t or risk supply availability to the coastal market
Despite China's lower economic growth, Wood Mackenzie says ...
Monday, 07 October 13
RICHARD BAY COAL TERMINAL SHIPPED 49.94 MMT OF COAL YTD
COALspot.com - Richards Bay Coal Terminal (RBCT), the world's single largest coal terminal has shipped 49,946,509 mt of coals YTD, according to por ...
Monday, 07 October 13
SOUTH AFRICA'S RBCT SHIPPED 7.94% MORE COAL IN SEPT' 13
COALspot.com - Richards Bay Coal Terminal (RBCT), the single largest coal export terminal in South Africa as well as in the world has shipped 7.94 p ...
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- Krishnapatnam Port Company Ltd. - India
- Sakthi Sugars Limited - India
- Goldman Sachs - Singapore
- Port Waratah Coal Services - Australia
- Posco Energy - South Korea
- Romanian Commodities Exchange
- Gujarat Mineral Development Corp Ltd - India
- Ind-Barath Power Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Coalindo Energy - Indonesia
- IEA Clean Coal Centre - UK
- Therma Luzon, Inc, Philippines
- White Energy Company Limited
- Jindal Steel & Power Ltd - India
- The Treasury - Australian Government
- Chettinad Cement Corporation Ltd - India
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- Billiton Holdings Pty Ltd - Australia
- Price Waterhouse Coopers - Russia
- Bhoruka Overseas - Indonesia
- Salva Resources Pvt Ltd - India
- Lanco Infratech Ltd - India
- Ministry of Mines - Canada
- PetroVietnam Power Coal Import and Supply Company
- Dalmia Cement Bharat India
- Electricity Authority, New Zealand
- Gujarat Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Pendopo Energi Batubara - Indonesia
- Malabar Cements Ltd - India
- Georgia Ports Authority, United States
- Sindya Power Generating Company Private Ltd
- The State Trading Corporation of India Ltd
- Videocon Industries ltd - India
- Africa Commodities Group - South Africa
- SMG Consultants - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Tamil Nadu electricity Board
- Australian Commodity Traders Exchange
- Sree Jayajothi Cements Limited - India
- Carbofer General Trading SA - India
- Samtan Co., Ltd - South Korea
- India Bulls Power Limited - India
- Aboitiz Power Corporation - Philippines
- Indonesian Coal Mining Association
- Petron Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Rio Tinto Coal - Australia
- Holcim Trading Pte Ltd - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Karaikal Port Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- Makarim & Taira - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Medco Energi Mining Internasional
- Global Business Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Intertek Mineral Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- Manunggal Multi Energi - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- ICICI Bank Limited - India
- Borneo Indobara - Indonesia
- Directorate Of Revenue Intelligence - India
- Siam City Cement PLC, Thailand
- Vedanta Resources Plc - India
- Orica Mining Services - Indonesia
- South Luzon Thermal Energy Corporation
- Kepco SPC Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Power Finance Corporation Ltd., India
- Simpson Spence & Young - Indonesia
- Globalindo Alam Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Coastal Gujarat Power Limited - India
- Central Electricity Authority - India
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- ASAPP Information Group - India
- Global Coal Blending Company Limited - Australia
- Sinarmas Energy and Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Marubeni Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Grasim Industreis Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Indian Energy Exchange, India
- Alfred C Toepfer International GmbH - Germany
- Toyota Tsusho Corporation, Japan
- Aditya Birla Group - India
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- Trasteel International SA, Italy
- Antam Resourcindo - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PTC India Limited - India
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mjunction Services Limited - India
- Bharathi Cement Corporation - India
- Asmin Koalindo Tuhup - Indonesia
- GAC Shipping (India) Pvt Ltd
- Deloitte Consulting - India
- Anglo American - United Kingdom
- Singapore Mercantile Exchange
- Thai Mozambique Logistica
- Eastern Coal Council - USA
- Pipit Mutiara Jaya. PT, Indonesia
- Mintek Dendrill Indonesia
- Coal and Oil Company - UAE
- Ambuja Cements Ltd - India
- San Jose City I Power Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- The University of Queensland
- Edison Trading Spa - Italy
- International Coal Ventures Pvt Ltd - India
- Agrawal Coal Company - India
- Standard Chartered Bank - UAE
- Cigading International Bulk Terminal - Indonesia
- Star Paper Mills Limited - India
- Minerals Council of Australia
- Kohat Cement Company Ltd. - Pakistan
- Chamber of Mines of South Africa
- Kapuas Tunggal Persada - Indonesia
- PNOC Exploration Corporation - Philippines
- MS Steel International - UAE
- Global Green Power PLC Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Economic Council, Georgia
- SMC Global Power, Philippines
- Kaltim Prima Coal - Indonesia
- GVK Power & Infra Limited - India
- Banpu Public Company Limited - Thailand
- Jaiprakash Power Ventures ltd
- Siam City Cement - Thailand
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Latin American Coal - Colombia
- Mercuria Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- European Bulk Services B.V. - Netherlands
- Electricity Generating Authority of Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Attock Cement Pakistan Limited
- Larsen & Toubro Limited - India
- Renaissance Capital - South Africa
- Baramulti Group, Indonesia
- Bangladesh Power Developement Board
- Heidelberg Cement - Germany
- Sarangani Energy Corporation, Philippines
- Bhushan Steel Limited - India
- Essar Steel Hazira Ltd - India
- Bulk Trading Sa - Switzerland
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Energy Development Corp, Philippines
- Indogreen Group - Indonesia
- Madhucon Powers Ltd - India
- Oldendorff Carriers - Singapore
- Merrill Lynch Commodities Europe
- Vizag Seaport Private Limited - India
- Energy Link Ltd, New Zealand
- Leighton Contractors Pty Ltd - Australia
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Meenaskhi Energy Private Limited - India
- Binh Thuan Hamico - Vietnam
- New Zealand Coal & Carbon
- Sojitz Corporation - Japan
- OPG Power Generation Pvt Ltd - India
- Xindia Steels Limited - India
- Tata Chemicals Ltd - India
- Orica Australia Pty. Ltd.
- London Commodity Brokers - England
- Uttam Galva Steels Limited - India
- Central Java Power - Indonesia
- VISA Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Barasentosa Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Interocean Group of Companies - India
- Bukit Asam (Persero) Tbk - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Cement Manufacturers Association - India
- Sical Logistics Limited - India
- McConnell Dowell - Australia
- Wilmar Investment Holdings
- TeaM Sual Corporation - Philippines
- Mercator Lines Limited - India
- Bhatia International Limited - India
- CIMB Investment Bank - Malaysia
- GMR Energy Limited - India
- PowerSource Philippines DevCo
- TNB Fuel Sdn Bhd - Malaysia
- CNBM International Corporation - China
- Gujarat Sidhee Cement - India
- Independent Power Producers Association of India
- Indika Energy - Indonesia
- Australian Coal Association
- Ministry of Transport, Egypt
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