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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, 26 September 13
INTERCARGO PUBLISHES BENCHMARKING BULK CARRIERS 2012-13 REPORT
The International Association of Dry Cargo Shipowners (Intercargo) has today launched Benchmarking Bulk Carriers 2012-13, the latest edition of our ...
Thursday, 26 September 13
DRY BULK MARKET KEEPS ON RALLYING ON THE BACK OF HIGH CAPESIZE DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has kept its momentum over the course of the past week, on the back of increased demand for Capesizes and an improvement of mark ...
Wednesday, 25 September 13
RBCT'S COAL EXPORT DECLINES IN AUGUST
COALspot.com - Richards Bay Coal Terminal (RBCT) is the single largest coal export terminal in South African as well as in the world has shipped 16. ...
Wednesday, 25 September 13
CAPES TOUCHING RATES NO ONE BELIEVED COULD BE ACHIEVED IN 2013 - INTERMODAL
Chartering (Wet: Stable- / Dry: Firm+ )
The Dry Bulk market is the gift that keeps on giving these days. With rates for Capes touching numbers ...
Wednesday, 25 September 13
IS IT TIME AGAIN TO SUPERSIZE AGAIN? - GEORGE LAZARIDIS
After an early arrival of the seasonal rally in the Capesize market, things look to be on the upbeat for these dry bulk giants. With the Index reach ...
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- Bukit Makmur.PT - Indonesia
- Thiess Contractors Indonesia
- LBH Netherlands Bv - Netherlands
- Anglo American - United Kingdom
- Global Business Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Maheswari Brothers Coal Limited - India
- Antam Resourcindo - Indonesia
- Ind-Barath Power Infra Limited - India
- Ministry of Finance - Indonesia
- ICICI Bank Limited - India
- Energy Development Corp, Philippines
- Attock Cement Pakistan Limited
- Timah Investasi Mineral - Indoneisa
- SMC Global Power, Philippines
- Posco Energy - South Korea
- Mercuria Energy - Indonesia
- PowerSource Philippines DevCo
- Madhucon Powers Ltd - India
- Minerals Council of Australia
- Aboitiz Power Corporation - Philippines
- Wilmar Investment Holdings
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- PetroVietnam Power Coal Import and Supply Company
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Sojitz Corporation - Japan
- Holcim Trading Pte Ltd - Singapore
- Globalindo Alam Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- White Energy Company Limited
- Siam City Cement PLC, Thailand
- Medco Energi Mining Internasional
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Global Coal Blending Company Limited - Australia
- Eastern Coal Council - USA
- Commonwealth Bank - Australia
- Samtan Co., Ltd - South Korea
- Sarangani Energy Corporation, Philippines
- Orica Mining Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Kohat Cement Company Ltd. - Pakistan
- India Bulls Power Limited - India
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- Kaltim Prima Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- GAC Shipping (India) Pvt Ltd
- The University of Queensland
- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Transport, Egypt
- Petron Corporation, Philippines
- Tata Chemicals Ltd - India
- Bangladesh Power Developement Board
- Oldendorff Carriers - Singapore
- Aditya Birla Group - India
- PTC India Limited - India
- Billiton Holdings Pty Ltd - Australia
- Vedanta Resources Plc - India
- Miang Besar Coal Terminal - Indonesia
- Kideco Jaya Agung - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PNOC Exploration Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- New Zealand Coal & Carbon
- Makarim & Taira - Indonesia
- The State Trading Corporation of India Ltd
- Sinarmas Energy and Mining - Indonesia
- Australian Commodity Traders Exchange
- Deloitte Consulting - India
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Essar Steel Hazira Ltd - India
- MS Steel International - UAE
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Kumho Petrochemical, South Korea
- Electricity Authority, New Zealand
- Coalindo Energy - Indonesia
- Thai Mozambique Logistica
- Borneo Indobara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Ambuja Cements Ltd - India
- McConnell Dowell - Australia
- Port Waratah Coal Services - Australia
- Chettinad Cement Corporation Ltd - India
- Central Electricity Authority - India
- Planning Commission, India
- Latin American Coal - Colombia
- Cigading International Bulk Terminal - Indonesia
- Australian Coal Association
- Directorate Of Revenue Intelligence - India
- Therma Luzon, Inc, Philippines
- Energy Link Ltd, New Zealand
- Bhushan Steel Limited - India
- GVK Power & Infra Limited - India
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
- CNBM International Corporation - China
- Mercator Lines Limited - India
- Larsen & Toubro Limited - India
- Semirara Mining Corp, Philippines
- Heidelberg Cement - Germany
- Intertek Mineral Services - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mjunction Services Limited - India
- Rio Tinto Coal - Australia
- Sree Jayajothi Cements Limited - India
- Leighton Contractors Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Metalloyd Limited - United Kingdom
- Edison Trading Spa - Italy
- Binh Thuan Hamico - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Power Finance Corporation Ltd., India
- European Bulk Services B.V. - Netherlands
- Sical Logistics Limited - India
- Indika Energy - Indonesia
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Malabar Cements Ltd - India
- Marubeni Corporation - India
- Bharathi Cement Corporation - India
- Mintek Dendrill Indonesia
- Economic Council, Georgia
- IHS Mccloskey Coal Group - USA
- Bukit Asam (Persero) Tbk - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bhatia International Limited - India
- Riau Bara Harum - Indonesia
- Jaiprakash Power Ventures ltd
- Kapuas Tunggal Persada - Indonesia
- Indonesian Coal Mining Association
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Romanian Commodities Exchange
- Interocean Group of Companies - India
- Neyveli Lignite Corporation Ltd, - India
- Trasteel International SA, Italy
- Karbindo Abesyapradhi - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Barasentosa Lestari - Indonesia
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- OPG Power Generation Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Chamber of Mines of South Africa
- Pendopo Energi Batubara - Indonesia
- VISA Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Coal and Oil Company - UAE
- Grasim Industreis Ltd - India
- Electricity Generating Authority of Thailand
- London Commodity Brokers - England
- Gujarat Sidhee Cement - India
- The Treasury - Australian Government
- Altura Mining Limited, Indonesia
- Goldman Sachs - Singapore
- Independent Power Producers Association of India
- Simpson Spence & Young - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Africa Commodities Group - South Africa
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- ASAPP Information Group - India
- Baramulti Group, Indonesia
- Vizag Seaport Private Limited - India
- Bulk Trading Sa - Switzerland
- Meenaskhi Energy Private Limited - India
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Coastal Gujarat Power Limited - India
- Banpu Public Company Limited - Thailand
- TeaM Sual Corporation - Philippines
- GMR Energy Limited - India
- Merrill Lynch Commodities Europe
- Indogreen Group - Indonesia
- CIMB Investment Bank - Malaysia
- Tamil Nadu electricity Board
- Directorate General of MIneral and Coal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Georgia Ports Authority, United States
- Indian Energy Exchange, India
- Gujarat Electricity Regulatory Commission - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Singapore Mercantile Exchange
- Iligan Light & Power Inc, Philippines
- IEA Clean Coal Centre - UK
- Orica Australia Pty. Ltd.
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