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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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Friday, 13 September 13
DIRECTOR GENERAL OF MINERAL AND COAL OF INDONESIA REVISED UP COAL PRICE REFERENCE TO US$ 76.89
COALspot. com - The Indonesian government has revised up its owned coal bench mark price by US$ 0.19/ MT to US$ 76.89 for September 2013 deliveries ...
Thursday, 12 September 13
PANAMAX : PACIFIC ROUNDS ARE NOW REPORTED BETWEEN USD 13K AND 15K PER DAY - FEARNRESEARCH
Handy
Nickel ore is a key support SE Asia/Feast rate at the moment; vessel in N.China were fixed around USD 11-12k, ships in mid China can expect a ...
Thursday, 12 September 13
CAPESIZE MARKET WILL BECOME EVEN TIGHTER - JEFFREY LANDSBERG
COALspot.com : While it is no secret that current capesize availability has become tight and has caused capesize rates to surge, availability is set ...
Thursday, 12 September 13
OVER THE WORST? WE MIGHT FIND OUT THIS WEEK - BIMCO
The shipping market has a spring in its step, even as summer draws to a close. There is it seems, confidence that finally, we are emerging into the ...
Thursday, 12 September 13
DRY BULK MARKET RALLY COMES AT A GOOD TIME FOR MOST SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The latest surge of the dry bulk market has helped offset other lingering factors, which otherwise, could have plunged freight rates to new lows. Fo ...
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- Videocon Industries ltd - India
- Posco Energy - South Korea
- International Coal Ventures Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- Ministry of Transport, Egypt
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- Indian Energy Exchange, India
- Bahari Cakrawala Sebuku - Indonesia
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- Bhushan Steel Limited - India
- Tamil Nadu electricity Board
- PNOC Exploration Corporation - Philippines
- Bharathi Cement Corporation - India
- Romanian Commodities Exchange
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Cigading International Bulk Terminal - Indonesia
- Goldman Sachs - Singapore
- PetroVietnam Power Coal Import and Supply Company
- PowerSource Philippines DevCo
- Bulk Trading Sa - Switzerland
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Xindia Steels Limited - India
- Asmin Koalindo Tuhup - Indonesia
- European Bulk Services B.V. - Netherlands
- Kideco Jaya Agung - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- Eastern Coal Council - USA
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Medco Energi Mining Internasional
- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Chettinad Cement Corporation Ltd - India
- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- The State Trading Corporation of India Ltd
- Sarangani Energy Corporation, Philippines
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Wood Mackenzie - Singapore
- Africa Commodities Group - South Africa
- Dalmia Cement Bharat India
- Sical Logistics Limited - India
- Wilmar Investment Holdings
- Price Waterhouse Coopers - Russia
- Latin American Coal - Colombia
- Sojitz Corporation - Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coalindo Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- GMR Energy Limited - India
- Bukit Makmur.PT - Indonesia
- Central Java Power - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Thai Mozambique Logistica
- Planning Commission, India
- TeaM Sual Corporation - Philippines
- Anglo American - United Kingdom
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ASAPP Information Group - India
- GAC Shipping (India) Pvt Ltd
- Indogreen Group - Indonesia
- Global Business Power Corporation, Philippines
- New Zealand Coal & Carbon
- Semirara Mining and Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Interocean Group of Companies - India
- Metalloyd Limited - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Central Electricity Authority - India
- Petrochimia International Co. Ltd.- Taiwan
- Edison Trading Spa - Italy
- Vijayanagar Sugar Pvt Ltd - India
- Larsen & Toubro Limited - India
- Energy Link Ltd, New Zealand
- Kobexindo Tractors - Indoneisa
- Manunggal Multi Energi - Indonesia
- White Energy Company Limited
- Altura Mining Limited, Indonesia
- Merrill Lynch Commodities Europe
- Miang Besar Coal Terminal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- The University of Queensland
- Siam City Cement - Thailand
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Coal and Oil Company - UAE
- Georgia Ports Authority, United States
- Neyveli Lignite Corporation Ltd, - India
- Orica Mining Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Chamber of Mines of South Africa
- Kalimantan Lumbung Energi - Indonesia
- Electricity Generating Authority of Thailand
- Global Green Power PLC Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- ICICI Bank Limited - India
- Rio Tinto Coal - Australia
- Marubeni Corporation - India
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- Mercuria Energy - Indonesia
- Indika Energy - Indonesia
- India Bulls Power Limited - India
- Parliament of New Zealand
- Barasentosa Lestari - Indonesia
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Heidelberg Cement - Germany
- Indo Tambangraya Megah - Indonesia
- Commonwealth Bank - Australia
- South Luzon Thermal Energy Corporation
- Mjunction Services Limited - India
- Orica Australia Pty. Ltd.
- Malabar Cements Ltd - India
- Agrawal Coal Company - India
- Kohat Cement Company Ltd. - Pakistan
- Australian Commodity Traders Exchange
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Standard Chartered Bank - UAE
- Siam City Cement PLC, Thailand
- Simpson Spence & Young - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Antam Resourcindo - Indonesia
- Jaiprakash Power Ventures ltd
- McConnell Dowell - Australia
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Sinarmas Energy and Mining - Indonesia
- CNBM International Corporation - China
- Ambuja Cements Ltd - India
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Holcim Trading Pte Ltd - Singapore
- Electricity Authority, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Star Paper Mills Limited - India
- London Commodity Brokers - England
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Timah Investasi Mineral - Indoneisa
- GVK Power & Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Karaikal Port Pvt Ltd - India
- Carbofer General Trading SA - India
- Intertek Mineral Services - Indonesia
- Attock Cement Pakistan Limited
- Meenaskhi Energy Private Limited - India
- Bhatia International Limited - India
- Power Finance Corporation Ltd., India
- Toyota Tsusho Corporation, Japan
- Petron Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Coastal Gujarat Power Limited - India
- Aditya Birla Group - India
- Salva Resources Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Riau Bara Harum - Indonesia
- Samtan Co., Ltd - South Korea
- Deloitte Consulting - India
- Singapore Mercantile Exchange
- Kapuas Tunggal Persada - Indonesia
- Sakthi Sugars Limited - India
- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- Baramulti Group, Indonesia
- MS Steel International - UAE
- SMG Consultants - Indonesia
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Economic Council, Georgia
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Global Coal Blending Company Limited - Australia
- Formosa Plastics Group - Taiwan
- Bukit Baiduri Energy - Indonesia
- Minerals Council of Australia
- Trasteel International SA, Italy
- IHS Mccloskey Coal Group - USA
- Mintek Dendrill Indonesia
- Parry Sugars Refinery, India
- SMC Global Power, Philippines
- Independent Power Producers Association of India
- Vedanta Resources Plc - India
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- Kumho Petrochemical, South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Borneo Indobara - Indonesia
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