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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, 05 September 13
DRY BULK MARKET ON A HIGH ROLL, MAINLY THANKS TO CAPESIZE APPETITE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Capesize owners have been rejoycing on the back of renewed optimism for the further rise in the dry bulk market's freight rates, especially when on ...
Wednesday, 04 September 13
RBCT SHIPPED 16.18 PERCENT MORE COAL IN JULY
COALspot.com - Richards Bay Coal Terminal (RBCT) is the single largest coal export terminal South African as well as in the world has shipped 6,162, ...
Wednesday, 04 September 13
SUPRAS AND HANDIES : INDONESIAN COAL CARGOES ARE SUPPORTING HEALTHY ACTIVITY LEVELS - INTERMODAL
The Dry Bulk market has pooled back a bit this week after firming for two weeks in a row. The BDI is s holding above 1,100 points and despite the sm ...
Tuesday, 03 September 13
AUSTRALIA'S NEWCASTLE PORT SHIPPED 22.93 PER CENT MORE COAL W-O-W
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port up 22.93 per cent week on week to 3.39 million mt for ...
Sunday, 01 September 13
COAL SWAP SHOWS MIXED TREND
COALspot.com – Sub-Bit Indonesia coal swaps (FOB ) for average Q4 2013 delivery 1.25 percent up month on month. The swap was moved posit ...
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- Orica Australia Pty. Ltd.
- Tamil Nadu electricity Board
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- Energy Link Ltd, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Eastern Coal Council - USA
- Malabar Cements Ltd - India
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- Posco Energy - South Korea
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- McConnell Dowell - Australia
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- Economic Council, Georgia
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- Bhushan Steel Limited - India
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- Thai Mozambique Logistica
- London Commodity Brokers - England
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- Commonwealth Bank - Australia
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- Indonesian Coal Mining Association
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- Maharashtra Electricity Regulatory Commission - India
- Wilmar Investment Holdings
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- Power Finance Corporation Ltd., India
- Minerals Council of Australia
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- Australian Coal Association
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- CNBM International Corporation - China
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- Timah Investasi Mineral - Indoneisa
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- MS Steel International - UAE
- Altura Mining Limited, Indonesia
- Aboitiz Power Corporation - Philippines
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- Central Electricity Authority - India
- Ministry of Transport, Egypt
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
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- Carbofer General Trading SA - India
- Electricity Authority, New Zealand
- Anglo American - United Kingdom
- Formosa Plastics Group - Taiwan
- Essar Steel Hazira Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Eastern Energy - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Jaiprakash Power Ventures ltd
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Goldman Sachs - Singapore
- Uttam Galva Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Sojitz Corporation - Japan
- LBH Netherlands Bv - Netherlands
- Port Waratah Coal Services - Australia
- ASAPP Information Group - India
- Gujarat Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Indo Tambangraya Megah - Indonesia
- Chamber of Mines of South Africa
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- SMC Global Power, Philippines
- Videocon Industries ltd - India
- GVK Power & Infra Limited - India
- Borneo Indobara - Indonesia
- Dalmia Cement Bharat India
- Africa Commodities Group - South Africa
- ICICI Bank Limited - India
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Independent Power Producers Association of India
- PTC India Limited - India
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- GMR Energy Limited - India
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Agrawal Coal Company - India
- Salva Resources Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Parliament of New Zealand
- Romanian Commodities Exchange
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- Straits Asia Resources Limited - Singapore
- Metalloyd Limited - United Kingdom
- Bhatia International Limited - India
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Siam City Cement PLC, Thailand
- Siam City Cement - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- VISA Power Limited - India
- Madhucon Powers Ltd - India
- Planning Commission, India
- Mercator Lines Limited - India
- Bayan Resources Tbk. - Indonesia
- European Bulk Services B.V. - Netherlands
- Gujarat Mineral Development Corp Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Aditya Birla Group - India
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- Kideco Jaya Agung - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Kartika Selabumi Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- Alfred C Toepfer International GmbH - Germany
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Marubeni Corporation - India
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indogreen Group - Indonesia
- Samtan Co., Ltd - South Korea
- Jorong Barutama Greston.PT - Indonesia
- Rio Tinto Coal - Australia
- GN Power Mariveles Coal Plant, Philippines
- Medco Energi Mining Internasional
- Simpson Spence & Young - Indonesia
- Interocean Group of Companies - India
- Georgia Ports Authority, United States
- Price Waterhouse Coopers - Russia
- Maheswari Brothers Coal Limited - India
- Ministry of Mines - Canada
- Deloitte Consulting - India
- Xindia Steels Limited - India
- Bangladesh Power Developement Board
- PNOC Exploration Corporation - Philippines
- Cement Manufacturers Association - India
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Edison Trading Spa - Italy
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Antam Resourcindo - Indonesia
- Karaikal Port Pvt Ltd - India
- New Zealand Coal & Carbon
- Latin American Coal - Colombia
- Coalindo Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- Indian Oil Corporation Limited
- Meralco Power Generation, Philippines
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Larsen & Toubro Limited - India
- The University of Queensland
- TeaM Sual Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Parry Sugars Refinery, India
- Sarangani Energy Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Holcim Trading Pte Ltd - Singapore
- White Energy Company Limited
- Bulk Trading Sa - Switzerland
- Ministry of Finance - Indonesia
- Mjunction Services Limited - India
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- Kaltim Prima Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- Global Coal Blending Company Limited - Australia
- International Coal Ventures Pvt Ltd - India
- Vedanta Resources Plc - India
- Kobexindo Tractors - Indoneisa
- SN Aboitiz Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Australian Commodity Traders Exchange
- Meenaskhi Energy Private Limited - India
- Merrill Lynch Commodities Europe
- TNB Fuel Sdn Bhd - Malaysia
- Mercuria Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Manunggal Multi Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- Bharathi Cement Corporation - India
- Ind-Barath Power Infra Limited - India
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