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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, 19 April 13
FIRST QUARTER OF 2013 PROVEN A POSITIVE SURPRISE FOR DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite ominous predictions regarding the negative performance of the dry bulk market during the – traditionally weak anyway – first qua ...
Thursday, 18 April 13
HANDY: STABLE ; PANAMAX: BUSY WEEK - FEARNRESEARCH
Handy
The Atlantic markets remain stable in this week. The USG-Feast was at USD 19k and Black Sea-Feast was at USD 12k. The Pacific market is bit f ...
Thursday, 18 April 13
FEATURE: PREDICTING THE FUTURE - AND THE PAST - BIMCO
It’s not predicting the future that is problematical, it’s the realisation that you have to relive the past again and again when you fai ...
Wednesday, 17 April 13
INDONESIA SHIPPED 80 MILLION TONS OF COAL IN FIRST QUARTER - COAL DIRECTOR
COALspot.com - Indonesia has exported around 80 million tons of coal including power plant coal in first three months of this year.
Speaking on t ...
Tuesday, 16 April 13
AUSTRALIAN NEWCASTLE PORT'S COAL EXPORTS JUMPED 20.87 PER CENT ON WEEK TO 3.07 MMT
COALspot.com - Newcastle port in Australia has loaded 3,077,431 tons of thermal and coking coal for week ended 0700 hours 15 April 2013, Newca ...
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- Miang Besar Coal Terminal - Indonesia
- Indika Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Xindia Steels Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Mercuria Energy - Indonesia
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- PNOC Exploration Corporation - Philippines
- Essar Steel Hazira Ltd - India
- Independent Power Producers Association of India
- Sarangani Energy Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Vijayanagar Sugar Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Simpson Spence & Young - Indonesia
- Parliament of New Zealand
- IHS Mccloskey Coal Group - USA
- McConnell Dowell - Australia
- ICICI Bank Limited - India
- Bhatia International Limited - India
- Aboitiz Power Corporation - Philippines
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Karaikal Port Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Mercator Lines Limited - India
- Global Business Power Corporation, Philippines
- Videocon Industries ltd - India
- Indonesian Coal Mining Association
- Orica Mining Services - Indonesia
- Posco Energy - South Korea
- Coal and Oil Company - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Deloitte Consulting - India
- Jindal Steel & Power Ltd - India
- Sindya Power Generating Company Private Ltd
- Tata Chemicals Ltd - India
- Manunggal Multi Energi - Indonesia
- Cement Manufacturers Association - India
- SMG Consultants - Indonesia
- Meralco Power Generation, Philippines
- Malabar Cements Ltd - India
- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- Larsen & Toubro Limited - India
- Power Finance Corporation Ltd., India
- Karbindo Abesyapradhi - Indoneisa
- Trasteel International SA, Italy
- International Coal Ventures Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Chettinad Cement Corporation Ltd - India
- The University of Queensland
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- Energy Development Corp, Philippines
- Heidelberg Cement - Germany
- Australian Commodity Traders Exchange
- Kideco Jaya Agung - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Samtan Co., Ltd - South Korea
- Interocean Group of Companies - India
- Wilmar Investment Holdings
- Makarim & Taira - Indonesia
- Indian Energy Exchange, India
- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Riau Bara Harum - Indonesia
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhoruka Overseas - Indonesia
- Planning Commission, India
- Kepco SPC Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Indogreen Group - Indonesia
- South Luzon Thermal Energy Corporation
- Bukit Asam (Persero) Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Georgia Ports Authority, United States
- Jorong Barutama Greston.PT - Indonesia
- Commonwealth Bank - Australia
- Barasentosa Lestari - Indonesia
- Global Coal Blending Company Limited - Australia
- LBH Netherlands Bv - Netherlands
- Oldendorff Carriers - Singapore
- CNBM International Corporation - China
- Sinarmas Energy and Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Siam City Cement PLC, Thailand
- Orica Australia Pty. Ltd.
- Gujarat Sidhee Cement - India
- Pendopo Energi Batubara - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Rio Tinto Coal - Australia
- Energy Link Ltd, New Zealand
- AsiaOL BioFuels Corp., Philippines
- Edison Trading Spa - Italy
- Binh Thuan Hamico - Vietnam
- Jaiprakash Power Ventures ltd
- Grasim Industreis Ltd - India
- Sree Jayajothi Cements Limited - India
- European Bulk Services B.V. - Netherlands
- ASAPP Information Group - India
- Leighton Contractors Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- Carbofer General Trading SA - India
- Indo Tambangraya Megah - Indonesia
- Mjunction Services Limited - India
- Bhushan Steel Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Merrill Lynch Commodities Europe
- The Treasury - Australian Government
- Borneo Indobara - Indonesia
- Agrawal Coal Company - India
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Price Waterhouse Coopers - Russia
- Offshore Bulk Terminal Pte Ltd, Singapore
- New Zealand Coal & Carbon
- IEA Clean Coal Centre - UK
- Baramulti Group, Indonesia
- Iligan Light & Power Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- Vedanta Resources Plc - India
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- Salva Resources Pvt Ltd - India
- Ministry of Finance - Indonesia
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- GMR Energy Limited - India
- Eastern Coal Council - USA
- SN Aboitiz Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Bukit Makmur.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- Bayan Resources Tbk. - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Uttam Galva Steels Limited - India
- Minerals Council of Australia
- Eastern Energy - Thailand
- Bharathi Cement Corporation - India
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- Africa Commodities Group - South Africa
- Port Waratah Coal Services - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mintek Dendrill Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Chamber of Mines of South Africa
- Renaissance Capital - South Africa
- Bukit Baiduri Energy - Indonesia
- SMC Global Power, Philippines
- Latin American Coal - Colombia
- OPG Power Generation Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Ind-Barath Power Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Antam Resourcindo - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Siam City Cement - Thailand
- Ministry of Transport, Egypt
- VISA Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Attock Cement Pakistan Limited
- MS Steel International - UAE
- Goldman Sachs - Singapore
- Sakthi Sugars Limited - India
- Ambuja Cements Ltd - India
- White Energy Company Limited
- India Bulls Power Limited - India
- Thiess Contractors Indonesia
- Sojitz Corporation - Japan
- GAC Shipping (India) Pvt Ltd
- Star Paper Mills Limited - India
- Wood Mackenzie - Singapore
- Savvy Resources Ltd - HongKong
- Medco Energi Mining Internasional
- Standard Chartered Bank - UAE
- Lanco Infratech Ltd - India
- Intertek Mineral Services - Indonesia
- Therma Luzon, Inc, Philippines
- Indian Oil Corporation Limited
- Electricity Generating Authority of Thailand
- Madhucon Powers Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Australian Coal Association
- San Jose City I Power Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Central Java Power - Indonesia
- Kalimantan Lumbung Energi - Indonesia
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