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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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Monday, 11 March 13
SUB-BIT FOB INDONESIA COAL SWAPS FELL 1.41 PERCENT W-W
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q2’ 2013 delivery has lost 1.41percent and CFR South China coal shipment ...
Sunday, 10 March 13
INDIA - INDONESIA SUPRAMAX FREIGHT : FIRM TREND
COALspot.com – This week freight market was raised and remained firm in all segments.
The BDI was up by 6.70 pct closed at 843 points, ...
Sunday, 10 March 13
INDONESIA'S FORESTRY DEPARTMENT IS TO INCREASE BORROW-TO-USE PERMITS (IJIN PINJAM PAKAI) FEE SOON
COALspot.com : Indonesia to increase borrows-to-use permit fees by 33.33 percent. The government of Indonesia is planning to increase the state&rsqu ...
Friday, 08 March 13
EKO SANTOSO BUDIANTO APPOINTED AS PRESDIENT DIRECTOR OF BERAU COAL ENERGY
COALspot.com - PT Berau Coal Energy has appointed Eko Santoso Budianto as new president director, replacing Rosan Roeslani. Berau’s extraordin ...
Friday, 08 March 13
INDONESIAN HBA UP FOR FIVE CONSECUTIVE MONTHS
COALspot.com - The Indonesian government has declared bench mark price for coal has moved upwards in March 2013.
The monthly coal reference ...
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- Jorong Barutama Greston.PT - Indonesia
- GVK Power & Infra Limited - India
- Madhucon Powers Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- Ambuja Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- MS Steel International - UAE
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Tamil Nadu electricity Board
- Therma Luzon, Inc, Philippines
- European Bulk Services B.V. - Netherlands
- Chamber of Mines of South Africa
- Energy Link Ltd, New Zealand
- Tata Chemicals Ltd - India
- Romanian Commodities Exchange
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Bharathi Cement Corporation - India
- SMC Global Power, Philippines
- Attock Cement Pakistan Limited
- Vizag Seaport Private Limited - India
- Anglo American - United Kingdom
- Eastern Coal Council - USA
- Bukit Baiduri Energy - Indonesia
- Heidelberg Cement - Germany
- Gujarat Mineral Development Corp Ltd - India
- South Luzon Thermal Energy Corporation
- Dalmia Cement Bharat India
- Sakthi Sugars Limited - India
- Petron Corporation, Philippines
- CNBM International Corporation - China
- Central Electricity Authority - India
- Semirara Mining and Power Corporation, Philippines
- Bhatia International Limited - India
- PowerSource Philippines DevCo
- TeaM Sual Corporation - Philippines
- Ministry of Mines - Canada
- GAC Shipping (India) Pvt Ltd
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Port Waratah Coal Services - Australia
- PetroVietnam Power Coal Import and Supply Company
- Kepco SPC Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Metalloyd Limited - United Kingdom
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- Oldendorff Carriers - Singapore
- Iligan Light & Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement PLC, Thailand
- Borneo Indobara - Indonesia
- Ministry of Transport, Egypt
- Star Paper Mills Limited - India
- Kaltim Prima Coal - Indonesia
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Baramulti Group, Indonesia
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kapuas Tunggal Persada - Indonesia
- Directorate Of Revenue Intelligence - India
- Kumho Petrochemical, South Korea
- Rio Tinto Coal - Australia
- Goldman Sachs - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Xindia Steels Limited - India
- Energy Development Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- The University of Queensland
- Electricity Generating Authority of Thailand
- Singapore Mercantile Exchange
- Eastern Energy - Thailand
- Meenaskhi Energy Private Limited - India
- Central Java Power - Indonesia
- Independent Power Producers Association of India
- Gujarat Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Indian Energy Exchange, India
- Sree Jayajothi Cements Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Bulk Trading Sa - Switzerland
- Leighton Contractors Pty Ltd - Australia
- Marubeni Corporation - India
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Power Finance Corporation Ltd., India
- Indian Oil Corporation Limited
- Parliament of New Zealand
- IEA Clean Coal Centre - UK
- Mjunction Services Limited - India
- Sinarmas Energy and Mining - Indonesia
- Barasentosa Lestari - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Price Waterhouse Coopers - Russia
- Manunggal Multi Energi - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- The Treasury - Australian Government
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indika Energy - Indonesia
- Medco Energi Mining Internasional
- Edison Trading Spa - Italy
- Malabar Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Vijayanagar Sugar Pvt Ltd - India
- ASAPP Information Group - India
- Global Business Power Corporation, Philippines
- Planning Commission, India
- Krishnapatnam Port Company Ltd. - India
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Sical Logistics Limited - India
- Minerals Council of Australia
- The State Trading Corporation of India Ltd
- Indonesian Coal Mining Association
- Coastal Gujarat Power Limited - India
- Wilmar Investment Holdings
- Aditya Birla Group - India
- Chettinad Cement Corporation Ltd - India
- Orica Australia Pty. Ltd.
- Timah Investasi Mineral - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Global Green Power PLC Corporation, Philippines
- Carbofer General Trading SA - India
- Toyota Tsusho Corporation, Japan
- Banpu Public Company Limited - Thailand
- Mercator Lines Limited - India
- Riau Bara Harum - Indonesia
- Essar Steel Hazira Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Georgia Ports Authority, United States
- Gujarat Sidhee Cement - India
- Samtan Co., Ltd - South Korea
- Sojitz Corporation - Japan
- Maheswari Brothers Coal Limited - India
- Salva Resources Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Makarim & Taira - Indonesia
- LBH Netherlands Bv - Netherlands
- Economic Council, Georgia
- Savvy Resources Ltd - HongKong
- Billiton Holdings Pty Ltd - Australia
- Bukit Makmur.PT - Indonesia
- VISA Power Limited - India
- Posco Energy - South Korea
- Larsen & Toubro Limited - India
- ICICI Bank Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Globalindo Alam Lestari - Indonesia
- PTC India Limited - India
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Kartika Selabumi Mining - Indonesia
- Mintek Dendrill Indonesia
- Wood Mackenzie - Singapore
- Karaikal Port Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Africa Commodities Group - South Africa
- Sindya Power Generating Company Private Ltd
- White Energy Company Limited
- Asmin Koalindo Tuhup - Indonesia
- Intertek Mineral Services - Indonesia
- New Zealand Coal & Carbon
- Bhushan Steel Limited - India
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Jindal Steel & Power Ltd - India
- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- Standard Chartered Bank - UAE
- Uttam Galva Steels Limited - India
- SMG Consultants - Indonesia
- Altura Mining Limited, Indonesia
- Electricity Authority, New Zealand
- Australian Coal Association
- McConnell Dowell - Australia
- Videocon Industries ltd - India
- Ministry of Finance - Indonesia
- Kobexindo Tractors - Indoneisa
- Vedanta Resources Plc - India
- International Coal Ventures Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- Commonwealth Bank - Australia
- Antam Resourcindo - Indonesia
- Parry Sugars Refinery, India
- Kideco Jaya Agung - Indonesia
- Latin American Coal - Colombia
- Interocean Group of Companies - India
- Holcim Trading Pte Ltd - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- India Bulls Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
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