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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, 08 March 13
DRY BULK MARKET ON A RISING TREND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has continued its rising pattern set after China opened up again for business, following the Asian New Year Holidays. As a resul ...
Thursday, 07 March 13
PANAMAX : POSITIVE TREND; CAPESIZE : GRADUALLY SLIDE - FEARNLEYS AS
Handy
The Atlantic saw more cargoes than last week and rates ticking upwards. The USG-Feast was at USD 22k and Black sea-feast was at USD 12k. The ...
Tuesday, 05 March 13
NEWCASTLE PORT SHIPPED 20.77 PERCENT MORE COAL W/E 4 MARCH 2013
COALspot.com - Newcastle port in Australia has loaded 2,631,562 MT of thermal and coking coal for a week ended 0700 hours 4 March 2013, Newcas ...
Sunday, 03 March 13
INDONESIAN THERMAL COAL SWAPS; CHINA CONTRACTS FALL W-O-W
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q2’ 2013 delivery has lost 0.75 percent and CFR South China coal shipment&nbs ...
Sunday, 03 March 13
FREIGHT MARKET FROM INDONESIA EXPECTED TO BE FIRM - VISTAAR
COALspot.com – The freight market has been fairly firm this week except for cape size index.
The BDI was up by 4.64 points closing at 776 p ...
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- SN Aboitiz Power Inc, Philippines
- Coalindo Energy - Indonesia
- Power Finance Corporation Ltd., India
- OPG Power Generation Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Trasteel International SA, Italy
- PTC India Limited - India
- Singapore Mercantile Exchange
- Semirara Mining and Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- ICICI Bank Limited - India
- Interocean Group of Companies - India
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Rio Tinto Coal - Australia
- Malabar Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Australian Coal Association
- South Luzon Thermal Energy Corporation
- Maharashtra Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Toyota Tsusho Corporation, Japan
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Posco Energy - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- London Commodity Brokers - England
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Banpu Public Company Limited - Thailand
- Bulk Trading Sa - Switzerland
- TNB Fuel Sdn Bhd - Malaysia
- Indonesian Coal Mining Association
- Parliament of New Zealand
- Antam Resourcindo - Indonesia
- Eastern Energy - Thailand
- Mercator Lines Limited - India
- Marubeni Corporation - India
- VISA Power Limited - India
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- IEA Clean Coal Centre - UK
- Bhoruka Overseas - Indonesia
- LBH Netherlands Bv - Netherlands
- PNOC Exploration Corporation - Philippines
- Baramulti Group, Indonesia
- Chettinad Cement Corporation Ltd - India
- The University of Queensland
- ASAPP Information Group - India
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- Kumho Petrochemical, South Korea
- Makarim & Taira - Indonesia
- CNBM International Corporation - China
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- India Bulls Power Limited - India
- Chamber of Mines of South Africa
- PowerSource Philippines DevCo
- Sindya Power Generating Company Private Ltd
- Bukit Baiduri Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Directorate Of Revenue Intelligence - India
- Deloitte Consulting - India
- Essar Steel Hazira Ltd - India
- Romanian Commodities Exchange
- Metalloyd Limited - United Kingdom
- GAC Shipping (India) Pvt Ltd
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Madhucon Powers Ltd - India
- Orica Australia Pty. Ltd.
- Maheswari Brothers Coal Limited - India
- Holcim Trading Pte Ltd - Singapore
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Minerals Council of Australia
- Indian Oil Corporation Limited
- Planning Commission, India
- Merrill Lynch Commodities Europe
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- Jorong Barutama Greston.PT - Indonesia
- SMG Consultants - Indonesia
- GVK Power & Infra Limited - India
- Wood Mackenzie - Singapore
- AsiaOL BioFuels Corp., Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Commonwealth Bank - Australia
- Coastal Gujarat Power Limited - India
- Bhushan Steel Limited - India
- Kapuas Tunggal Persada - Indonesia
- Bangladesh Power Developement Board
- Bukit Asam (Persero) Tbk - Indonesia
- Tamil Nadu electricity Board
- Petron Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Thai Mozambique Logistica
- McConnell Dowell - Australia
- Dalmia Cement Bharat India
- Simpson Spence & Young - Indonesia
- Sree Jayajothi Cements Limited - India
- Port Waratah Coal Services - Australia
- Bhatia International Limited - India
- Ministry of Finance - Indonesia
- Parry Sugars Refinery, India
- Straits Asia Resources Limited - Singapore
- Attock Cement Pakistan Limited
- Savvy Resources Ltd - HongKong
- Ambuja Cements Ltd - India
- Wilmar Investment Holdings
- Kideco Jaya Agung - Indonesia
- Iligan Light & Power Inc, Philippines
- New Zealand Coal & Carbon
- Cigading International Bulk Terminal - Indonesia
- Vizag Seaport Private Limited - India
- Xindia Steels Limited - India
- Mercuria Energy - Indonesia
- Cement Manufacturers Association - India
- Gujarat Mineral Development Corp Ltd - India
- Altura Mining Limited, Indonesia
- Electricity Authority, New Zealand
- Independent Power Producers Association of India
- Indika Energy - Indonesia
- Gujarat Sidhee Cement - India
- Ind-Barath Power Infra Limited - India
- Sojitz Corporation - Japan
- Bahari Cakrawala Sebuku - Indonesia
- European Bulk Services B.V. - Netherlands
- The State Trading Corporation of India Ltd
- Eastern Coal Council - USA
- White Energy Company Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Australian Commodity Traders Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Green Power PLC Corporation, Philippines
- Siam City Cement - Thailand
- Krishnapatnam Port Company Ltd. - India
- Kohat Cement Company Ltd. - Pakistan
- Heidelberg Cement - Germany
- Africa Commodities Group - South Africa
- Jaiprakash Power Ventures ltd
- Mintek Dendrill Indonesia
- Sical Logistics Limited - India
- Agrawal Coal Company - India
- Salva Resources Pvt Ltd - India
- Indian Energy Exchange, India
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- Medco Energi Mining Internasional
- Kaltim Prima Coal - Indonesia
- Lanco Infratech Ltd - India
- Barasentosa Lestari - Indonesia
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Kartika Selabumi Mining - Indonesia
- Coal and Oil Company - UAE
- SMC Global Power, Philippines
- Goldman Sachs - Singapore
- Central Java Power - Indonesia
- Grasim Industreis Ltd - India
- Jindal Steel & Power Ltd - India
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Timah Investasi Mineral - Indoneisa
- Bharathi Cement Corporation - India
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Siam City Cement PLC, Thailand
- Latin American Coal - Colombia
- Indogreen Group - Indonesia
- Georgia Ports Authority, United States
- Ceylon Electricity Board - Sri Lanka
- Globalindo Alam Lestari - Indonesia
- MS Steel International - UAE
- The Treasury - Australian Government
- Binh Thuan Hamico - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- Larsen & Toubro Limited - India
- Edison Trading Spa - Italy
- Anglo American - United Kingdom
- Sakthi Sugars Limited - India
- Price Waterhouse Coopers - Russia
- Samtan Co., Ltd - South Korea
- Indo Tambangraya Megah - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Orica Mining Services - Indonesia
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- Oldendorff Carriers - Singapore
- Energy Development Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Central Electricity Authority - India
- Bukit Makmur.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Star Paper Mills Limited - India
- Kepco SPC Power Corporation, Philippines
- Vedanta Resources Plc - India
- International Coal Ventures Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- GMR Energy Limited - India
- Karbindo Abesyapradhi - Indoneisa
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