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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, 10 January 13
DRY BULK PANAMAX MARKET HEAVILY OVERSUPPLIED, UNLIKELY TO FIND SUPPORT IN 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite positive indication for a significant surge of dry bulk demand this year, the oversupply problems of the market, will continue to weigh heav ...
Tuesday, 08 January 13
HOLIDAY ACTIVITY SCARCE IN THE MARKET OF SECOND HAND VESSELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Although the market for second hand vessel purchasing was quite lull during the Holiday period, as is usually the case, the first days of the New Ye ...
Tuesday, 08 January 13
NEWCASTLE PORT SHIPPED 3.197 MILLION MT OF COAL W/E 7 JANUARY 2013
COALspot.com - Newcastle port in Australia has loaded 3,197,580 MT of thermal and coking coal for week ended 0700 hours 7 January 2013, Newcas ...
Sunday, 06 January 13
CFR SOUTH CHINA COAL: 2014 DELIVERY CLOSED US$ 6.80 HIGHER THAN Q1 '13 PRICE
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q1’ 2013 delivery has gained 0.37 percent WoW and CFR South China coal sh ...
Sunday, 06 January 13
COAL BOOM: WAKE-UP CALL FOR INDIA & INDONESIA! - SUNIL K KUMBHAT
COALspot.com - Coal Boom : Scenario, Now & later!
Coal has been the dominant fuel for power generating plants in developed countries since th ...
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- Simpson Spence & Young - Indonesia
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- Aboitiz Power Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Rashtriya Ispat Nigam Limited - India
- Gujarat Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Toyota Tsusho Corporation, Japan
- Edison Trading Spa - Italy
- Merrill Lynch Commodities Europe
- SMG Consultants - Indonesia
- Bhoruka Overseas - Indonesia
- Trasteel International SA, Italy
- ASAPP Information Group - India
- Cement Manufacturers Association - India
- Deloitte Consulting - India
- OPG Power Generation Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Interocean Group of Companies - India
- Carbofer General Trading SA - India
- Petron Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Binh Thuan Hamico - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Iligan Light & Power Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Thiess Contractors Indonesia
- Parliament of New Zealand
- White Energy Company Limited
- LBH Netherlands Bv - Netherlands
- Manunggal Multi Energi - Indonesia
- Anglo American - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Price Waterhouse Coopers - Russia
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Leighton Contractors Pty Ltd - Australia
- Oldendorff Carriers - Singapore
- Directorate Of Revenue Intelligence - India
- Indian Oil Corporation Limited
- Globalindo Alam Lestari - Indonesia
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Makarim & Taira - Indonesia
- Straits Asia Resources Limited - Singapore
- India Bulls Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Bangladesh Power Developement Board
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Pendopo Energi Batubara - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Power Finance Corporation Ltd., India
- Barasentosa Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Central Electricity Authority - India
- Independent Power Producers Association of India
- Attock Cement Pakistan Limited
- Karbindo Abesyapradhi - Indoneisa
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
- Jaiprakash Power Ventures ltd
- The State Trading Corporation of India Ltd
- Samtan Co., Ltd - South Korea
- Coastal Gujarat Power Limited - India
- Kaltim Prima Coal - Indonesia
- Altura Mining Limited, Indonesia
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Eastern Coal Council - USA
- SMC Global Power, Philippines
- Thai Mozambique Logistica
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- The Treasury - Australian Government
- Sindya Power Generating Company Private Ltd
- Singapore Mercantile Exchange
- Kartika Selabumi Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- Australian Commodity Traders Exchange
- Grasim Industreis Ltd - India
- Vedanta Resources Plc - India
- Romanian Commodities Exchange
- Bhatia International Limited - India
- Global Business Power Corporation, Philippines
- Minerals Council of Australia
- Mjunction Services Limited - India
- Tamil Nadu electricity Board
- Miang Besar Coal Terminal - Indonesia
- Heidelberg Cement - Germany
- Port Waratah Coal Services - Australia
- Rio Tinto Coal - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- Antam Resourcindo - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- PetroVietnam Power Coal Import and Supply Company
- PTC India Limited - India
- Metalloyd Limited - United Kingdom
- Central Java Power - Indonesia
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- Essar Steel Hazira Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kapuas Tunggal Persada - Indonesia
- Chamber of Mines of South Africa
- Larsen & Toubro Limited - India
- Bukit Baiduri Energy - Indonesia
- Semirara Mining Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- Riau Bara Harum - Indonesia
- Commonwealth Bank - Australia
- Star Paper Mills Limited - India
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- IEA Clean Coal Centre - UK
- South Luzon Thermal Energy Corporation
- Sarangani Energy Corporation, Philippines
- Indian Energy Exchange, India
- GN Power Mariveles Coal Plant, Philippines
- London Commodity Brokers - England
- Kumho Petrochemical, South Korea
- Maheswari Brothers Coal Limited - India
- Global Coal Blending Company Limited - Australia
- Bukit Makmur.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- Economic Council, Georgia
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indika Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- Electricity Generating Authority of Thailand
- Orica Australia Pty. Ltd.
- Indogreen Group - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- Meralco Power Generation, Philippines
- Planning Commission, India
- Georgia Ports Authority, United States
- Banpu Public Company Limited - Thailand
- Ministry of Mines - Canada
- PNOC Exploration Corporation - Philippines
- Posco Energy - South Korea
- Timah Investasi Mineral - Indoneisa
- Tata Chemicals Ltd - India
- Karaikal Port Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- MS Steel International - UAE
- Aditya Birla Group - India
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Australian Coal Association
- Medco Energi Mining Internasional
- Ministry of Transport, Egypt
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Dalmia Cement Bharat India
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- Krishnapatnam Port Company Ltd. - India
- CNBM International Corporation - China
- Wilmar Investment Holdings
- GAC Shipping (India) Pvt Ltd
- Formosa Plastics Group - Taiwan
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Baramulti Group, Indonesia
- Sical Logistics Limited - India
- Mintek Dendrill Indonesia
- Lanco Infratech Ltd - India
- Kepco SPC Power Corporation, Philippines
- Orica Mining Services - Indonesia
- Agrawal Coal Company - India
- Therma Luzon, Inc, Philippines
- Ambuja Cements Ltd - India
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