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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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Tuesday, 18 December 12
NEWCASTLE PORT IN AUSTRALIA SHIPPED 20.19 PERCENT MORE COAL W/E 17 DECEMBER 2012
COALspot.com - Newcastle port in Australia has loaded 3,269,640 MT of thermal and coking coal for week ended 0700 hours 17 December 2012, Newc ...
Monday, 17 December 12
SHIP PRICES TO BOTTOM OUT IN 2013 SAYS GEORGE D. GOURDOMICHALIS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Ship values especially in older tonnage, or even modern vessels with poor quality are expected to fall further during 2013, with the market as a who ...
Monday, 17 December 12
SYNERGISING WITH PIONEERS TO DEVELOP TOMORROW'S LATIN AMERICAN RAILWAYS
Press Release: Brazil being one of the largest country in South America has one of the most dynamic rail markets in the world. Rail transport in Bra ...
Sunday, 16 December 12
FREIGHT TREND SOFTENED THIS WEEK - VISTAAR
COALspot.com - The freight market further softened this week and closed at 784 points (down by 18.84 pct). The cape index had the biggest fall ...
Friday, 14 December 12
GMR GROUP OF INDIA TO IMPORT 100K MT OF 4800 GAR COAL
COALspot.com: GMR Group of India to invite bids for 100,000 Metric Tons of imported non coking coal to be delivered during January and February 2013 ...
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- Central Java Power - Indonesia
- Global Coal Blending Company Limited - Australia
- Antam Resourcindo - Indonesia
- IHS Mccloskey Coal Group - USA
- Leighton Contractors Pty Ltd - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Chettinad Cement Corporation Ltd - India
- Australian Commodity Traders Exchange
- Kapuas Tunggal Persada - Indonesia
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Malabar Cements Ltd - India
- Kumho Petrochemical, South Korea
- European Bulk Services B.V. - Netherlands
- Wood Mackenzie - Singapore
- Medco Energi Mining Internasional
- Ceylon Electricity Board - Sri Lanka
- Asmin Koalindo Tuhup - Indonesia
- Iligan Light & Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- London Commodity Brokers - England
- PetroVietnam Power Coal Import and Supply Company
- Formosa Plastics Group - Taiwan
- Bukit Baiduri Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Thai Mozambique Logistica
- Indian Energy Exchange, India
- Altura Mining Limited, Indonesia
- Mjunction Services Limited - India
- Bukit Makmur.PT - Indonesia
- Gujarat Sidhee Cement - India
- Grasim Industreis Ltd - India
- Global Business Power Corporation, Philippines
- Posco Energy - South Korea
- Planning Commission, India
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- ICICI Bank Limited - India
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- Vedanta Resources Plc - India
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Carbofer General Trading SA - India
- PTC India Limited - India
- Toyota Tsusho Corporation, Japan
- Australian Coal Association
- Port Waratah Coal Services - Australia
- Wilmar Investment Holdings
- Intertek Mineral Services - Indonesia
- White Energy Company Limited
- Parry Sugars Refinery, India
- Sical Logistics Limited - India
- Singapore Mercantile Exchange
- Semirara Mining and Power Corporation, Philippines
- Minerals Council of Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Videocon Industries ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kohat Cement Company Ltd. - Pakistan
- The Treasury - Australian Government
- Mercuria Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- LBH Netherlands Bv - Netherlands
- Borneo Indobara - Indonesia
- Xindia Steels Limited - India
- Standard Chartered Bank - UAE
- Renaissance Capital - South Africa
- Miang Besar Coal Terminal - Indonesia
- Bhushan Steel Limited - India
- Timah Investasi Mineral - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- Gujarat Electricity Regulatory Commission - India
- Coalindo Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Price Waterhouse Coopers - Russia
- Rio Tinto Coal - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GVK Power & Infra Limited - India
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Kartika Selabumi Mining - Indonesia
- Thiess Contractors Indonesia
- Kepco SPC Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Lanco Infratech Ltd - India
- Merrill Lynch Commodities Europe
- CIMB Investment Bank - Malaysia
- SMG Consultants - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Krishnapatnam Port Company Ltd. - India
- Eastern Energy - Thailand
- Orica Australia Pty. Ltd.
- Goldman Sachs - Singapore
- Star Paper Mills Limited - India
- Petron Corporation, Philippines
- Bhatia International Limited - India
- Meenaskhi Energy Private Limited - India
- Metalloyd Limited - United Kingdom
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Indonesian Coal Mining Association
- Siam City Cement - Thailand
- Bulk Trading Sa - Switzerland
- Vijayanagar Sugar Pvt Ltd - India
- Ministry of Mines - Canada
- Larsen & Toubro Limited - India
- Marubeni Corporation - India
- Tata Chemicals Ltd - India
- Latin American Coal - Colombia
- Ministry of Transport, Egypt
- Aditya Birla Group - India
- Energy Link Ltd, New Zealand
- Trasteel International SA, Italy
- Orica Mining Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Central Electricity Authority - India
- Billiton Holdings Pty Ltd - Australia
- Makarim & Taira - Indonesia
- Indo Tambangraya Megah - Indonesia
- The State Trading Corporation of India Ltd
- CNBM International Corporation - China
- International Coal Ventures Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- Jaiprakash Power Ventures ltd
- Aboitiz Power Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Interocean Group of Companies - India
- Electricity Authority, New Zealand
- Attock Cement Pakistan Limited
- Tamil Nadu electricity Board
- Baramulti Group, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Indika Energy - Indonesia
- Riau Bara Harum - Indonesia
- The University of Queensland
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
- Coal and Oil Company - UAE
- PowerSource Philippines DevCo
- Deloitte Consulting - India
- Parliament of New Zealand
- Independent Power Producers Association of India
- Agrawal Coal Company - India
- South Luzon Thermal Energy Corporation
- Jindal Steel & Power Ltd - India
- Banpu Public Company Limited - Thailand
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- Sojitz Corporation - Japan
- Meralco Power Generation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- Karaikal Port Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Maharashtra Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Essar Steel Hazira Ltd - India
- Vizag Seaport Private Limited - India
- Economic Council, Georgia
- Mintek Dendrill Indonesia
- Bangladesh Power Developement Board
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- Edison Trading Spa - Italy
- Anglo American - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Therma Luzon, Inc, Philippines
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- ASAPP Information Group - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate General of MIneral and Coal - Indonesia
- Eastern Coal Council - USA
- Simpson Spence & Young - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- GMR Energy Limited - India
- Africa Commodities Group - South Africa
- TeaM Sual Corporation - Philippines
- Uttam Galva Steels Limited - India
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Cement Manufacturers Association - India
- McConnell Dowell - Australia
- Manunggal Multi Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Coastal Gujarat Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Semirara Mining Corp, Philippines
- VISA Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- MS Steel International - UAE
- Electricity Generating Authority of Thailand
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Ambuja Cements Ltd - India
- Directorate Of Revenue Intelligence - India
- Energy Development Corp, Philippines
- San Jose City I Power Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Siam City Cement PLC, Thailand
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