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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, 13 December 12
HANDY : WCI-CHINA RATES AROUND $ 6000 AND ECI-CHINA AROUND $ 4000 - FEARNLEYS
Handy
Atlantic market remained unchanged. Rates from USG to Feast were around USD 18k and Black Sea to Feast about USD 10k. USG-Skaw-Passero rates ...
Wednesday, 12 December 12
69.23 PERCENT OF END-USERS ARE BELIEVE, COAL PRICES ARE IN UPWARD TREND
COALspot.com - The Indonesian government’s declared coal reference price for December’ 12 has gained US cents 31 per MT M-o- ...
Wednesday, 12 December 12
CAPESIZE FREIGHT RATES TO RANGE BETWEEN $9,000 - 16,000/DAY IN THE COMING WEEKS SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
In its regular update on the dry bulk market, BIMCO forecasted yesterday, that Capesize time-charter rates are expected to stay elevated in the foll ...
Tuesday, 11 December 12
NEWCASTLE PORT IN AUSTRALIA HAS LOADED 2,720,205 MT OF COAL W/E 10 DECEMBER 2012
COALspot.com - Newcastle port in Australia has loaded 2,720,205 MT of thermal and coking coal for week ended 0700 hours 10 December 2012, Newc ...
Sunday, 09 December 12
COAL SWAPS HAVE LOST DIRECTION DUE TO LACK OF ASIAN INTEREST
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q1’ 2013 delivery gained 2.43 percent M-M but lost WoW by 0.54 percent and 0.62 ...
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- India Bulls Power Limited - India
- Baramulti Group, Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Sree Jayajothi Cements Limited - India
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Salva Resources Pvt Ltd - India
- Borneo Indobara - Indonesia
- Renaissance Capital - South Africa
- Sojitz Corporation - Japan
- VISA Power Limited - India
- Gujarat Sidhee Cement - India
- Port Waratah Coal Services - Australia
- Central Electricity Authority - India
- Globalindo Alam Lestari - Indonesia
- Jindal Steel & Power Ltd - India
- Siam City Cement - Thailand
- Electricity Generating Authority of Thailand
- The State Trading Corporation of India Ltd
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- Economic Council, Georgia
- Holcim Trading Pte Ltd - Singapore
- Billiton Holdings Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Heidelberg Cement - Germany
- GMR Energy Limited - India
- Carbofer General Trading SA - India
- Videocon Industries ltd - India
- Iligan Light & Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Sarangani Energy Corporation, Philippines
- Marubeni Corporation - India
- Coastal Gujarat Power Limited - India
- Standard Chartered Bank - UAE
- Medco Energi Mining Internasional
- Bharathi Cement Corporation - India
- Tata Chemicals Ltd - India
- Xindia Steels Limited - India
- IEA Clean Coal Centre - UK
- Ceylon Electricity Board - Sri Lanka
- Trasteel International SA, Italy
- Africa Commodities Group - South Africa
- PTC India Limited - India
- Sical Logistics Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kobexindo Tractors - Indoneisa
- Karaikal Port Pvt Ltd - India
- Orica Mining Services - Indonesia
- Barasentosa Lestari - Indonesia
- Malabar Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- Aditya Birla Group - India
- Central Java Power - Indonesia
- Maheswari Brothers Coal Limited - India
- Agrawal Coal Company - India
- Bangladesh Power Developement Board
- OPG Power Generation Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Power Finance Corporation Ltd., India
- LBH Netherlands Bv - Netherlands
- Eastern Energy - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Baiduri Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- GAC Shipping (India) Pvt Ltd
- Mercuria Energy - Indonesia
- Indian Oil Corporation Limited
- Metalloyd Limited - United Kingdom
- GVK Power & Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Deloitte Consulting - India
- Ind-Barath Power Infra Limited - India
- Rio Tinto Coal - Australia
- Bahari Cakrawala Sebuku - Indonesia
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- Petron Corporation, Philippines
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sakthi Sugars Limited - India
- Anglo American - United Kingdom
- Wood Mackenzie - Singapore
- Cement Manufacturers Association - India
- TNB Fuel Sdn Bhd - Malaysia
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Kalimantan Lumbung Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- Directorate Of Revenue Intelligence - India
- Jorong Barutama Greston.PT - Indonesia
- Intertek Mineral Services - Indonesia
- Bhoruka Overseas - Indonesia
- Banpu Public Company Limited - Thailand
- Meralco Power Generation, Philippines
- Antam Resourcindo - Indonesia
- Wilmar Investment Holdings
- Krishnapatnam Port Company Ltd. - India
- Sindya Power Generating Company Private Ltd
- Therma Luzon, Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Kapuas Tunggal Persada - Indonesia
- ASAPP Information Group - India
- Orica Australia Pty. Ltd.
- Madhucon Powers Ltd - India
- Bhushan Steel Limited - India
- Gujarat Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Asmin Koalindo Tuhup - Indonesia
- The University of Queensland
- Minerals Council of Australia
- Riau Bara Harum - Indonesia
- Planning Commission, India
- Merrill Lynch Commodities Europe
- Timah Investasi Mineral - Indoneisa
- Coal and Oil Company - UAE
- Vedanta Resources Plc - India
- Romanian Commodities Exchange
- Latin American Coal - Colombia
- TeaM Sual Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- SN Aboitiz Power Inc, Philippines
- Larsen & Toubro Limited - India
- Coalindo Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Karbindo Abesyapradhi - Indoneisa
- Bulk Trading Sa - Switzerland
- CNBM International Corporation - China
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Star Paper Mills Limited - India
- Straits Asia Resources Limited - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Indika Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Tamil Nadu electricity Board
- New Zealand Coal & Carbon
- MS Steel International - UAE
- Parry Sugars Refinery, India
- Kepco SPC Power Corporation, Philippines
- SMC Global Power, Philippines
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- Jaiprakash Power Ventures ltd
- Maharashtra Electricity Regulatory Commission - India
- Attock Cement Pakistan Limited
- Simpson Spence & Young - Indonesia
- Kumho Petrochemical, South Korea
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- Kaltim Prima Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Global Business Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Ambuja Cements Ltd - India
- Bayan Resources Tbk. - Indonesia
- Thiess Contractors Indonesia
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Global Green Power PLC Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Formosa Plastics Group - Taiwan
- Interocean Group of Companies - India
- Parliament of New Zealand
- Thai Mozambique Logistica
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- The Treasury - Australian Government
- South Luzon Thermal Energy Corporation
- London Commodity Brokers - England
- Binh Thuan Hamico - Vietnam
- Eastern Coal Council - USA
- Commonwealth Bank - Australia
- Goldman Sachs - Singapore
- Samtan Co., Ltd - South Korea
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- Ministry of Finance - Indonesia
- Indo Tambangraya Megah - Indonesia
- Georgia Ports Authority, United States
- Mjunction Services Limited - India
- Indonesian Coal Mining Association
- Vizag Seaport Private Limited - India
- Grasim Industreis Ltd - India
- PNOC Exploration Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- Singapore Mercantile Exchange
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Australian Coal Association
- Ministry of Mines - Canada
- Energy Link Ltd, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Oldendorff Carriers - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indian Energy Exchange, India
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- Sinarmas Energy and Mining - Indonesia
- ICICI Bank Limited - India
- CIMB Investment Bank - Malaysia
- GN Power Mariveles Coal Plant, Philippines
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