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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, 04 December 12
JATENERGY SIGNS MOU FOR INDONESIAN COAL ASSET
COALspot.com - Jatenergy Limited has announced that its fully-owned Indonesian subsidiary, PT Barata Energy (BE), has signed an exclusive, non-bindi ...
Tuesday, 04 December 12
NEWCASTLE PORT SHIPPED 55.88 PERCENT MORE COAL W/E 3 DECEMBER 2012
COALspot.com - Newcastle port in Australia has loaded 2,796,341 MT of thermal and coking coal for week ended 0700 hours 3 December 2012, Newca ...
Sunday, 02 December 12
YEAR 2013, YEAR OF SUPPLY OR DEMAND?
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for average Q1 2013 delivery gained 2.87 & 0.83 percent MoM and WoW respectively ...
Saturday, 01 December 12
TIGHT SUPPLY, DEMAND PUSH INDO-INDIA SUPRAMAX FREIGHT RATES HIGHER - VISTAAR
COALspot.com - The freight market was mixed this week as cape and Panamax indices are closing softer.
The BDI was down 0.37 pct closing at 1,086 ...
Friday, 30 November 12
FUTURE TREND OF SECOND HAND SHIP VALUES PUZZLING SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
One of the major challenges that ship owners are facing today is whether or not to invest in a second hand vessel at any given time. For instance, i ...
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- Kumho Petrochemical, South Korea
- Renaissance Capital - South Africa
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- Cement Manufacturers Association - India
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- Heidelberg Cement - Germany
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- White Energy Company Limited
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- GN Power Mariveles Coal Plant, Philippines
- Energy Link Ltd, New Zealand
- Bhatia International Limited - India
- Vizag Seaport Private Limited - India
- The University of Queensland
- Jorong Barutama Greston.PT - Indonesia
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- Posco Energy - South Korea
- Lanco Infratech Ltd - India
- Parliament of New Zealand
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- Offshore Bulk Terminal Pte Ltd, Singapore
- Sojitz Corporation - Japan
- Minerals Council of Australia
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- Central Electricity Authority - India
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- Siam City Cement - Thailand
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- Bukit Makmur.PT - Indonesia
- Metalloyd Limited - United Kingdom
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bangladesh Power Developement Board
- Mintek Dendrill Indonesia
- Trasteel International SA, Italy
- Indian Energy Exchange, India
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- Toyota Tsusho Corporation, Japan
- Energy Development Corp, Philippines
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- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
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- Altura Mining Limited, Indonesia
- Iligan Light & Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Ministry of Finance - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Latin American Coal - Colombia
- Meenaskhi Energy Private Limited - India
- IHS Mccloskey Coal Group - USA
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Interocean Group of Companies - India
- Maheswari Brothers Coal Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Singapore Mercantile Exchange
- CIMB Investment Bank - Malaysia
- Straits Asia Resources Limited - Singapore
- GVK Power & Infra Limited - India
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- Manunggal Multi Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- GAC Shipping (India) Pvt Ltd
- Edison Trading Spa - Italy
- PNOC Exploration Corporation - Philippines
- Merrill Lynch Commodities Europe
- Binh Thuan Hamico - Vietnam
- Gujarat Sidhee Cement - India
- Goldman Sachs - Singapore
- Wilmar Investment Holdings
- Simpson Spence & Young - Indonesia
- Indian Oil Corporation Limited
- Carbofer General Trading SA - India
- Sarangani Energy Corporation, Philippines
- Star Paper Mills Limited - India
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- Karbindo Abesyapradhi - Indoneisa
- Australian Coal Association
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- CNBM International Corporation - China
- IEA Clean Coal Centre - UK
- The Treasury - Australian Government
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- Bulk Trading Sa - Switzerland
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- Ministry of Transport, Egypt
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Kalimantan Lumbung Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
- VISA Power Limited - India
- San Jose City I Power Corp, Philippines
- Australian Commodity Traders Exchange
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- PetroVietnam Power Coal Import and Supply Company
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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- Standard Chartered Bank - UAE
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- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
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- Economic Council, Georgia
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- GMR Energy Limited - India
- Timah Investasi Mineral - Indoneisa
- Thai Mozambique Logistica
- Semirara Mining and Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Neyveli Lignite Corporation Ltd, - India
- Samtan Co., Ltd - South Korea
- Central Java Power - Indonesia
- ASAPP Information Group - India
- Ceylon Electricity Board - Sri Lanka
- Aditya Birla Group - India
- SN Aboitiz Power Inc, Philippines
- Planning Commission, India
- Sinarmas Energy and Mining - Indonesia
- Antam Resourcindo - Indonesia
- Semirara Mining Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- Mercator Lines Limited - India
- Grasim Industreis Ltd - India
- Indonesian Coal Mining Association
- Bhushan Steel Limited - India
- SMG Consultants - Indonesia
- Kepco SPC Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Tamil Nadu electricity Board
- Deloitte Consulting - India
- Salva Resources Pvt Ltd - India
- Wood Mackenzie - Singapore
- Georgia Ports Authority, United States
- PTC India Limited - India
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- PowerSource Philippines DevCo
- Eastern Energy - Thailand
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Eastern Coal Council - USA
- Uttam Galva Steels Limited - India
- Madhucon Powers Ltd - India
- Cigading International Bulk Terminal - Indonesia
- India Bulls Power Limited - India
- ICICI Bank Limited - India
- Borneo Indobara - Indonesia
- Sical Logistics Limited - India
- Leighton Contractors Pty Ltd - Australia
- Coal and Oil Company - UAE
- Global Green Power PLC Corporation, Philippines
- TeaM Sual Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- South Luzon Thermal Energy Corporation
- Chettinad Cement Corporation Ltd - India
- Port Waratah Coal Services - Australia
- Sakthi Sugars Limited - India
- Kaltim Prima Coal - Indonesia
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- Petrochimia International Co. Ltd.- Taiwan
- Videocon Industries ltd - India
- Coastal Gujarat Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Intertek Mineral Services - Indonesia
- The State Trading Corporation of India Ltd
- Commonwealth Bank - Australia
- Chamber of Mines of South Africa
- Africa Commodities Group - South Africa
- Directorate Of Revenue Intelligence - India
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- Bharathi Cement Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Mines - Canada
- MS Steel International - UAE
- Independent Power Producers Association of India
- Rashtriya Ispat Nigam Limited - India
- Petron Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Coalindo Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- SMC Global Power, Philippines
- AsiaOL BioFuels Corp., Philippines
- Electricity Authority, New Zealand
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