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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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Monday, 12 November 12
THE ESTABLISHMENT OF NORTH KALIMANTAN AS A NEW PROVINCE WILL NOT AFFECT THE LOCAL MINING COMPANIES
The government of Indonesia has ensured that the establishment of North Kalimantan as a new province will not affect the local mining companies ...
Monday, 12 November 12
DRILLING COMPLETED AT THE MOORLANDS DEPOSIT, WEST BOWEN PROJECT
Press Release - Cuesta Coal Limited (ASX: CQC) (“Cuesta”) is pleased to announce it has completed its exploration activities at the Moor ...
Monday, 12 November 12
BARGE-LOAD OF 5K TONNES OF COAL FROM THE ADK JOINT VENTURE SHIPPED LAST WEEK
COALspot.com - Orpheus Energy (ASX:OEG) has announced that, it has successfully shipped a 5,000 tonne of ADK thermal coal to an Indonesian trading g ...
Sunday, 11 November 12
AN OPTIMISTIC WEEK FOR INDONESIAN SUB-BIT COAL
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for January 2013 delivery gains 2.08 percent WoW and 1.28 percent DoD on Friday, 9 November ...
Sunday, 11 November 12
THE IRON ORE AND COAL PRICES MOVEMENTS REMAINS LOW - VISTAAR
COALspot.com The market remained soft with all the sectors soft.
The BDI and was down by 4.67 pct closing at 940 points, on Friday 9 Novemb ...
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- Pendopo Energi Batubara - Indonesia
- Directorate Of Revenue Intelligence - India
- Planning Commission, India
- Carbofer General Trading SA - India
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Riau Bara Harum - Indonesia
- Orica Mining Services - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- New Zealand Coal & Carbon
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Pipit Mutiara Jaya. PT, Indonesia
- Coal and Oil Company - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- Ministry of Mines - Canada
- Kapuas Tunggal Persada - Indonesia
- GAC Shipping (India) Pvt Ltd
- Kohat Cement Company Ltd. - Pakistan
- Essar Steel Hazira Ltd - India
- Price Waterhouse Coopers - Russia
- Deloitte Consulting - India
- Maheswari Brothers Coal Limited - India
- Tata Chemicals Ltd - India
- Sindya Power Generating Company Private Ltd
- OPG Power Generation Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Indonesian Coal Mining Association
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- Economic Council, Georgia
- Star Paper Mills Limited - India
- Baramulti Group, Indonesia
- Port Waratah Coal Services - Australia
- Eastern Coal Council - USA
- Mjunction Services Limited - India
- Petron Corporation, Philippines
- Indian Oil Corporation Limited
- Eastern Energy - Thailand
- Bharathi Cement Corporation - India
- Intertek Mineral Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- ICICI Bank Limited - India
- Siam City Cement - Thailand
- LBH Netherlands Bv - Netherlands
- Georgia Ports Authority, United States
- Iligan Light & Power Inc, Philippines
- Gujarat Sidhee Cement - India
- GMR Energy Limited - India
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Energy Development Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- Meenaskhi Energy Private Limited - India
- International Coal Ventures Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Ceylon Electricity Board - Sri Lanka
- India Bulls Power Limited - India
- Bulk Trading Sa - Switzerland
- SN Aboitiz Power Inc, Philippines
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- Meralco Power Generation, Philippines
- Ind-Barath Power Infra Limited - India
- Globalindo Alam Lestari - Indonesia
- Electricity Generating Authority of Thailand
- Romanian Commodities Exchange
- Agrawal Coal Company - India
- Indian Energy Exchange, India
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Sakthi Sugars Limited - India
- Videocon Industries ltd - India
- Samtan Co., Ltd - South Korea
- Electricity Authority, New Zealand
- Kartika Selabumi Mining - Indonesia
- Posco Energy - South Korea
- Siam City Cement PLC, Thailand
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Mercator Lines Limited - India
- Wood Mackenzie - Singapore
- Bhatia International Limited - India
- Malabar Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Billiton Holdings Pty Ltd - Australia
- Aditya Birla Group - India
- The State Trading Corporation of India Ltd
- Antam Resourcindo - Indonesia
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- IHS Mccloskey Coal Group - USA
- SMG Consultants - Indonesia
- Minerals Council of Australia
- Australian Commodity Traders Exchange
- Aboitiz Power Corporation - Philippines
- SMC Global Power, Philippines
- Thai Mozambique Logistica
- McConnell Dowell - Australia
- Goldman Sachs - Singapore
- Interocean Group of Companies - India
- San Jose City I Power Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PowerSource Philippines DevCo
- Central Java Power - Indonesia
- Wilmar Investment Holdings
- Orica Australia Pty. Ltd.
- Rio Tinto Coal - Australia
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- Semirara Mining Corp, Philippines
- Bhoruka Overseas - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Vizag Seaport Private Limited - India
- Simpson Spence & Young - Indonesia
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Global Coal Blending Company Limited - Australia
- Kaltim Prima Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The Treasury - Australian Government
- White Energy Company Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- Sojitz Corporation - Japan
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- Vedanta Resources Plc - India
- Heidelberg Cement - Germany
- Miang Besar Coal Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Central Electricity Authority - India
- Jaiprakash Power Ventures ltd
- Indika Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Trasteel International SA, Italy
- Jorong Barutama Greston.PT - Indonesia
- Australian Coal Association
- London Commodity Brokers - England
- Gujarat Electricity Regulatory Commission - India
- Coalindo Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Mintek Dendrill Indonesia
- Medco Energi Mining Internasional
- Formosa Plastics Group - Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Chamber of Mines of South Africa
- Barasentosa Lestari - Indonesia
- CNBM International Corporation - China
- TeaM Sual Corporation - Philippines
- Ministry of Transport, Egypt
- Bukit Makmur.PT - Indonesia
- Xindia Steels Limited - India
- Anglo American - United Kingdom
- Coastal Gujarat Power Limited - India
- Madhucon Powers Ltd - India
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
- Commonwealth Bank - Australia
- Neyveli Lignite Corporation Ltd, - India
- The University of Queensland
- ASAPP Information Group - India
- IEA Clean Coal Centre - UK
- Sree Jayajothi Cements Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- Sical Logistics Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Chettinad Cement Corporation Ltd - India
- GVK Power & Infra Limited - India
- Ministry of Finance - Indonesia
- Grasim Industreis Ltd - India
- MS Steel International - UAE
- Banpu Public Company Limited - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Latin American Coal - Colombia
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- VISA Power Limited - India
- Tamil Nadu electricity Board
- Singapore Mercantile Exchange
- Borneo Indobara - Indonesia
- Krishnapatnam Port Company Ltd. - India
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