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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, 01 November 12
SOUTH KOREAN POWER UTILITY EWP TO PURCHASE 670,000 MT OF COAL FOR JAN - FEB 2013 DELIVERY
COALspot.com: Korea East-West Power Co. Ltd. on behalf of Korea South-East Power Co. Ltd., Korea Southern Power Co. Ltd., Korea Midland Power Co. Lt ...
Thursday, 01 November 12
KOMIPO LOOKING FOR 440,000 MT OF 4600 KCAL/KG NAR COAL FOR BORYEONG POWER PLANT
COALspot.com - Korea Midland Power Co. Ltd.(KOMIPO) is inviting bids from coal producers, marketing companies or traders to supply of 440,000 Metric ...
Thursday, 01 November 12
CAPESIZE RATES FALL, DRY BULK MARKET RETREATS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
It was another lackluster session yesterday in the dry bulk markets, with the industry's benchmark, the BDI (Baltic Dry Index) retreating by 1.63 p ...
Thursday, 01 November 12
HANDY : WCI-CHINA RATES ARE AT AROUND USD 5,000 AND ECI-CHINA AROUND USD 4000 - FEARNLEYS AS
Handy
The Atlantic market remains quiet due to a lack of cargoes and an increased supply of ships. Rates from the Continent to east Med were around ...
Tuesday, 30 October 12
COAL PRODUCTION TO RISE BY FIVE PERCENT IN 2013 - TEMPO INTERACTIVE
TEMPO Interactive reported that, Indonesian Coal Mining Association (APBI) chairman Bob Kamandanu has estimated that Indonesian coal production will ...
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- Africa Commodities Group - South Africa
- Indo Tambangraya Megah - Indonesia
- Gujarat Sidhee Cement - India
- Meralco Power Generation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Indonesian Coal Mining Association
- Independent Power Producers Association of India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Grasim Industreis Ltd - India
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Global Business Power Corporation, Philippines
- Edison Trading Spa - Italy
- Petron Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Bangladesh Power Developement Board
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Pendopo Energi Batubara - Indonesia
- Aboitiz Power Corporation - Philippines
- Australian Commodity Traders Exchange
- Holcim Trading Pte Ltd - Singapore
- Ministry of Transport, Egypt
- Lanco Infratech Ltd - India
- Semirara Mining Corp, Philippines
- Borneo Indobara - Indonesia
- VISA Power Limited - India
- Ind-Barath Power Infra Limited - India
- Uttam Galva Steels Limited - India
- San Jose City I Power Corp, Philippines
- PTC India Limited - India
- Parliament of New Zealand
- Parry Sugars Refinery, India
- Singapore Mercantile Exchange
- Karbindo Abesyapradhi - Indoneisa
- Binh Thuan Hamico - Vietnam
- Bhoruka Overseas - Indonesia
- Romanian Commodities Exchange
- Alfred C Toepfer International GmbH - Germany
- Energy Development Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Wood Mackenzie - Singapore
- Sinarmas Energy and Mining - Indonesia
- Renaissance Capital - South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Billiton Holdings Pty Ltd - Australia
- Ambuja Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Electricity Regulatory Commission - India
- The State Trading Corporation of India Ltd
- GAC Shipping (India) Pvt Ltd
- SN Aboitiz Power Inc, Philippines
- Georgia Ports Authority, United States
- CNBM International Corporation - China
- Directorate General of MIneral and Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Meenaskhi Energy Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Anglo American - United Kingdom
- Therma Luzon, Inc, Philippines
- Wilmar Investment Holdings
- Formosa Plastics Group - Taiwan
- International Coal Ventures Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Antam Resourcindo - Indonesia
- Kideco Jaya Agung - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kaltim Prima Coal - Indonesia
- Oldendorff Carriers - Singapore
- Globalindo Alam Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- Energy Link Ltd, New Zealand
- GMR Energy Limited - India
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- TeaM Sual Corporation - Philippines
- Coal and Oil Company - UAE
- Videocon Industries ltd - India
- Kumho Petrochemical, South Korea
- Electricity Generating Authority of Thailand
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Port Waratah Coal Services - Australia
- Indogreen Group - Indonesia
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- Sakthi Sugars Limited - India
- Central Java Power - Indonesia
- Medco Energi Mining Internasional
- Rio Tinto Coal - Australia
- Interocean Group of Companies - India
- Indian Energy Exchange, India
- White Energy Company Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Miang Besar Coal Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- IEA Clean Coal Centre - UK
- The University of Queensland
- Bharathi Cement Corporation - India
- Commonwealth Bank - Australia
- Indika Energy - Indonesia
- Marubeni Corporation - India
- Jaiprakash Power Ventures ltd
- Jindal Steel & Power Ltd - India
- Carbofer General Trading SA - India
- Tata Chemicals Ltd - India
- Sojitz Corporation - Japan
- McConnell Dowell - Australia
- Directorate Of Revenue Intelligence - India
- Tamil Nadu electricity Board
- Vedanta Resources Plc - India
- Sree Jayajothi Cements Limited - India
- Eastern Coal Council - USA
- Siam City Cement PLC, Thailand
- Sindya Power Generating Company Private Ltd
- Ministry of Mines - Canada
- Heidelberg Cement - Germany
- Latin American Coal - Colombia
- Siam City Cement - Thailand
- Vizag Seaport Private Limited - India
- Mjunction Services Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Sarangani Energy Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- The Treasury - Australian Government
- Orica Mining Services - Indonesia
- Posco Energy - South Korea
- Deloitte Consulting - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Economic Council, Georgia
- Trasteel International SA, Italy
- Australian Coal Association
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- Iligan Light & Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- ICICI Bank Limited - India
- Star Paper Mills Limited - India
- Attock Cement Pakistan Limited
- Larsen & Toubro Limited - India
- Simpson Spence & Young - Indonesia
- Aditya Birla Group - India
- Eastern Energy - Thailand
- OPG Power Generation Pvt Ltd - India
- Cement Manufacturers Association - India
- Orica Australia Pty. Ltd.
- Chamber of Mines of South Africa
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Riau Bara Harum - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- South Luzon Thermal Energy Corporation
- Kepco SPC Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Chettinad Cement Corporation Ltd - India
- Bulk Trading Sa - Switzerland
- Agrawal Coal Company - India
- Coalindo Energy - Indonesia
- GVK Power & Infra Limited - India
- Baramulti Group, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Cigading International Bulk Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Ministry of Finance - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Rashtriya Ispat Nigam Limited - India
- Bukit Baiduri Energy - Indonesia
- Sical Logistics Limited - India
- Coastal Gujarat Power Limited - India
- Intertek Mineral Services - Indonesia
- Electricity Authority, New Zealand
- Leighton Contractors Pty Ltd - Australia
- Vijayanagar Sugar Pvt Ltd - India
- MS Steel International - UAE
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- ASAPP Information Group - India
- Bhatia International Limited - India
- Power Finance Corporation Ltd., India
- SMG Consultants - Indonesia
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- London Commodity Brokers - England
- Malabar Cements Ltd - India
- Xindia Steels Limited - India
- Thai Mozambique Logistica
- Minerals Council of Australia
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