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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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Friday, 03 August 12
INDIA - LIGHTS OUT! - SALVA
The Indian power sector hit global headlines this week for all the wrong reasons. Firstly, on Monday, over 350 million people lost power across nort ...
Thursday, 02 August 12
OIL & GAS COMPANIES TO MEET IN MYANMAR FOR UPDATES ON NEW ROUND OF BIDDING AND INVESTMENT POTENTIAL IN UPSTREAM OIL, GAS, AND POWER GENERATION
Press Release - 2nd MOGP Summit (Myanmar Oil, Gas & Power) will convene in Yangon from 3 – 6 September 2012, to unveil new round of biddin ...
Thursday, 02 August 12
DRY BULK MARKET RATES CONTINUE SLUMP AMID SLOWER DEMAND NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market kept on its downward path Wednesday, as the BDI (Baltic Dry Index) kept retreating to new lows. The index was down by 2.12 perce ...
Monday, 30 July 12
DRY BULK MARKET TO REMAIN UNDER PRESSURE FOR THE REST OF 2012 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In an interview with Hellenic Shipping News Worldwide, Mr. Yannis Pachoulis, President of the Hellenic Shipbrokers' Association, remains cautiously ...
Sunday, 29 July 12
FREIGHT MARKET MOMENTUM CONTINUES TO WEAK
COALspot.com - The freight market continued to soft this week with all the segments dropped and the BDI fell below 1,000 points and closed at 933 po ...
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- Ambuja Cements Ltd - India
- Energy Link Ltd, New Zealand
- European Bulk Services B.V. - Netherlands
- Xindia Steels Limited - India
- Heidelberg Cement - Germany
- Marubeni Corporation - India
- Thiess Contractors Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- Cigading International Bulk Terminal - Indonesia
- Thai Mozambique Logistica
- Interocean Group of Companies - India
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Mercator Lines Limited - India
- Electricity Generating Authority of Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jaiprakash Power Ventures ltd
- Rashtriya Ispat Nigam Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Australian Commodity Traders Exchange
- Bhatia International Limited - India
- Coastal Gujarat Power Limited - India
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- GMR Energy Limited - India
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Economic Council, Georgia
- Ministry of Transport, Egypt
- AsiaOL BioFuels Corp., Philippines
- LBH Netherlands Bv - Netherlands
- Salva Resources Pvt Ltd - India
- Borneo Indobara - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- Aboitiz Power Corporation - Philippines
- Africa Commodities Group - South Africa
- Kaltim Prima Coal - Indonesia
- Cement Manufacturers Association - India
- VISA Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Coal and Oil Company - UAE
- Vedanta Resources Plc - India
- White Energy Company Limited
- IEA Clean Coal Centre - UK
- Ind-Barath Power Infra Limited - India
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Madhucon Powers Ltd - India
- Meenaskhi Energy Private Limited - India
- Aditya Birla Group - India
- Global Coal Blending Company Limited - Australia
- Semirara Mining Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Minerals Council of Australia
- Karbindo Abesyapradhi - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Anglo American - United Kingdom
- Pendopo Energi Batubara - Indonesia
- Globalindo Alam Lestari - Indonesia
- McConnell Dowell - Australia
- Bhushan Steel Limited - India
- Karaikal Port Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Mintek Dendrill Indonesia
- Holcim Trading Pte Ltd - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- ASAPP Information Group - India
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- PNOC Exploration Corporation - Philippines
- Attock Cement Pakistan Limited
- Planning Commission, India
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Indogreen Group - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Eastern Coal Council - USA
- Medco Energi Mining Internasional
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Tamil Nadu electricity Board
- Ministry of Finance - Indonesia
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- Dalmia Cement Bharat India
- PTC India Limited - India
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Riau Bara Harum - Indonesia
- Simpson Spence & Young - Indonesia
- Gujarat Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Rio Tinto Coal - Australia
- Romanian Commodities Exchange
- Central Java Power - Indonesia
- Antam Resourcindo - Indonesia
- Kobexindo Tractors - Indoneisa
- Bhoruka Overseas - Indonesia
- Orica Australia Pty. Ltd.
- Directorate General of MIneral and Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- MS Steel International - UAE
- Global Business Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Wilmar Investment Holdings
- Metalloyd Limited - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Edison Trading Spa - Italy
- SMG Consultants - Indonesia
- Samtan Co., Ltd - South Korea
- Maheswari Brothers Coal Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- Merrill Lynch Commodities Europe
- CIMB Investment Bank - Malaysia
- OPG Power Generation Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Indika Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Makarim & Taira - Indonesia
- The Treasury - Australian Government
- GAC Shipping (India) Pvt Ltd
- Bangladesh Power Developement Board
- PetroVietnam Power Coal Import and Supply Company
- Price Waterhouse Coopers - Russia
- Bulk Trading Sa - Switzerland
- India Bulls Power Limited - India
- Bharathi Cement Corporation - India
- Gujarat Sidhee Cement - India
- Power Finance Corporation Ltd., India
- Banpu Public Company Limited - Thailand
- Asmin Koalindo Tuhup - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Essar Steel Hazira Ltd - India
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Kumho Petrochemical, South Korea
- Goldman Sachs - Singapore
- Georgia Ports Authority, United States
- Central Electricity Authority - India
- Mjunction Services Limited - India
- Altura Mining Limited, Indonesia
- The State Trading Corporation of India Ltd
- Grasim Industreis Ltd - India
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- Pipit Mutiara Jaya. PT, Indonesia
- Therma Luzon, Inc, Philippines
- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Orica Mining Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- Petron Corporation, Philippines
- Siam City Cement PLC, Thailand
- Barasentosa Lestari - Indonesia
- Deloitte Consulting - India
- Eastern Energy - Thailand
- Sree Jayajothi Cements Limited - India
- Intertek Mineral Services - Indonesia
- Indian Energy Exchange, India
- Electricity Authority, New Zealand
- GVK Power & Infra Limited - India
- Tata Chemicals Ltd - India
- Iligan Light & Power Inc, Philippines
- The University of Queensland
- IHS Mccloskey Coal Group - USA
- Vizag Seaport Private Limited - India
- Kepco SPC Power Corporation, Philippines
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Lanco Infratech Ltd - India
- Indo Tambangraya Megah - Indonesia
- Bayan Resources Tbk. - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Bukit Makmur.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Uttam Galva Steels Limited - India
- Baramulti Group, Indonesia
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- Chamber of Mines of South Africa
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Singapore Mercantile Exchange
- London Commodity Brokers - England
- Star Paper Mills Limited - India
- Larsen & Toubro Limited - India
- Mercuria Energy - Indonesia
- Independent Power Producers Association of India
- Maharashtra Electricity Regulatory Commission - India
- Sical Logistics Limited - India
- Standard Chartered Bank - UAE
- Renaissance Capital - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Trasteel International SA, Italy
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