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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, 05 July 12
BUMI ACHIEVES HIGHER SELLING PRICE IN FIRST QUARTER
COALspot.com - PT Bumi Resources Tbk (BUMI), Indonesia's largest coal producer and exporter, has successfully maintained a higher sales margin, des ...
Tuesday, 03 July 12
DRY BULK MARKET INCHED FORWARD AT THE START OF THE WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market inched forward at the beginning of the new week, prior to the US holidays regarding the celebration of the 4th of July, which is ...
Monday, 02 July 12
ORPHEUS STRENGTHENS REVENUE STREAM WITH NEW ROYALTY AGREEMENT AT THE B2 COAL PROJECT
Orpheus Energy (ASX:OEG) is pleased to advise that it has executed a life of mine Royalty Agreement with Indonesian mining contractor PT Debbia Mini ...
Monday, 02 July 12
DRY BULK DEMAND TO RISE TO 3.6 BILLION TONNES IN 2012, BUT NEW BUILDING DELIVERIES ARE
In its latest analysis on the dry bulk market fundamentals, DVB Bank said that dry bulk cargo demand is forecast to rise to approximately 3.6 billio ...
Sunday, 01 July 12
AUSTRALIAS CARBON TAX - SUNIL K KUMBHAT
COALspot.com - Climate Change
Climate change and global warming have now become buzzwords the world over. The disastrous consequences for global ...
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- Antam Resourcindo - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Coalindo Energy - Indonesia
- Metalloyd Limited - United Kingdom
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- SN Aboitiz Power Inc, Philippines
- Petron Corporation, Philippines
- Energy Link Ltd, New Zealand
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Holcim Trading Pte Ltd - Singapore
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- South Luzon Thermal Energy Corporation
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sree Jayajothi Cements Limited - India
- Kalimantan Lumbung Energi - Indonesia
- PTC India Limited - India
- Billiton Holdings Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Coal Council - USA
- Planning Commission, India
- Indian Oil Corporation Limited
- Aboitiz Power Corporation - Philippines
- Singapore Mercantile Exchange
- Jorong Barutama Greston.PT - Indonesia
- Banpu Public Company Limited - Thailand
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- Therma Luzon, Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Bukit Makmur.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- Larsen & Toubro Limited - India
- Binh Thuan Hamico - Vietnam
- Bharathi Cement Corporation - India
- Cement Manufacturers Association - India
- Thai Mozambique Logistica
- Latin American Coal - Colombia
- Chamber of Mines of South Africa
- Toyota Tsusho Corporation, Japan
- Power Finance Corporation Ltd., India
- Kumho Petrochemical, South Korea
- McConnell Dowell - Australia
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- New Zealand Coal & Carbon
- Australian Coal Association
- Videocon Industries ltd - India
- Manunggal Multi Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jindal Steel & Power Ltd - India
- Sakthi Sugars Limited - India
- Electricity Authority, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Bulk Trading Sa - Switzerland
- Rashtriya Ispat Nigam Limited - India
- Cigading International Bulk Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Vedanta Resources Plc - India
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Global Coal Blending Company Limited - Australia
- San Jose City I Power Corp, Philippines
- Indogreen Group - Indonesia
- Bangladesh Power Developement Board
- Intertek Mineral Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- International Coal Ventures Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Bhushan Steel Limited - India
- Eastern Energy - Thailand
- Economic Council, Georgia
- Trasteel International SA, Italy
- IEA Clean Coal Centre - UK
- Kartika Selabumi Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- TeaM Sual Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- IHS Mccloskey Coal Group - USA
- Pendopo Energi Batubara - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Deloitte Consulting - India
- GN Power Mariveles Coal Plant, Philippines
- Grasim Industreis Ltd - India
- Karaikal Port Pvt Ltd - India
- Parliament of New Zealand
- Uttam Galva Steels Limited - India
- Mjunction Services Limited - India
- Ambuja Cements Ltd - India
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- SMC Global Power, Philippines
- Indonesian Coal Mining Association
- Heidelberg Cement - Germany
- Interocean Group of Companies - India
- Wilmar Investment Holdings
- Sinarmas Energy and Mining - Indonesia
- Sical Logistics Limited - India
- Posco Energy - South Korea
- Meenaskhi Energy Private Limited - India
- Straits Asia Resources Limited - Singapore
- Ministry of Finance - Indonesia
- PNOC Exploration Corporation - Philippines
- Attock Cement Pakistan Limited
- Barasentosa Lestari - Indonesia
- Rio Tinto Coal - Australia
- Vizag Seaport Private Limited - India
- Minerals Council of Australia
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Meralco Power Generation, Philippines
- Goldman Sachs - Singapore
- Standard Chartered Bank - UAE
- Romanian Commodities Exchange
- Bukit Baiduri Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Sidhee Cement - India
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- Kepco SPC Power Corporation, Philippines
- ASAPP Information Group - India
- Dalmia Cement Bharat India
- Siam City Cement PLC, Thailand
- Kaltim Prima Coal - Indonesia
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Orica Mining Services - Indonesia
- Medco Energi Mining Internasional
- Port Waratah Coal Services - Australia
- Asmin Koalindo Tuhup - Indonesia
- Formosa Plastics Group - Taiwan
- Central Electricity Authority - India
- Renaissance Capital - South Africa
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Salva Resources Pvt Ltd - India
- Indian Energy Exchange, India
- The Treasury - Australian Government
- Merrill Lynch Commodities Europe
- Pipit Mutiara Jaya. PT, Indonesia
- Aditya Birla Group - India
- London Commodity Brokers - England
- OPG Power Generation Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Lanco Infratech Ltd - India
- Global Green Power PLC Corporation, Philippines
- Central Java Power - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- GMR Energy Limited - India
- Ministry of Mines - Canada
- ICICI Bank Limited - India
- Essar Steel Hazira Ltd - India
- Commonwealth Bank - Australia
- Samtan Co., Ltd - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Mintek Dendrill Indonesia
- GAC Shipping (India) Pvt Ltd
- Global Business Power Corporation, Philippines
- Independent Power Producers Association of India
- The State Trading Corporation of India Ltd
- Semirara Mining and Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Sarangani Energy Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Tamil Nadu electricity Board
- Tata Chemicals Ltd - India
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Georgia Ports Authority, United States
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- Globalindo Alam Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Coastal Gujarat Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Carbofer General Trading SA - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Australian Commodity Traders Exchange
- White Energy Company Limited
- India Bulls Power Limited - India
- Riau Bara Harum - Indonesia
- Sindya Power Generating Company Private Ltd
- Mercuria Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Ministry of Transport, Egypt
- Directorate General of MIneral and Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Timah Investasi Mineral - Indoneisa
- MS Steel International - UAE
- Madhucon Powers Ltd - India
- Chettinad Cement Corporation Ltd - India
- Mercator Lines Limited - India
- Anglo American - United Kingdom
- The University of Queensland
- Electricity Generating Authority of Thailand
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