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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, 01 May 12
VIETNAM FEARS IT MAY NOT SEEK COAL SUPPLIES - TBKTSG / VIETNAMNET BRIDGE
TBKTSG / VietNamNet Bridge reported that, with five coal-run thermopower plants under construction, PetroVietnam alone would need 18 million tons of ...
Sunday, 29 April 12
THE FREIGHT MARKET EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com - The BDI continued to go up with the support of Panamax/Supramax and was up by 8.34 pct closing at 1,156 points.
The cape index was ...
Sunday, 29 April 12
INDONESIAN SUB-BITUMINOUS COAL SWAPS FOR MAY 2012 DELIVERY WAS STABLE THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps for May deliveries stable this week, according to DSP of SGX AsiaClear OTC Coal Swaps. In the me ...
Friday, 27 April 12
BUKIT ASAMS NET INCOME UP 14% IN 1Q 2012 (UNAUDITED)
Press Release - PT Bukit Asam (Persero) Tbk, announced the Consolidated Financial Statements and Subsidiaries per 31 March 2012 (Unaudited).
Reve ...
Thursday, 26 April 12
AUSTRALIAS COKAL EXPANDS MET COAL POTENTIAL INTO WEST KALIMANTAN
COALspot.com - Global metallurgical coal group Cokal Limited (Cokal) (ASX:CKA) announced today it has completed the acquisition of 75.2% of PT Silan ...
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- Planning Commission, India
- OPG Power Generation Pvt Ltd - India
- India Bulls Power Limited - India
- Sarangani Energy Corporation, Philippines
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- Latin American Coal - Colombia
- Ind-Barath Power Infra Limited - India
- London Commodity Brokers - England
- Maharashtra Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Grasim Industreis Ltd - India
- Altura Mining Limited, Indonesia
- Formosa Plastics Group - Taiwan
- Independent Power Producers Association of India
- Toyota Tsusho Corporation, Japan
- Simpson Spence & Young - Indonesia
- Indonesian Coal Mining Association
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Heidelberg Cement - Germany
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Pendopo Energi Batubara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- GVK Power & Infra Limited - India
- Dalmia Cement Bharat India
- Price Waterhouse Coopers - Russia
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Commonwealth Bank - Australia
- Uttam Galva Steels Limited - India
- Central Electricity Authority - India
- Banpu Public Company Limited - Thailand
- Port Waratah Coal Services - Australia
- Madhucon Powers Ltd - India
- Vizag Seaport Private Limited - India
- Coal and Oil Company - UAE
- Marubeni Corporation - India
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Carbofer General Trading SA - India
- Power Finance Corporation Ltd., India
- Indogreen Group - Indonesia
- Thiess Contractors Indonesia
- Bukit Makmur.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Karbindo Abesyapradhi - Indoneisa
- Metalloyd Limited - United Kingdom
- Ministry of Finance - Indonesia
- Aboitiz Power Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- The Treasury - Australian Government
- Jorong Barutama Greston.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Tamil Nadu electricity Board
- Neyveli Lignite Corporation Ltd, - India
- SMG Consultants - Indonesia
- Electricity Generating Authority of Thailand
- Indian Oil Corporation Limited
- Coalindo Energy - Indonesia
- Mercator Lines Limited - India
- The University of Queensland
- Rashtriya Ispat Nigam Limited - India
- Sinarmas Energy and Mining - Indonesia
- Ministry of Mines - Canada
- Bhoruka Overseas - Indonesia
- Electricity Authority, New Zealand
- Savvy Resources Ltd - HongKong
- Iligan Light & Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Wood Mackenzie - Singapore
- Directorate General of MIneral and Coal - Indonesia
- Sakthi Sugars Limited - India
- Cement Manufacturers Association - India
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Sojitz Corporation - Japan
- Eastern Coal Council - USA
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Energy Development Corp, Philippines
- Essar Steel Hazira Ltd - India
- Africa Commodities Group - South Africa
- Bhushan Steel Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bhatia International Limited - India
- Gujarat Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Karaikal Port Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- CIMB Investment Bank - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aditya Birla Group - India
- Orica Australia Pty. Ltd.
- Indian Energy Exchange, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coastal Gujarat Power Limited - India
- Thai Mozambique Logistica
- TeaM Sual Corporation - Philippines
- GMR Energy Limited - India
- Global Coal Blending Company Limited - Australia
- Deloitte Consulting - India
- Chettinad Cement Corporation Ltd - India
- South Luzon Thermal Energy Corporation
- Meenaskhi Energy Private Limited - India
- LBH Netherlands Bv - Netherlands
- Globalindo Alam Lestari - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Kepco SPC Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- Chamber of Mines of South Africa
- IEA Clean Coal Centre - UK
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Energy - Thailand
- Parry Sugars Refinery, India
- VISA Power Limited - India
- Singapore Mercantile Exchange
- Ambuja Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Romanian Commodities Exchange
- Lanco Infratech Ltd - India
- Australian Coal Association
- PNOC Exploration Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Makarim & Taira - Indonesia
- Salva Resources Pvt Ltd - India
- Rio Tinto Coal - Australia
- Energy Link Ltd, New Zealand
- Borneo Indobara - Indonesia
- Petron Corporation, Philippines
- Bharathi Cement Corporation - India
- GN Power Mariveles Coal Plant, Philippines
- Larsen & Toubro Limited - India
- Renaissance Capital - South Africa
- Georgia Ports Authority, United States
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Edison Trading Spa - Italy
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Asmin Koalindo Tuhup - Indonesia
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Economic Council, Georgia
- Leighton Contractors Pty Ltd - Australia
- Medco Energi Mining Internasional
- McConnell Dowell - Australia
- Orica Mining Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Transport, Egypt
- San Jose City I Power Corp, Philippines
- PowerSource Philippines DevCo
- The State Trading Corporation of India Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Agrawal Coal Company - India
- Global Business Power Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Minerals Council of Australia
- Kalimantan Lumbung Energi - Indonesia
- Bulk Trading Sa - Switzerland
- Mintek Dendrill Indonesia
- CNBM International Corporation - China
- Vedanta Resources Plc - India
- ASAPP Information Group - India
- Holcim Trading Pte Ltd - Singapore
- Alfred C Toepfer International GmbH - Germany
- MS Steel International - UAE
- Bayan Resources Tbk. - Indonesia
- SMC Global Power, Philippines
- Interocean Group of Companies - India
- Kobexindo Tractors - Indoneisa
- Posco Energy - South Korea
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Anglo American - United Kingdom
- Kumho Petrochemical, South Korea
- Indika Energy - Indonesia
- Gujarat Sidhee Cement - India
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Tata Chemicals Ltd - India
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Riau Bara Harum - Indonesia
- Bangladesh Power Developement Board
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- PTC India Limited - India
- Directorate Of Revenue Intelligence - India
- Siam City Cement - Thailand
- Ceylon Electricity Board - Sri Lanka
- ICICI Bank Limited - India
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