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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 March 12
DELTA DUNIA 1M OVERBURDEN DROPS 3.1% - INSIDER STORIES
Insider Stories reported that, Indonesia's second largest coal mining contractor PT Delta Dunia Makmur Tbk (DOID) reported a 25 million bank ...
Monday, 12 March 12
DRY BULK RATES WILL REMAIN LOW IN 2012 SAYS DANISH SHIP FINANCE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In its annual shipping survey Danish Ship Finance said that the current outlook for the Dry Bulk market seems unlikely to foster higher rates in any ...
Monday, 12 March 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
The first days of March appear to be more encouraging for dry bulk operators, but the outlook is still gloomy for the rest of year with earnings for ...
Sunday, 11 March 12
FREIGHT RATES FOR INDONESIA TO INDIA WILL CONTINUE TO REMAIN FIRM- VISTAAR
COALspot.com - This week saw another upward trend with all indices up except for the Cape index.
The BDI was up by 6.87 pct closing at 824 points ...
Friday, 09 March 12
MINING IN INDONESIA: RESTRICTION ON FOREIGN INVESTMENT - SUNIL K KUMBHAT
COALspot.com - Recently Govt has passed regulation instructing foreign mining companies to reduce their ownership stake.
The regulation known as ...
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- Gujarat Mineral Development Corp Ltd - India
- India Bulls Power Limited - India
- Sree Jayajothi Cements Limited - India
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Gujarat Electricity Regulatory Commission - India
- Kideco Jaya Agung - Indonesia
- Oldendorff Carriers - Singapore
- McConnell Dowell - Australia
- OPG Power Generation Pvt Ltd - India
- Mintek Dendrill Indonesia
- Merrill Lynch Commodities Europe
- Riau Bara Harum - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indogreen Group - Indonesia
- The Treasury - Australian Government
- Globalindo Alam Lestari - Indonesia
- Makarim & Taira - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- Kumho Petrochemical, South Korea
- Orica Australia Pty. Ltd.
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- Bhoruka Overseas - Indonesia
- Indian Oil Corporation Limited
- Gujarat Sidhee Cement - India
- Trasteel International SA, Italy
- Salva Resources Pvt Ltd - India
- Malabar Cements Ltd - India
- Economic Council, Georgia
- Electricity Authority, New Zealand
- Intertek Mineral Services - Indonesia
- Simpson Spence & Young - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Interocean Group of Companies - India
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- Semirara Mining Corp, Philippines
- Deloitte Consulting - India
- Minerals Council of Australia
- CNBM International Corporation - China
- Pendopo Energi Batubara - Indonesia
- Jaiprakash Power Ventures ltd
- GN Power Mariveles Coal Plant, Philippines
- LBH Netherlands Bv - Netherlands
- Baramulti Group, Indonesia
- Ministry of Mines - Canada
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- SMC Global Power, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Xindia Steels Limited - India
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- TNB Fuel Sdn Bhd - Malaysia
- IHS Mccloskey Coal Group - USA
- Formosa Plastics Group - Taiwan
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- Global Coal Blending Company Limited - Australia
- Parliament of New Zealand
- Directorate Of Revenue Intelligence - India
- Kohat Cement Company Ltd. - Pakistan
- Miang Besar Coal Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Indian Energy Exchange, India
- Petron Corporation, Philippines
- Coal and Oil Company - UAE
- Metalloyd Limited - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- Tata Chemicals Ltd - India
- Edison Trading Spa - Italy
- PowerSource Philippines DevCo
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Vedanta Resources Plc - India
- ASAPP Information Group - India
- VISA Power Limited - India
- GAC Shipping (India) Pvt Ltd
- MS Steel International - UAE
- Holcim Trading Pte Ltd - Singapore
- Sical Logistics Limited - India
- Straits Asia Resources Limited - Singapore
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Goldman Sachs - Singapore
- SN Aboitiz Power Inc, Philippines
- Wilmar Investment Holdings
- Petrochimia International Co. Ltd.- Taiwan
- Cement Manufacturers Association - India
- Alfred C Toepfer International GmbH - Germany
- South Luzon Thermal Energy Corporation
- San Jose City I Power Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Planning Commission, India
- Singapore Mercantile Exchange
- Price Waterhouse Coopers - Russia
- Jorong Barutama Greston.PT - Indonesia
- Africa Commodities Group - South Africa
- Borneo Indobara - Indonesia
- Kartika Selabumi Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Sinarmas Energy and Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sarangani Energy Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Ambuja Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- PTC India Limited - India
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Kobexindo Tractors - Indoneisa
- Carbofer General Trading SA - India
- Sojitz Corporation - Japan
- Renaissance Capital - South Africa
- Manunggal Multi Energi - Indonesia
- Meralco Power Generation, Philippines
- Anglo American - United Kingdom
- Essar Steel Hazira Ltd - India
- Madhucon Powers Ltd - India
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Australian Coal Association
- Posco Energy - South Korea
- Krishnapatnam Port Company Ltd. - India
- Tamil Nadu electricity Board
- SMG Consultants - Indonesia
- Barasentosa Lestari - Indonesia
- Therma Luzon, Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Australian Commodity Traders Exchange
- IEA Clean Coal Centre - UK
- Central Java Power - Indonesia
- ICICI Bank Limited - India
- Eastern Coal Council - USA
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- Latin American Coal - Colombia
- Grasim Industreis Ltd - India
- Bhatia International Limited - India
- Bhushan Steel Limited - India
- TeaM Sual Corporation - Philippines
- Lanco Infratech Ltd - India
- Rio Tinto Coal - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Energy Development Corp, Philippines
- Videocon Industries ltd - India
- Ceylon Electricity Board - Sri Lanka
- Aboitiz Power Corporation - Philippines
- Parry Sugars Refinery, India
- Marubeni Corporation - India
- PNOC Exploration Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- Altura Mining Limited, Indonesia
- Vizag Seaport Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Siam City Cement PLC, Thailand
- Bukit Makmur.PT - Indonesia
- Agrawal Coal Company - India
- Global Business Power Corporation, Philippines
- Thai Mozambique Logistica
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Orica Mining Services - Indonesia
- Samtan Co., Ltd - South Korea
- Star Paper Mills Limited - India
- Global Green Power PLC Corporation, Philippines
- Bangladesh Power Developement Board
- Aditya Birla Group - India
- Eastern Energy - Thailand
- Dalmia Cement Bharat India
- Sakthi Sugars Limited - India
- International Coal Ventures Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Finance - Indonesia
- Power Finance Corporation Ltd., India
- Bukit Asam (Persero) Tbk - Indonesia
- Indonesian Coal Mining Association
- Vijayanagar Sugar Pvt Ltd - India
- Standard Chartered Bank - UAE
- Coalindo Energy - Indonesia
- Banpu Public Company Limited - Thailand
- London Commodity Brokers - England
- Thiess Contractors Indonesia
- Indika Energy - Indonesia
- Port Waratah Coal Services - Australia
- Cigading International Bulk Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kepco SPC Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Independent Power Producers Association of India
- Kaltim Prima Coal - Indonesia
- Karaikal Port Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- GMR Energy Limited - India
- Ind-Barath Power Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- White Energy Company Limited
- Medco Energi Mining Internasional
- Mercator Lines Limited - India
- Timah Investasi Mineral - Indoneisa
- Commonwealth Bank - Australia
- Indo Tambangraya Megah - Indonesia
- Mercuria Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
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