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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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Wednesday, 07 March 12
ASSESS ASIAS POTENTIAL, DEVELOPMENTS AND APPETITE FOR SHALE AT SHALE GAS SUMMIT
Press Release - Assess Asia’s Potential, Developments and Appetite for Shale at Shale Gas Summit on 23-24 Apr, 2012 in Beijing
China is rep ...
Wednesday, 07 March 12
3RD MOZAMBIQUE COAL CONFERENCE
3rd Mozambique Coal Conference
2-4 July 2012 | Joaquim Chissano International Conference Centre , Maputo, Mozambique
http://www.immevents.com/mo ...
Wednesday, 07 March 12
DRY BULK MARKET KEEPS UP TIMID REBOUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its rising momentum yesterday, rising for the eighth straight session, on the back of renewed demand for smaller bulk c ...
Wednesday, 07 March 12
BUKIT ASAM EYES 39% RISE IN COAL SALES - INSIDER STORIES
Insider Stories reported that, PT Bukit Asam Tbk is scouting a 39% increase in coal sales volume to 18.66 million tons this year from last year with ...
Wednesday, 07 March 12
PETROSEA SEALS US$188 MIO CONTRACT - INSIDER STORIES
Insider Stories reported that, coal mining contractor PT Petrosea Tbk has secured a US$188 million additional contract from its affiliated firm PT S ...
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- Altura Mining Limited, Indonesia
- Timah Investasi Mineral - Indoneisa
- Intertek Mineral Services - Indonesia
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Edison Trading Spa - Italy
- Salva Resources Pvt Ltd - India
- Tamil Nadu electricity Board
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Malabar Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Standard Chartered Bank - UAE
- Karaikal Port Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- White Energy Company Limited
- Maheswari Brothers Coal Limited - India
- Planning Commission, India
- Meenaskhi Energy Private Limited - India
- Merrill Lynch Commodities Europe
- Binh Thuan Hamico - Vietnam
- Vizag Seaport Private Limited - India
- Straits Asia Resources Limited - Singapore
- Oldendorff Carriers - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Georgia Ports Authority, United States
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Indika Energy - Indonesia
- Coalindo Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Anglo American - United Kingdom
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- PowerSource Philippines DevCo
- San Jose City I Power Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Mjunction Services Limited - India
- GAC Shipping (India) Pvt Ltd
- Bukit Makmur.PT - Indonesia
- CIMB Investment Bank - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Videocon Industries ltd - India
- Bhatia International Limited - India
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Bayan Resources Tbk. - Indonesia
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- Banpu Public Company Limited - Thailand
- Eastern Coal Council - USA
- Rashtriya Ispat Nigam Limited - India
- New Zealand Coal & Carbon
- Star Paper Mills Limited - India
- Sarangani Energy Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Indian Energy Exchange, India
- Directorate General of MIneral and Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Power Finance Corporation Ltd., India
- Global Coal Blending Company Limited - Australia
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- Iligan Light & Power Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Metalloyd Limited - United Kingdom
- Manunggal Multi Energi - Indonesia
- Orica Australia Pty. Ltd.
- IEA Clean Coal Centre - UK
- Pipit Mutiara Jaya. PT, Indonesia
- Economic Council, Georgia
- Ambuja Cements Ltd - India
- Deloitte Consulting - India
- Africa Commodities Group - South Africa
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- Kartika Selabumi Mining - Indonesia
- VISA Power Limited - India
- Sojitz Corporation - Japan
- Semirara Mining Corp, Philippines
- Central Electricity Authority - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- European Bulk Services B.V. - Netherlands
- Indogreen Group - Indonesia
- Sical Logistics Limited - India
- CNBM International Corporation - China
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Pendopo Energi Batubara - Indonesia
- Simpson Spence & Young - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Jaiprakash Power Ventures ltd
- The University of Queensland
- Jindal Steel & Power Ltd - India
- London Commodity Brokers - England
- Coastal Gujarat Power Limited - India
- Leighton Contractors Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Agrawal Coal Company - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mercator Lines Limited - India
- The State Trading Corporation of India Ltd
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Medco Energi Mining Internasional
- Global Green Power PLC Corporation, Philippines
- Parliament of New Zealand
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Central Java Power - Indonesia
- OPG Power Generation Pvt Ltd - India
- Mintek Dendrill Indonesia
- Savvy Resources Ltd - HongKong
- Indo Tambangraya Megah - Indonesia
- Commonwealth Bank - Australia
- Ministry of Transport, Egypt
- Antam Resourcindo - Indonesia
- Minerals Council of Australia
- Cigading International Bulk Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- Bhushan Steel Limited - India
- Samtan Co., Ltd - South Korea
- Carbofer General Trading SA - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TeaM Sual Corporation - Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Offshore Bulk Terminal Pte Ltd, Singapore
- The Treasury - Australian Government
- Wilmar Investment Holdings
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Trasteel International SA, Italy
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Larsen & Toubro Limited - India
- Vedanta Resources Plc - India
- Kepco SPC Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Sree Jayajothi Cements Limited - India
- Gujarat Sidhee Cement - India
- McConnell Dowell - Australia
- Kideco Jaya Agung - Indonesia
- Bharathi Cement Corporation - India
- Marubeni Corporation - India
- Global Business Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Thiess Contractors Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Madhucon Powers Ltd - India
- Petron Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Sakthi Sugars Limited - India
- Independent Power Producers Association of India
- Posco Energy - South Korea
- Tata Chemicals Ltd - India
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- Ceylon Electricity Board - Sri Lanka
- Kumho Petrochemical, South Korea
- Alfred C Toepfer International GmbH - Germany
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- Dalmia Cement Bharat India
- Attock Cement Pakistan Limited
- Miang Besar Coal Terminal - Indonesia
- Orica Mining Services - Indonesia
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- Siam City Cement PLC, Thailand
- Wood Mackenzie - Singapore
- Electricity Generating Authority of Thailand
- Therma Luzon, Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Meralco Power Generation, Philippines
- Riau Bara Harum - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Makarim & Taira - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Kobexindo Tractors - Indoneisa
- Baramulti Group, Indonesia
- GVK Power & Infra Limited - India
- Sindya Power Generating Company Private Ltd
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Thai Mozambique Logistica
- Mercuria Energy - Indonesia
- Indian Oil Corporation Limited
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Singapore Mercantile Exchange
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Uttam Galva Steels Limited - India
- Parry Sugars Refinery, India
- SMC Global Power, Philippines
- Eastern Energy - Thailand
- Billiton Holdings Pty Ltd - Australia
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- Energy Development Corp, Philippines
- Ministry of Finance - Indonesia
- Goldman Sachs - Singapore
- Indonesian Coal Mining Association
- Xindia Steels Limited - India
- MS Steel International - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Australian Coal Association
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