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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, 27 February 12
INDONESIAN COAL EXPORTS TO CHINA DROPS 39.76 PERCENT IN JANUARY 2012
COALspot.com: Indonesia, the world largest coal exporter, shipped 28.21* mln mt of coal in January 2012, slightly lower than its December 2011 ...
Monday, 27 February 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
The pessimism in the dry market persists with the Baltic Dry Index still trying to find a steady pace of growth and average time charter earnings fo ...
Sunday, 26 February 12
THE FREIGHT RATES FOR INDONESIA TO INDIA IS LIKELY TO BE FIRM FOR NEXT 2/3 WEEKS - VISTAAR
COALspot.com – “There was not much change in the BDI and other indices this week except for the Panamax which was down by 11.91 pc ...
Friday, 24 February 12
DRY BULK MARKET POSTS FIRST REBOUND IN A WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
As was expected since mid-week, the dry bulk market's benchmark, the BDI (Baltic Dry Index) has managed to put a stop in a 6-day losing rally, endi ...
Thursday, 23 February 12
2.5 PANAMAX VESSELS PER AVAILABLE CARGO FOR MARCH DATES - FEARN BULK
Handy
Another depressing week for Supras in both basins. Lack of fresh business and over-supply of tonnage in the Atlantic pushed rates south. Cont ...
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- Planning Commission, India
- Manunggal Multi Energi - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Orica Australia Pty. Ltd.
- Krishnapatnam Port Company Ltd. - India
- Gujarat Sidhee Cement - India
- Toyota Tsusho Corporation, Japan
- Straits Asia Resources Limited - Singapore
- Indonesian Coal Mining Association
- Mercuria Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Eastern Energy - Thailand
- Tata Chemicals Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- San Jose City I Power Corp, Philippines
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- Banpu Public Company Limited - Thailand
- Bharathi Cement Corporation - India
- Bhoruka Overseas - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Latin American Coal - Colombia
- Barasentosa Lestari - Indonesia
- Uttam Galva Steels Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- Star Paper Mills Limited - India
- CNBM International Corporation - China
- Kepco SPC Power Corporation, Philippines
- Bangladesh Power Developement Board
- Gujarat Mineral Development Corp Ltd - India
- Altura Mining Limited, Indonesia
- GMR Energy Limited - India
- Thiess Contractors Indonesia
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- Miang Besar Coal Terminal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Cigading International Bulk Terminal - Indonesia
- Metalloyd Limited - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indika Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Videocon Industries ltd - India
- Indogreen Group - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Chamber of Mines of South Africa
- The University of Queensland
- Mercator Lines Limited - India
- London Commodity Brokers - England
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Generating Authority of Thailand
- Bukit Baiduri Energy - Indonesia
- McConnell Dowell - Australia
- Africa Commodities Group - South Africa
- Bayan Resources Tbk. - Indonesia
- ICICI Bank Limited - India
- Heidelberg Cement - Germany
- Global Green Power PLC Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- PetroVietnam Power Coal Import and Supply Company
- The Treasury - Australian Government
- European Bulk Services B.V. - Netherlands
- ASAPP Information Group - India
- Samtan Co., Ltd - South Korea
- Indo Tambangraya Megah - Indonesia
- Wood Mackenzie - Singapore
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Sree Jayajothi Cements Limited - India
- India Bulls Power Limited - India
- GVK Power & Infra Limited - India
- Orica Mining Services - Indonesia
- Savvy Resources Ltd - HongKong
- Carbofer General Trading SA - India
- Bukit Makmur.PT - Indonesia
- Ministry of Transport, Egypt
- Antam Resourcindo - Indonesia
- Jindal Steel & Power Ltd - India
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- Port Waratah Coal Services - Australia
- Xindia Steels Limited - India
- Mintek Dendrill Indonesia
- Bulk Trading Sa - Switzerland
- Maharashtra Electricity Regulatory Commission - India
- Merrill Lynch Commodities Europe
- Coalindo Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Lanco Infratech Ltd - India
- Minerals Council of Australia
- Sindya Power Generating Company Private Ltd
- Thai Mozambique Logistica
- PTC India Limited - India
- VISA Power Limited - India
- Electricity Authority, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Makarim & Taira - Indonesia
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Malabar Cements Ltd - India
- Edison Trading Spa - Italy
- Timah Investasi Mineral - Indoneisa
- Iligan Light & Power Inc, Philippines
- Standard Chartered Bank - UAE
- Semirara Mining Corp, Philippines
- Independent Power Producers Association of India
- Petron Corporation, Philippines
- Indian Oil Corporation Limited
- Price Waterhouse Coopers - Russia
- Deloitte Consulting - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Grasim Industreis Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Romanian Commodities Exchange
- Sarangani Energy Corporation, Philippines
- MS Steel International - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ambuja Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- Singapore Mercantile Exchange
- Kalimantan Lumbung Energi - Indonesia
- Power Finance Corporation Ltd., India
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- Baramulti Group, Indonesia
- Kumho Petrochemical, South Korea
- Simpson Spence & Young - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Madhucon Powers Ltd - India
- Sakthi Sugars Limited - India
- Maheswari Brothers Coal Limited - India
- Salva Resources Pvt Ltd - India
- Renaissance Capital - South Africa
- Jaiprakash Power Ventures ltd
- Ind-Barath Power Infra Limited - India
- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
- Globalindo Alam Lestari - Indonesia
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Borneo Indobara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Australian Coal Association
- Indian Energy Exchange, India
- Kapuas Tunggal Persada - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Essar Steel Hazira Ltd - India
- Tamil Nadu electricity Board
- Chettinad Cement Corporation Ltd - India
- Pendopo Energi Batubara - Indonesia
- Medco Energi Mining Internasional
- Ministry of Mines - Canada
- Mjunction Services Limited - India
- Siam City Cement PLC, Thailand
- IEA Clean Coal Centre - UK
- Sinarmas Energy and Mining - Indonesia
- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Coal and Oil Company - UAE
- PowerSource Philippines DevCo
- New Zealand Coal & Carbon
- Vizag Seaport Private Limited - India
- Dalmia Cement Bharat India
- Therma Luzon, Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Meralco Power Generation, Philippines
- Kartika Selabumi Mining - Indonesia
- Posco Energy - South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Wilmar Investment Holdings
- Karaikal Port Pvt Ltd - India
- Energy Development Corp, Philippines
- Global Coal Blending Company Limited - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Bhushan Steel Limited - India
- Trasteel International SA, Italy
- Bhatia International Limited - India
- Sical Logistics Limited - India
- PNOC Exploration Corporation - Philippines
- Oldendorff Carriers - Singapore
- GAC Shipping (India) Pvt Ltd
- White Energy Company Limited
- Parliament of New Zealand
- Larsen & Toubro Limited - India
- Siam City Cement - Thailand
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- Semirara Mining and Power Corporation, Philippines
- Goldman Sachs - Singapore
- Kobexindo Tractors - Indoneisa
- Vedanta Resources Plc - India
- Ministry of Finance - Indonesia
- Kaltim Prima Coal - Indonesia
- Aditya Birla Group - India
- Australian Commodity Traders Exchange
- Holcim Trading Pte Ltd - Singapore
- Riau Bara Harum - Indonesia
- SMC Global Power, Philippines
- Coastal Gujarat Power Limited - India
- Marubeni Corporation - India
- Central Java Power - Indonesia
- Commonwealth Bank - Australia
- Billiton Holdings Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- Parry Sugars Refinery, India
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