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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, 19 January 12
SOUTHGOBI RESOURCES SELLS MORE THAN FOUR MILLION TONNES OF COAL IN 2011, 58% MORE THAN 2010
COALspot.com - SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) has successfully complets year 2011 on guidance in terms of coal sales and production.
...
Thursday, 19 January 12
14TH VOGP MEETING IN HO CHI MINH CITY HANDS OUT LATEST UPDATES AND DEVELOPMENTS IN VIETNAM'S ENERGY INDUSTRY
Press Release: At upcoming 14th Vietnam Oil Gas Power on 27-28 Feb in Ho Chi Minh City the industry’s most influential names including Petrovi ...
Thursday, 19 January 12
DELTA DUNIA SEALS US$820 MIO CONTRACT INSIDER STORIES
Insider Stories reported that, PT Delta Dunia Makmur Tbk (DOID) has announced that its primary operating subsidiary, PT Bukit Makmur Mandiri Utama ( ...
Wednesday, 18 January 12
WARM WINTER ACROSS EUROPE HAS IMPACTED NEGATIVELY COAL DEMAND - BRS
With the Chinese New Year just a week away, all markets are slowing down. The drop in freight rates for all sizes has been significant over the past ...
Wednesday, 18 January 12
DRY BULK MARKET'S DRAMA CONTINUES IN START OF NEW WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A flurry of newbuilding deliveries, coupled with a slow start to the new year, a typical trend for the dry bulk market, has led the industry's benc ...
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- Videocon Industries ltd - India
- PTC India Limited - India
- London Commodity Brokers - England
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- Thiess Contractors Indonesia
- Commonwealth Bank - Australia
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GVK Power & Infra Limited - India
- Wood Mackenzie - Singapore
- Jindal Steel & Power Ltd - India
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- Kepco SPC Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Sree Jayajothi Cements Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Barasentosa Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- Tata Chemicals Ltd - India
- Baramulti Group, Indonesia
- The University of Queensland
- Karbindo Abesyapradhi - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Price Waterhouse Coopers - Russia
- Independent Power Producers Association of India
- Sinarmas Energy and Mining - Indonesia
- Rio Tinto Coal - Australia
- Bangladesh Power Developement Board
- Aboitiz Power Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Ministry of Transport, Egypt
- Global Green Power PLC Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- Coalindo Energy - Indonesia
- Ministry of Finance - Indonesia
- Georgia Ports Authority, United States
- TeaM Sual Corporation - Philippines
- McConnell Dowell - Australia
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- Sical Logistics Limited - India
- ICICI Bank Limited - India
- Mercator Lines Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
- Toyota Tsusho Corporation, Japan
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Dalmia Cement Bharat India
- Carbofer General Trading SA - India
- Salva Resources Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Economic Council, Georgia
- Iligan Light & Power Inc, Philippines
- Indian Energy Exchange, India
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Kideco Jaya Agung - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Essar Steel Hazira Ltd - India
- South Luzon Thermal Energy Corporation
- The Treasury - Australian Government
- Lanco Infratech Ltd - India
- Posco Energy - South Korea
- Neyveli Lignite Corporation Ltd, - India
- Orica Mining Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Romanian Commodities Exchange
- Karaikal Port Pvt Ltd - India
- Sojitz Corporation - Japan
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Maheswari Brothers Coal Limited - India
- Borneo Indobara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Parry Sugars Refinery, India
- Kaltim Prima Coal - Indonesia
- Interocean Group of Companies - India
- Energy Development Corp, Philippines
- Deloitte Consulting - India
- Madhucon Powers Ltd - India
- Formosa Plastics Group - Taiwan
- Coal and Oil Company - UAE
- CNBM International Corporation - China
- Minerals Council of Australia
- Ind-Barath Power Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
- Savvy Resources Ltd - HongKong
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- San Jose City I Power Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- Kalimantan Lumbung Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Marubeni Corporation - India
- Wilmar Investment Holdings
- PNOC Exploration Corporation - Philippines
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Port Waratah Coal Services - Australia
- Timah Investasi Mineral - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Banpu Public Company Limited - Thailand
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Kobexindo Tractors - Indoneisa
- Kartika Selabumi Mining - Indonesia
- Mjunction Services Limited - India
- Leighton Contractors Pty Ltd - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ambuja Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Indika Energy - Indonesia
- Mintek Dendrill Indonesia
- Altura Mining Limited, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Bukit Makmur.PT - Indonesia
- Bhatia International Limited - India
- Sindya Power Generating Company Private Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Oldendorff Carriers - Singapore
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- MS Steel International - UAE
- Straits Asia Resources Limited - Singapore
- Chamber of Mines of South Africa
- Bharathi Cement Corporation - India
- Jaiprakash Power Ventures ltd
- Electricity Authority, New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- OPG Power Generation Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Rashtriya Ispat Nigam Limited - India
- Bukit Baiduri Energy - Indonesia
- Medco Energi Mining Internasional
- Eastern Energy - Thailand
- Heidelberg Cement - Germany
- Meenaskhi Energy Private Limited - India
- Thai Mozambique Logistica
- Aditya Birla Group - India
- PowerSource Philippines DevCo
- Sakthi Sugars Limited - India
- Cigading International Bulk Terminal - Indonesia
- Directorate Of Revenue Intelligence - India
- Standard Chartered Bank - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Malabar Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Larsen & Toubro Limited - India
- Bayan Resources Tbk. - Indonesia
- Goldman Sachs - Singapore
- Planning Commission, India
- ASAPP Information Group - India
- Star Paper Mills Limited - India
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Chettinad Cement Corporation Ltd - India
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Edison Trading Spa - Italy
- Siam City Cement - Thailand
- Krishnapatnam Port Company Ltd. - India
- Africa Commodities Group - South Africa
- Grasim Industreis Ltd - India
- Globalindo Alam Lestari - Indonesia
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Sarangani Energy Corporation, Philippines
- Indogreen Group - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Latin American Coal - Colombia
- Metalloyd Limited - United Kingdom
- Mercuria Energy - Indonesia
- SMC Global Power, Philippines
- White Energy Company Limited
- Parliament of New Zealand
- Gujarat Mineral Development Corp Ltd - India
- Eastern Coal Council - USA
- Indonesian Coal Mining Association
- Central Electricity Authority - India
- Tamil Nadu electricity Board
- Makarim & Taira - Indonesia
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- LBH Netherlands Bv - Netherlands
- GMR Energy Limited - India
- Binh Thuan Hamico - Vietnam
- Global Coal Blending Company Limited - Australia
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