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Monday, 20 February 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU
 The dry market experienced one more disappointing week with tonnage oversupply and limited cargo demand that pushes earnings for shipping players to levels near or below operating expenses. The Baltic Dry Index closed at 717 points on Friday of February 17th, gaining only two points more than the previous week’s closing and it is now standing 55 points above from the historical low level in the last 26 years of 662 points on February 1st. The dry market normally shows a plunge at the beginning of every year as Chinese festivities bring a lull in iron ore buying activity with the BDI finding its pace upon the return from holidays. However, the index now seems that struggles to keep a steady pace of growth since it is still below the psychological barrier of 1,000 points and it is unquestionable if would surpass this level till the end of February. Following its positive upward movement in the previous week by gaining 68 points more on a weekly basis and panamaxes being the best performers, the sentiment is again distrustful with capesize earnings being extremely flat and handysizes showing a stronger resilience this week.
The BHSI showed a 3.5% week-on-week increase in contrast with a 1.8% week-on-week fall in the BPI from its 39.5% remarkable increase in the week ending February 10th. Overall, the BDI showed a minimal rise of 0.2% on a weekly basis by falling for the last three consecutive days of the week and ending to loose 12 points from the high of 729 points at the beginning of the week. Average time charter earnings for all vessel sizes are still floating at low levels, below $10,000/day, with increased worries for a prompt revival before the end of the first quarter of the year. Panamax and supramax vessels seem to have a better outlook to break the barrier of $10,000/day by earning ground from a strong Chinese coal demand, while capesizes may suffer for a longer period of time since the Chinese iron ore buying appetite, the main driver for healthier capesize earnings, is still fragile.
For large size vessels, capesizes, the market was extremely flat with the BCI gaining only 4 points more at the end of the week by closing at 1461 points, up by 0.27% on a weekly basis. The Atlantic market remains particular inactive despite some iron ore activity from Western Australia. W Australia/Qingdao rates is said to have improved only slightly, to $7,70/tonne, compared to $7,60/tonne last week. In the panamax market, the week opened with a degree of optimism with the index surpassing the 1,000 points mark level, but by the end of the week it fell to 949 points, loosing 18 points, down 1.86% from previous week’s closing.
The week ended also negative for supramax owners with a retreat of decline in Atlantic supramax rates and a rise in Pacific from record lows. Owners with tonnage in the European side found almost impossible to consider the ballast option at the prevailing freight rates and bunkering expenses, while owners in the East with tonnage seem to have better chance with rates covering operating expenses. Some reasonable mineral business from Indonesia gave a substance in the segment with the BSI loosing only 4 points from previous week’s closing and ending at 641 points, down by 0.6% week-on-week basis.
The current status of China’s steel market and the high levels of iron ore inventories do not currently support massive iron ore imports enough to lift the BDI above 1,000 points and capesize earnings at the levels of more than $10,000 day.
According to Data from the General Administration of Customs, imports by China, the world’s biggest buyer of the steel making ingredient, fell 7.4% to 59,32 million tons in January from a month earlier due to the Lunar New Year holiday. Even January gives a distorted picture for Chinese buying sentiment due to National Festivities; China’s steel market remains sluggish. The China Iron and Steel Association reported that daily crude steel production averaged 1,67 million tons from January 21 to January 31. This is similar with the average daily production that occurred during January 11 to January 20, but is down significantly from last year’s record of 2,02 mt average daily production that occurred during June 21 to June 30.
Furthermore, Chinese iron ore inventories reached the alarming level of nearly 100 million mt by the beginning of February and fell to 99.97 million tons by February 13th, but it is still hefty and indicates the slump in demand for steel production in China. Due to lower demand as a result of the slowing economy and tight liquidity, steel prices have been plunging since last October, leaving steel mills with marginal profits or making losses. Major mill Angang Steel, for instance, announced a net loss of some 2.2 billion yuan for 2011 due to rising raw material costs. CISA Chairman Zhu Jimin said that the possibility of losses and meager profits for steel mills is likely to increase this year as increased costs, falling demand and financing difficulties will continue to distress the steel industry.
The hefty amount of Chinese inventories and the lower from the biggest consumer China have plunged the iron ore price last week in the lowest level since October. Ore with 62 percent content at the Chinese port of Tianjin fell 1.6 percent to $137.40 per metric ton on Thursday 16th, data from The Steel Index showed. Vale S.A., the world’s second largest miner by volume, reported a 20% fall in its net profit for the fourth quarter of last year by recording $4,67 billion compared with a $5,92 billion a year earlier, citing as primary reason the decline in the iron ore price. Vale reported quarterly sales of $14,8 billion from reduced iron ore prices and the debt crisis that caused European shipments to slump. Credit Suisse predicted in a report that tighter market conditions would continue in 2012 with iron ore prices expected to be weaker. The report stated Brazilian iron ore miners will face lower year-on-year results due to lack of volume growth and 10% lower year on year average price.
However, Australia’s mega iron ore producers are planning to boost production amid current slow Chinese steel demand. Australia supplies about 43 percent of China's iron ore imports, with most coming from BHP, Rio and Fortescue. According to Bank of America-Merrill Lynch forecasts, China's steel demand is expected to grow 6 percent in 2012 and 5.8 percent in 2013, down from the stunning 12.8 percent compound annual growth during 2008-11.
BHP Billiton Ltd., the biggest mining company, said Feb. 12 a price decline probably won’t affect plans to spend $80 billion over the next five years to boost output along with copper and coal. “The Chinese have been buying well in advance,” said Gavin Wendt, founder and senior resource analyst at Mine Life Pty in Sydney. “They like to buy these commodities when the price is low and buy it in significant volumes, essentially more than what they need and stockpile it”.
Fortescue Metals Group is under a construction program to nearly triple production to 155 million tonnes in a year after securing funding last October. Fortescue Metals Group expects iron ore prices will remain around $US140 ($A131.48) per tonne in the short-to-medium term as Chinese demand remains strong but little new supply comes onto the market.Rio Tinto also assigned $3.4 billion to expand iron ore mining in Australia, and expects its iron ore production in Australia to reach 230 million tonnes by the end of this quarter and 283 million by the end of calendar 2013.
The recent downturn of the dry market stemming mainly from slow Chinese demand does not hamper major iron ore producers that still see future in China’s buying power that could lead steel market and vessels earnings at higher levels. The question now is how the freight markets will response to a revamping of Chinese iron ore consuming at the current oversupply tonnage.
Source: Maria Bertzeletou Hellenic Shipping
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Thursday, 26 April 12
BUKIT ASAMS 1Q OPERATING PROFIT MARGIN HAS INCREASED BY 6% TO RP. 1 TRILLION
COALspot.com - PT. Bukit Asam (Persero), the Indonesia’s state owned coal miner's 1Q, 2012 revenue has increased by 31% to Rp. 3.02 trillion ...
Thursday, 26 April 12
TAIPOWER TO BUY 1.15 MILLION TONS OF 5000 GAR COAL
COALspot.com - Taiwan Power Company intends to procure 1.125million tons of sub-bituminous coal for Taipower thermal power plant through open tender ...
Thursday, 26 April 12
TAIPOWER TO BUY 375,000 MT OF 4800 GAR COAL
COALspot.com - Taiwan Power Company intends to procure 375,000 metric tons of low sulfur sub-bituminous coal for Taipower thermal power plant ...
Thursday, 26 April 12
ADK SHIPPED 28,000 TONNES OF COAL THIS MONTH
COALspot.com - Orpheus Energy (ASX:OEG) has announced that four coal barges carrying a total of approximately 28,000 tonnes of ADK (Alam Duta K ...
Thursday, 26 April 12
DRY BULK CARRIERS RENTER FLEET AFTER IDLING, ON MARKETS RECOVERY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market seems to be back on track, not only solidifying the gains of the past couple of weeks, but also racing to new heights, recuperra ...
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- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- Holcim Trading Pte Ltd - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Marubeni Corporation - India
- Vedanta Resources Plc - India
- Uttam Galva Steels Limited - India
- Indika Energy - Indonesia
- Siam City Cement PLC, Thailand
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- GVK Power & Infra Limited - India
- Siam City Cement - Thailand
- Thiess Contractors Indonesia
- European Bulk Services B.V. - Netherlands
- Karaikal Port Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- PTC India Limited - India
- Sinarmas Energy and Mining - Indonesia
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Energy Link Ltd, New Zealand
- Sree Jayajothi Cements Limited - India
- Interocean Group of Companies - India
- Energy Development Corp, Philippines
- Rio Tinto Coal - Australia
- Aditya Birla Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- VISA Power Limited - India
- White Energy Company Limited
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Toyota Tsusho Corporation, Japan
- Sindya Power Generating Company Private Ltd
- Meralco Power Generation, Philippines
- Edison Trading Spa - Italy
- Miang Besar Coal Terminal - Indonesia
- MS Steel International - UAE
- GMR Energy Limited - India
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Africa Commodities Group - South Africa
- Bangladesh Power Developement Board
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Sidhee Cement - India
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- South Luzon Thermal Energy Corporation
- Globalindo Alam Lestari - Indonesia
- New Zealand Coal & Carbon
- The State Trading Corporation of India Ltd
- Attock Cement Pakistan Limited
- Dalmia Cement Bharat India
- Kepco SPC Power Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Borneo Indobara - Indonesia
- Planning Commission, India
- Australian Commodity Traders Exchange
- Altura Mining Limited, Indonesia
- International Coal Ventures Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jindal Steel & Power Ltd - India
- Eastern Energy - Thailand
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Baramulti Group, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- GAC Shipping (India) Pvt Ltd
- Global Green Power PLC Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Metalloyd Limited - United Kingdom
- Indonesian Coal Mining Association
- Renaissance Capital - South Africa
- Banpu Public Company Limited - Thailand
- Leighton Contractors Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- Mintek Dendrill Indonesia
- Australian Coal Association
- Ministry of Finance - Indonesia
- Orica Mining Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- The University of Queensland
- Billiton Holdings Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Transport, Egypt
- Semirara Mining Corp, Philippines
- Deloitte Consulting - India
- Price Waterhouse Coopers - Russia
- Latin American Coal - Colombia
- OPG Power Generation Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Goldman Sachs - Singapore
- Orica Australia Pty. Ltd.
- Posco Energy - South Korea
- Bhushan Steel Limited - India
- Georgia Ports Authority, United States
- Mercuria Energy - Indonesia
- Global Business Power Corporation, Philippines
- Central Electricity Authority - India
- Malabar Cements Ltd - India
- London Commodity Brokers - England
- Singapore Mercantile Exchange
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- SMG Consultants - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Petron Corporation, Philippines
- Star Paper Mills Limited - India
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- PNOC Exploration Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- Carbofer General Trading SA - India
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Romanian Commodities Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Maheswari Brothers Coal Limited - India
- Xindia Steels Limited - India
- Indogreen Group - Indonesia
- Coalindo Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Anglo American - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Sakthi Sugars Limited - India
- SN Aboitiz Power Inc, Philippines
- Makarim & Taira - Indonesia
- India Bulls Power Limited - India
- Indian Energy Exchange, India
- Wood Mackenzie - Singapore
- Power Finance Corporation Ltd., India
- Therma Luzon, Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Bhatia International Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Central Java Power - Indonesia
- Bharathi Cement Corporation - India
- Heidelberg Cement - Germany
- TeaM Sual Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Sojitz Corporation - Japan
- Iligan Light & Power Inc, Philippines
- SMC Global Power, Philippines
- Directorate Of Revenue Intelligence - India
- Merrill Lynch Commodities Europe
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Jaiprakash Power Ventures ltd
- Larsen & Toubro Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Pipit Mutiara Jaya. PT, Indonesia
- Eastern Coal Council - USA
- Chettinad Cement Corporation Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Tata Chemicals Ltd - India
- IEA Clean Coal Centre - UK
- Economic Council, Georgia
- Parry Sugars Refinery, India
- The Treasury - Australian Government
- Samtan Co., Ltd - South Korea
- Madhucon Powers Ltd - India
- Bulk Trading Sa - Switzerland
- Neyveli Lignite Corporation Ltd, - India
- Ceylon Electricity Board - Sri Lanka
- Bukit Baiduri Energy - Indonesia
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- Electricity Authority, New Zealand
- Binh Thuan Hamico - Vietnam
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Kohat Cement Company Ltd. - Pakistan
- Minerals Council of Australia
- Wilmar Investment Holdings
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Commonwealth Bank - Australia
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Mercator Lines Limited - India
- Semirara Mining and Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Standard Chartered Bank - UAE
- Coal and Oil Company - UAE
- Formosa Plastics Group - Taiwan
- Essar Steel Hazira Ltd - India
- Savvy Resources Ltd - HongKong
- Trasteel International SA, Italy
- Cigading International Bulk Terminal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Kumho Petrochemical, South Korea
- Kideco Jaya Agung - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Sarangani Energy Corporation, Philippines
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