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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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Friday, 06 April 12
DRY BULK MARKET SWIFT TO HALT FALL ON RENEWED DEMAND FOR CAPESIZES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk managed to put a stop to the recent falls, which came as a result of a lacklustre demand for smaller vessel sizes. Although this trend ...
Thursday, 05 April 12
COAL EXPORT TAX: MATTER OF CONCERN FOR INDIA - SUNIL K KUMBHAT
COALspot.com - Since the issuance of Indonesian Mining law in 2009, miners have increased their activities in exploring , ex ...
Thursday, 05 April 12
AKR COAL FIRST EXPORT SHIPMENT OF COAL SEABORNE
PT Anugrah Karya Raya (AKR Coal) subsidiary of PT AKR Corporindo Tbk., Indonesia’s leading integrated supply chain solutions provider and larg ...
Thursday, 05 April 12
DRY BULK MARKET STALLS AS TREND IS REVERSED - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has halted its month-long rally, with the BDI (Baltic Dry Index) retreating yesterday for a second consecutive session. Industry ...
Wednesday, 04 April 12
OIL MAY JUMP TO $150PB IF IRAN ATTACKED: EXPERT - KUNA / HELLENIC SHIPPING
Prices of oil will not drop below level of $100 per barrel and may jump to $150 pb in the coming two months, according to the prominent Kuwaiti expe ...
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- The University of Queensland
- Baramulti Group, Indonesia
- Orica Australia Pty. Ltd.
- Xindia Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- Port Waratah Coal Services - Australia
- Oldendorff Carriers - Singapore
- Central Java Power - Indonesia
- Georgia Ports Authority, United States
- VISA Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Toyota Tsusho Corporation, Japan
- Singapore Mercantile Exchange
- Parry Sugars Refinery, India
- Electricity Generating Authority of Thailand
- Formosa Plastics Group - Taiwan
- Commonwealth Bank - Australia
- Ministry of Mines - Canada
- Sarangani Energy Corporation, Philippines
- Wilmar Investment Holdings
- Coal and Oil Company - UAE
- Indian Energy Exchange, India
- Alfred C Toepfer International GmbH - Germany
- AsiaOL BioFuels Corp., Philippines
- Simpson Spence & Young - Indonesia
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Salva Resources Pvt Ltd - India
- White Energy Company Limited
- Coalindo Energy - Indonesia
- MS Steel International - UAE
- Electricity Authority, New Zealand
- GVK Power & Infra Limited - India
- Anglo American - United Kingdom
- Altura Mining Limited, Indonesia
- Thiess Contractors Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thai Mozambique Logistica
- Pendopo Energi Batubara - Indonesia
- Mercuria Energy - Indonesia
- Australian Commodity Traders Exchange
- Jorong Barutama Greston.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- Trasteel International SA, Italy
- Heidelberg Cement - Germany
- PTC India Limited - India
- Vizag Seaport Private Limited - India
- Sical Logistics Limited - India
- Miang Besar Coal Terminal - Indonesia
- Marubeni Corporation - India
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Goldman Sachs - Singapore
- Globalindo Alam Lestari - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Sakthi Sugars Limited - India
- Coastal Gujarat Power Limited - India
- Lanco Infratech Ltd - India
- Price Waterhouse Coopers - Russia
- Posco Energy - South Korea
- Ceylon Electricity Board - Sri Lanka
- Romanian Commodities Exchange
- Mercator Lines Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Petrochimia International Co. Ltd.- Taiwan
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Directorate Of Revenue Intelligence - India
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- Siam City Cement PLC, Thailand
- GAC Shipping (India) Pvt Ltd
- Barasentosa Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Krishnapatnam Port Company Ltd. - India
- Siam City Cement - Thailand
- Bayan Resources Tbk. - Indonesia
- Essar Steel Hazira Ltd - India
- Australian Coal Association
- Kobexindo Tractors - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Bhatia International Limited - India
- Madhucon Powers Ltd - India
- Therma Luzon, Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- IEA Clean Coal Centre - UK
- Tamil Nadu electricity Board
- Antam Resourcindo - Indonesia
- Petron Corporation, Philippines
- Parliament of New Zealand
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Interocean Group of Companies - India
- Ministry of Finance - Indonesia
- Borneo Indobara - Indonesia
- IHS Mccloskey Coal Group - USA
- Jaiprakash Power Ventures ltd
- Latin American Coal - Colombia
- PetroVietnam Power Coal Import and Supply Company
- Chamber of Mines of South Africa
- Vedanta Resources Plc - India
- Minerals Council of Australia
- Eastern Energy - Thailand
- Star Paper Mills Limited - India
- Edison Trading Spa - Italy
- Gujarat Sidhee Cement - India
- Maheswari Brothers Coal Limited - India
- Rio Tinto Coal - Australia
- Bharathi Cement Corporation - India
- Meralco Power Generation, Philippines
- Ministry of Transport, Egypt
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Indogreen Group - Indonesia
- Independent Power Producers Association of India
- Kepco SPC Power Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- Ind-Barath Power Infra Limited - India
- ICICI Bank Limited - India
- Rashtriya Ispat Nigam Limited - India
- Indonesian Coal Mining Association
- Mjunction Services Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Indian Oil Corporation Limited
- Aditya Birla Group - India
- McConnell Dowell - Australia
- Meenaskhi Energy Private Limited - India
- Global Coal Blending Company Limited - Australia
- Timah Investasi Mineral - Indoneisa
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- SN Aboitiz Power Inc, Philippines
- Bangladesh Power Developement Board
- Semirara Mining and Power Corporation, Philippines
- Sojitz Corporation - Japan
- Ambuja Cements Ltd - India
- Kartika Selabumi Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Economic Council, Georgia
- San Jose City I Power Corp, Philippines
- Semirara Mining Corp, Philippines
- India Bulls Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- The Treasury - Australian Government
- New Zealand Coal & Carbon
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Renaissance Capital - South Africa
- Cement Manufacturers Association - India
- Sindya Power Generating Company Private Ltd
- Iligan Light & Power Inc, Philippines
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Karaikal Port Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- Samtan Co., Ltd - South Korea
- Mintek Dendrill Indonesia
- Central Electricity Authority - India
- TNB Fuel Sdn Bhd - Malaysia
- GMR Energy Limited - India
- Banpu Public Company Limited - Thailand
- Aboitiz Power Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Power Finance Corporation Ltd., India
- International Coal Ventures Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- OPG Power Generation Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Sree Jayajothi Cements Limited - India
- Wood Mackenzie - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Bulk Trading Sa - Switzerland
- Dalmia Cement Bharat India
- Grasim Industreis Ltd - India
- TeaM Sual Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- Kalimantan Lumbung Energi - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Metalloyd Limited - United Kingdom
- Agrawal Coal Company - India
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- Kumho Petrochemical, South Korea
- Energy Link Ltd, New Zealand
- Gujarat Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Merrill Lynch Commodities Europe
- Carbofer General Trading SA - India
- Malabar Cements Ltd - India
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- LBH Netherlands Bv - Netherlands
- Global Business Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Tata Chemicals Ltd - India
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