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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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Saturday, 04 February 12
SUPRAMAX DELIVERY SOUTH CHINA FOR TRIPS VIA INDONESIA WERE REPORTED AROUND $ 6,000 PER DAY - VISTAAR
COALspot.com - The markets continued to soften which dropped by almost 11 pct and BDI closing at 647 points.
The drop in BDI was mainly due to dr ...
Thursday, 02 February 12
NO RELIEF YET FOR DRY BULK SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Although at the start of 2012 nobody can claim that the global seaborne trade has suddenly come to a halt, quite the contrary, it seems that the dry ...
Wednesday, 01 February 12
KRISHNAPATNAM PORT - GOING DEEP TO SOAR HIGH
COALspot.com - Krishnapatnam Port now rightfully claims as the deepest draft port in India, as it has started accepting vessels with maximum permiss ...
Wednesday, 01 February 12
IN JAMBI, MOST MINING COMPANIES LACK 'CLEAR-AND-CLEAN' PERMITS - JP
More than three-quarters of the 386 mining companies in Jambi lack “clear-and-clean” certifications from the government, according to an ...
Wednesday, 01 February 12
2% OF IBPS TOTAL CONCESSION AREA CONTAINS TOTAL COAL RESOURCE OF 56.1 MILLION TON
COALspot.com - PT. Britmindo, a mine consulting firm, has finalized PT. Insani Bara Perkasa (IBP) first JORC (Joint Ore Reserves Committee) res ...
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- GMR Energy Limited - India
- Energy Development Corp, Philippines
- Eastern Coal Council - USA
- Aboitiz Power Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- MS Steel International - UAE
- Kideco Jaya Agung - Indonesia
- Thai Mozambique Logistica
- Makarim & Taira - Indonesia
- Chamber of Mines of South Africa
- Minerals Council of Australia
- Bulk Trading Sa - Switzerland
- Bangladesh Power Developement Board
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- Central Electricity Authority - India
- Bukit Baiduri Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Romanian Commodities Exchange
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Carbofer General Trading SA - India
- Salva Resources Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Orica Australia Pty. Ltd.
- Coalindo Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Vizag Seaport Private Limited - India
- PNOC Exploration Corporation - Philippines
- Oldendorff Carriers - Singapore
- Standard Chartered Bank - UAE
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- Larsen & Toubro Limited - India
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- Maheswari Brothers Coal Limited - India
- Interocean Group of Companies - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement - Thailand
- SN Aboitiz Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Electricity Authority, New Zealand
- Cigading International Bulk Terminal - Indonesia
- Agrawal Coal Company - India
- TeaM Sual Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Australian Commodity Traders Exchange
- Sinarmas Energy and Mining - Indonesia
- Metalloyd Limited - United Kingdom
- ICICI Bank Limited - India
- Toyota Tsusho Corporation, Japan
- Leighton Contractors Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Wood Mackenzie - Singapore
- Pendopo Energi Batubara - Indonesia
- Latin American Coal - Colombia
- International Coal Ventures Pvt Ltd - India
- London Commodity Brokers - England
- Karbindo Abesyapradhi - Indoneisa
- Essar Steel Hazira Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Bayan Resources Tbk. - Indonesia
- Xindia Steels Limited - India
- Iligan Light & Power Inc, Philippines
- Sical Logistics Limited - India
- Jaiprakash Power Ventures ltd
- Timah Investasi Mineral - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- PTC India Limited - India
- Attock Cement Pakistan Limited
- Star Paper Mills Limited - India
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Petron Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Kaltim Prima Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Renaissance Capital - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Georgia Ports Authority, United States
- Posco Energy - South Korea
- Indika Energy - Indonesia
- Wilmar Investment Holdings
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Medco Energi Mining Internasional
- The State Trading Corporation of India Ltd
- Eastern Energy - Thailand
- VISA Power Limited - India
- Intertek Mineral Services - Indonesia
- Indian Energy Exchange, India
- Orica Mining Services - Indonesia
- Africa Commodities Group - South Africa
- Parliament of New Zealand
- Krishnapatnam Port Company Ltd. - India
- McConnell Dowell - Australia
- Kepco SPC Power Corporation, Philippines
- Planning Commission, India
- Bhushan Steel Limited - India
- Global Green Power PLC Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Bhoruka Overseas - Indonesia
- PowerSource Philippines DevCo
- Anglo American - United Kingdom
- Uttam Galva Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Vedanta Resources Plc - India
- Australian Coal Association
- Madhucon Powers Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- India Bulls Power Limited - India
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- OPG Power Generation Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- IEA Clean Coal Centre - UK
- Dalmia Cement Bharat India
- CNBM International Corporation - China
- Goldman Sachs - Singapore
- Singapore Mercantile Exchange
- SMG Consultants - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Neyveli Lignite Corporation Ltd, - India
- TNB Fuel Sdn Bhd - Malaysia
- Semirara Mining and Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Port Waratah Coal Services - Australia
- White Energy Company Limited
- Energy Link Ltd, New Zealand
- South Luzon Thermal Energy Corporation
- Indian Oil Corporation Limited
- Price Waterhouse Coopers - Russia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- Marubeni Corporation - India
- GAC Shipping (India) Pvt Ltd
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bharathi Cement Corporation - India
- Grasim Industreis Ltd - India
- Gujarat Sidhee Cement - India
- Kumho Petrochemical, South Korea
- New Zealand Coal & Carbon
- Savvy Resources Ltd - HongKong
- Rashtriya Ispat Nigam Limited - India
- Kartika Selabumi Mining - Indonesia
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Banpu Public Company Limited - Thailand
- Merrill Lynch Commodities Europe
- Asmin Koalindo Tuhup - Indonesia
- SMC Global Power, Philippines
- Central Java Power - Indonesia
- Borneo Indobara - Indonesia
- Global Coal Blending Company Limited - Australia
- Tamil Nadu electricity Board
- Semirara Mining Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- Malabar Cements Ltd - India
- The University of Queensland
- Heidelberg Cement - Germany
- Therma Luzon, Inc, Philippines
- Mintek Dendrill Indonesia
- AsiaOL BioFuels Corp., Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Ambuja Cements Ltd - India
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Karaikal Port Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Simpson Spence & Young - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Formosa Plastics Group - Taiwan
- Indonesian Coal Mining Association
- Barasentosa Lestari - Indonesia
- ASAPP Information Group - India
- Ministry of Transport, Egypt
- PetroVietnam Power Coal Import and Supply Company
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Deloitte Consulting - India
- Sree Jayajothi Cements Limited - India
- Commonwealth Bank - Australia
- Coastal Gujarat Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- Sakthi Sugars Limited - India
- Videocon Industries ltd - India
- Independent Power Producers Association of India
- Edison Trading Spa - Italy
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- GVK Power & Infra Limited - India
- Jindal Steel & Power Ltd - India
- Bukit Makmur.PT - Indonesia
- Tata Chemicals Ltd - India
- IHS Mccloskey Coal Group - USA
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