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Wednesday, 07 March 12
DRY BULK MARKET KEEPS UP TIMID REBOUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The dry bulk market has kept its rising momentum yesterday, rising for the eighth straight session, on the back of renewed demand for smaller bulk carriers. As a result, the BDI (Baltic Dry Index), the industry’s benchmark, ended yesterday up by 0.64% to 787 points. Indeed, it was the smaller ship types which kept the market upwards yesterday, versus their larger counterparts which seemed to suffer from thinner demand. The Handysize segment rose by 1.36% according to the Baltic Exchange, while the Supramax one was the main gainer, with a daily increase of 2.6%. by contrast, the Capesize market was down by 0.46% to 1,516 points, while Panamaxes were also trading lower by 0.23% to 852 points.
Still, things are far from well, given the recent emergence of another negative catalyst factor for the future growth of freight rates, especially in the Capesize markets. More specifically, according to the China Iron Ore & Steel Association (CISA), China is aiming to improve its self efficiency in iron ore and continue to consolidate the steel industry in a bid to raise the output of its major steel makers by 10% within the next four years. The government expects the country’s top 10 steel manufacturers to account for 60% of the country’s steel output by 2015, Wang Xiaoqi, CISA vice chairman, said at a recent trade conference held in Beijing.
Meanwhile, according to BIMCO, dry bulk rates are set to remain suppressed during the next few weeks. Capesize Time Charter Average will remain under pressure and stay below $12,000 per day as tonnage oversupply has hit back at a time where demand is taking a small breather. Meanwhile, the report also forecasted that Panamax and Supramax freight rates are likely to develop rather flat and stay in the USD 7,000-13,000 per day interval. Handysize rates are expected to remain close to the operating break-even freight rate level at USD 6,000-8,000 per day interval.
According to BIMCO, “opportunities in the time charter market are gone for now and only the spot market remains in focus. As demand has dozed off, there is a return of pressure from the tonnage oversupply that must go away before rates will be supported by returning demand. Provided that iron ore spot prices will stay competitive/attractive as compared to the domestically mined ore within China, this should support demand, regardless of the level of stockpiles at Chinese ports and a stagnating steel price. But the lift will come in weeks rather than days.
One of the main events during 2012 will be the 19 Vale-connected +400,000 DWT VLOCs that are due for delivery. They come on top of the 5 VLOCs delivered in 2011 and another 125 new Capesize vessels that are going to be delivered in 2012. The “low” level of new Capesize deliveries comes after two mammoth years where 213 (2010) and 248 (2011) were launched and the easing inflow could be further potentially buoyed by another 60 Capesizes being demolished, assuming the 2011-standards for scrap-matured vessels are applied. Even with the extensive focus the VLOC’s have received, in the context of the sheer amount of VLOC-tonnage as a share of the total Capesize fleet, 5% remains minor.
The only seasonal factor that could support rates during the first quarter is thermal coal for heating in the northern hemisphere winter, including China. But pulling in the opposite direction is the structural overcapacity and the seasonal winter rains in Brazil and South Africa and cyclones on the west coast of Australia that delivered a significant blow to freight rates last January as massive amounts of cargo were cut off” said BIMCO in its analysis.
The organization’s Chief Shipping Analyst, Peter Sand also mentioned, that in terms of supply, «the biggest positive surprise of 2011 was the 22.2 million DWT of demolished tonnage. Of this, 67 were Capesize vessels sold for recycling primarily during the terrible first six months. Characteristics of the average Capesize vessel that left the fleet: 156,845 DWT, 27 years of age, recycled in Bangladesh at USD 509 per Ldt., leaving USD 11.5 million for the owner from taking the vessel out of active trading.
During 2011, an average of 8 million DWT was delivered into the market every single month. This was an unprecedentedly high number – something we hopefully won’t see again before the fleet is twice as big as today in 2034. If January deliveries are to give any indication into 2012, a level of little more than 6 million is relatively positive, as the pace is coming down from 2010-11. However, it’s still a historically very high level.
So far, the active fleet has grown by 1.0% in 2012, caused by delivery of 79 new vessels of 6.4 million DWT, offset by 1.6 million DWT being demolished. BIMCO expects total demolition in 2012 to come down from the 22.1 million DWT that was demolished during 2011 but to stay high, as freight rates are bound to keep pressure on earnings, pushing more over-aged tonnage over the edge. Total inflow of tonnage in 2012 is estimated to hit 78 million DWT, counterbalanced by higher than previously expected demolition of 19 million DWT.
Following the upward adjustment of the demolition potential the dry bulk fleet holds for 2012, the fleet is now set to grow a bit slower at 10% during 2012. As 2011 only saw 26 million DWT being contracted, which was the lowest level since 2002, BIMCO expects 2012 to provide more of the same on that front. Overcapacity bites – and whatever cash reserves are left from before the financial crisis broke in 2008 or leftovers from the surprisingly well 2010 is not expected to be spent on new build first installments. Not even the elevated Capesize earnings that we experienced during the 4th quarter of 2011 made owners call the shipyards to place new orders” stated Sand in his analysis.
Source: Nikos Roussanoglou, Hellenic Shipping
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Friday, 04 May 12
DEMOLITION KEY FOR DRY BULK MARKET RECOVERY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The overflow of newbuilding vessels which “spilled over” into 2012 from 2011 brought the dry bulk market to a near collapse level at the ...
Thursday, 03 May 12
DRY BULK MARKET REMAINS INACTIVE, POSTING MILD DECREASE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept retreating this week, although at a very low pace, on the back of a lull in demand. The industry's benchmark, th ...
Thursday, 03 May 12
MINERS DEMAND LEGAL CERTAINTY ON PRE-BAN INTERIM POLICY - THE JAKARTA POST
The Jakarta Post reported that, Mining companies represented by the Indonesian Mining Association (IMA) welcomed the government’s plan to impo ...
Thursday, 03 May 12
HANDY EAST COAST INDIA - CHINA AROUND USD 7000 - FEARNLEYS AS
Handy - Stable demand in the Atlantic offered good rates for the tonnage.
USG/Cont was worth USD 17500 and more. Baltic and Black Sea appeared to ...
Wednesday, 02 May 12
CHINA BLACKOUTS HIGHLIGHT PRICING POLICY WEAKNESS - FITCH
Fitch reported that, the likelihood of further electricity blackouts in China this summer underlines Fitch's view of the basic problem f ...
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- Minerals Council of Australia
- GVK Power & Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- GAC Shipping (India) Pvt Ltd
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Rio Tinto Coal - Australia
- Jorong Barutama Greston.PT - Indonesia
- Essar Steel Hazira Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- India Bulls Power Limited - India
- Indika Energy - Indonesia
- Madhucon Powers Ltd - India
- Planning Commission, India
- Pipit Mutiara Jaya. PT, Indonesia
- Ambuja Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Sree Jayajothi Cements Limited - India
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Australian Coal Association
- Electricity Authority, New Zealand
- Bharathi Cement Corporation - India
- PNOC Exploration Corporation - Philippines
- Vizag Seaport Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Global Coal Blending Company Limited - Australia
- Interocean Group of Companies - India
- Latin American Coal - Colombia
- Uttam Galva Steels Limited - India
- Global Business Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- The University of Queensland
- Eastern Coal Council - USA
- Gujarat Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Straits Asia Resources Limited - Singapore
- LBH Netherlands Bv - Netherlands
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- Energy Development Corp, Philippines
- Dalmia Cement Bharat India
- Bukit Makmur.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- Gujarat Sidhee Cement - India
- Goldman Sachs - Singapore
- Trasteel International SA, Italy
- Mjunction Services Limited - India
- Rashtriya Ispat Nigam Limited - India
- SMC Global Power, Philippines
- Riau Bara Harum - Indonesia
- London Commodity Brokers - England
- Aditya Birla Group - India
- TeaM Sual Corporation - Philippines
- Altura Mining Limited, Indonesia
- Kumho Petrochemical, South Korea
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indian Energy Exchange, India
- ICICI Bank Limited - India
- Semirara Mining and Power Corporation, Philippines
- Heidelberg Cement - Germany
- White Energy Company Limited
- Holcim Trading Pte Ltd - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- Port Waratah Coal Services - Australia
- OPG Power Generation Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Thiess Contractors Indonesia
- Merrill Lynch Commodities Europe
- South Luzon Thermal Energy Corporation
- Mercuria Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Coastal Gujarat Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- New Zealand Coal & Carbon
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- Sarangani Energy Corporation, Philippines
- Xindia Steels Limited - India
- Sakthi Sugars Limited - India
- Energy Link Ltd, New Zealand
- Toyota Tsusho Corporation, Japan
- Borneo Indobara - Indonesia
- Renaissance Capital - South Africa
- Deloitte Consulting - India
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Oldendorff Carriers - Singapore
- Bulk Trading Sa - Switzerland
- Chettinad Cement Corporation Ltd - India
- Coal and Oil Company - UAE
- Karbindo Abesyapradhi - Indoneisa
- Bukit Baiduri Energy - Indonesia
- PowerSource Philippines DevCo
- The Treasury - Australian Government
- Jindal Steel & Power Ltd - India
- CNBM International Corporation - China
- Makarim & Taira - Indonesia
- Agrawal Coal Company - India
- AsiaOL BioFuels Corp., Philippines
- ASAPP Information Group - India
- Price Waterhouse Coopers - Russia
- Kobexindo Tractors - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Independent Power Producers Association of India
- Savvy Resources Ltd - HongKong
- Cigading International Bulk Terminal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Star Paper Mills Limited - India
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- Indo Tambangraya Megah - Indonesia
- Bhatia International Limited - India
- The State Trading Corporation of India Ltd
- Tamil Nadu electricity Board
- Simpson Spence & Young - Indonesia
- Thai Mozambique Logistica
- PTC India Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Lanco Infratech Ltd - India
- Ministry of Finance - Indonesia
- Posco Energy - South Korea
- Parliament of New Zealand
- VISA Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Miang Besar Coal Terminal - Indonesia
- Attock Cement Pakistan Limited
- Mintek Dendrill Indonesia
- Kaltim Prima Coal - Indonesia
- IHS Mccloskey Coal Group - USA
- Georgia Ports Authority, United States
- Baramulti Group, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Commonwealth Bank - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- Kepco SPC Power Corporation, Philippines
- Sojitz Corporation - Japan
- Power Finance Corporation Ltd., India
- Barasentosa Lestari - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- Vijayanagar Sugar Pvt Ltd - India
- Central Java Power - Indonesia
- Sical Logistics Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Malabar Cements Ltd - India
- GMR Energy Limited - India
- Petron Corporation, Philippines
- Videocon Industries ltd - India
- International Coal Ventures Pvt Ltd - India
- Indogreen Group - Indonesia
- Kartika Selabumi Mining - Indonesia
- Orica Mining Services - Indonesia
- Singapore Mercantile Exchange
- Asmin Koalindo Tuhup - Indonesia
- MS Steel International - UAE
- Kalimantan Lumbung Energi - Indonesia
- Grasim Industreis Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Africa Commodities Group - South Africa
- Directorate Of Revenue Intelligence - India
- Semirara Mining Corp, Philippines
- Mercator Lines Limited - India
- Karaikal Port Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- Edison Trading Spa - Italy
- Tata Chemicals Ltd - India
- Aboitiz Power Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- SMG Consultants - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- McConnell Dowell - Australia
- Banpu Public Company Limited - Thailand
- Globalindo Alam Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bhushan Steel Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Global Green Power PLC Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Maheswari Brothers Coal Limited - India
- Carbofer General Trading SA - India
- Anglo American - United Kingdom
- Bayan Resources Tbk. - Indonesia
- Bhoruka Overseas - Indonesia
- Sindya Power Generating Company Private Ltd
- Standard Chartered Bank - UAE
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
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