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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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Thursday, 22 March 12
ECI-CHINA HANDY RATES ARE AROUND US$ 8000 - FEARNLEYS
Handy
Another positive trend was seen last week with more cargoes entering the market. Skaw-Passero/US Gulf climbed slowly up to USD 3700, while US ...
Thursday, 22 March 12
DRY BULK MARKET KEEPS SURGING, CAPESIZES FALLING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what seems to be an establishing pattern, the dry bulk market has kept its upward momentum, edging closer to the 900 point-mark, but the larger s ...
Wednesday, 21 March 12
BUMA HAS PRODUCED 2.3 MILLION TONS OF COAL IN FEBRUARY 2012
COALspot.com - PT. Delta Dunia Makmur's overburden removal in February 2012 has reached totaled 23.8 million bcm (+2.4% YoY) while coal production ...
Tuesday, 20 March 12
SMALLER DRY BULK VESSELS STILL LEADING DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been growing during the past couple of weeks, but contrary to the usual practice, it’s not the larger Capesizes which ...
Monday, 19 March 12
WEEKLY DRY MARKET OVERVIEW: SMALLER VESSELS LEAD RATES HIGHER - MARIA BERTZELETOU, HELLENIC SHIPPING
The upward trend of the Baltic Dry Index persists strong from the end of February, spurred from the supramax market that offsets the weakness in the ...
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- Indika Energy - Indonesia
- Electricity Generating Authority of Thailand
- Gujarat Sidhee Cement - India
- Global Green Power PLC Corporation, Philippines
- ASAPP Information Group - India
- IEA Clean Coal Centre - UK
- Billiton Holdings Pty Ltd - Australia
- The University of Queensland
- GMR Energy Limited - India
- Minerals Council of Australia
- Maharashtra Electricity Regulatory Commission - India
- Posco Energy - South Korea
- Orica Mining Services - Indonesia
- Edison Trading Spa - Italy
- Indian Energy Exchange, India
- Banpu Public Company Limited - Thailand
- Makarim & Taira - Indonesia
- Indo Tambangraya Megah - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Cement Manufacturers Association - India
- PTC India Limited - India
- PNOC Exploration Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Goldman Sachs - Singapore
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Sarangani Energy Corporation, Philippines
- Mercator Lines Limited - India
- Power Finance Corporation Ltd., India
- Electricity Authority, New Zealand
- Aditya Birla Group - India
- Directorate General of MIneral and Coal - Indonesia
- San Jose City I Power Corp, Philippines
- The State Trading Corporation of India Ltd
- Medco Energi Mining Internasional
- Price Waterhouse Coopers - Russia
- Mercuria Energy - Indonesia
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Borneo Indobara - Indonesia
- SMC Global Power, Philippines
- Uttam Galva Steels Limited - India
- Indogreen Group - Indonesia
- London Commodity Brokers - England
- VISA Power Limited - India
- CNBM International Corporation - China
- Ind-Barath Power Infra Limited - India
- Xindia Steels Limited - India
- Videocon Industries ltd - India
- Antam Resourcindo - Indonesia
- Grasim Industreis Ltd - India
- Planning Commission, India
- Essar Steel Hazira Ltd - India
- Central Electricity Authority - India
- Kepco SPC Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Meralco Power Generation, Philippines
- Globalindo Alam Lestari - Indonesia
- Bhushan Steel Limited - India
- Kumho Petrochemical, South Korea
- Jindal Steel & Power Ltd - India
- Bhatia International Limited - India
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Mintek Dendrill Indonesia
- Manunggal Multi Energi - Indonesia
- Lanco Infratech Ltd - India
- Simpson Spence & Young - Indonesia
- Marubeni Corporation - India
- TeaM Sual Corporation - Philippines
- Agrawal Coal Company - India
- Bulk Trading Sa - Switzerland
- Gujarat Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- Mjunction Services Limited - India
- Semirara Mining and Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Global Business Power Corporation, Philippines
- Bangladesh Power Developement Board
- Independent Power Producers Association of India
- Africa Commodities Group - South Africa
- Ministry of Finance - Indonesia
- Intertek Mineral Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Pendopo Energi Batubara - Indonesia
- Vizag Seaport Private Limited - India
- Romanian Commodities Exchange
- Malabar Cements Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- Bhoruka Overseas - Indonesia
- Eastern Coal Council - USA
- Alfred C Toepfer International GmbH - Germany
- Star Paper Mills Limited - India
- White Energy Company Limited
- Karaikal Port Pvt Ltd - India
- Ambuja Cements Ltd - India
- Ministry of Transport, Egypt
- Cigading International Bulk Terminal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Rio Tinto Coal - Australia
- Kohat Cement Company Ltd. - Pakistan
- Petrochimia International Co. Ltd.- Taiwan
- Indian Oil Corporation Limited
- Chettinad Cement Corporation Ltd - India
- Eastern Energy - Thailand
- Sical Logistics Limited - India
- Salva Resources Pvt Ltd - India
- Heidelberg Cement - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- European Bulk Services B.V. - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- New Zealand Coal & Carbon
- Anglo American - United Kingdom
- Directorate Of Revenue Intelligence - India
- Miang Besar Coal Terminal - Indonesia
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Latin American Coal - Colombia
- Larsen & Toubro Limited - India
- OPG Power Generation Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- Renaissance Capital - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Kideco Jaya Agung - Indonesia
- Kobexindo Tractors - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Metalloyd Limited - United Kingdom
- Energy Development Corp, Philippines
- Samtan Co., Ltd - South Korea
- International Coal Ventures Pvt Ltd - India
- McConnell Dowell - Australia
- Kaltim Prima Coal - Indonesia
- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
- Deloitte Consulting - India
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Energy Link Ltd, New Zealand
- Oldendorff Carriers - Singapore
- Timah Investasi Mineral - Indoneisa
- Thai Mozambique Logistica
- Commonwealth Bank - Australia
- Altura Mining Limited, Indonesia
- AsiaOL BioFuels Corp., Philippines
- Attock Cement Pakistan Limited
- Indonesian Coal Mining Association
- Semirara Mining Corp, Philippines
- ICICI Bank Limited - India
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Wood Mackenzie - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- Therma Luzon, Inc, Philippines
- Jaiprakash Power Ventures ltd
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- LBH Netherlands Bv - Netherlands
- Standard Chartered Bank - UAE
- Sinarmas Energy and Mining - Indonesia
- Australian Coal Association
- CIMB Investment Bank - Malaysia
- Baramulti Group, Indonesia
- Riau Bara Harum - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Thiess Contractors Indonesia
- Interocean Group of Companies - India
- Coal and Oil Company - UAE
- Ministry of Mines - Canada
- Bukit Asam (Persero) Tbk - Indonesia
- Tata Chemicals Ltd - India
- Australian Commodity Traders Exchange
- IHS Mccloskey Coal Group - USA
- TNB Fuel Sdn Bhd - Malaysia
- GN Power Mariveles Coal Plant, Philippines
- Kapuas Tunggal Persada - Indonesia
- Central Java Power - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Tamil Nadu electricity Board
- The Treasury - Australian Government
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- Parry Sugars Refinery, India
- Meenaskhi Energy Private Limited - India
- Wilmar Investment Holdings
- Economic Council, Georgia
- Krishnapatnam Port Company Ltd. - India
- Singapore Mercantile Exchange
- Dalmia Cement Bharat India
- Barasentosa Lestari - Indonesia
- Vedanta Resources Plc - India
- Madhucon Powers Ltd - India
- Bukit Makmur.PT - Indonesia
- Savvy Resources Ltd - HongKong
- Bank of Tokyo Mitsubishi UFJ Ltd
- South Luzon Thermal Energy Corporation
- SN Aboitiz Power Inc, Philippines
- SMG Consultants - Indonesia
- Coalindo Energy - Indonesia
- Siam City Cement - Thailand
- Iligan Light & Power Inc, Philippines
- Chamber of Mines of South Africa
- Sree Jayajothi Cements Limited - India
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