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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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- Makarim & Taira - Indonesia
- Rio Tinto Coal - Australia
- Globalindo Alam Lestari - Indonesia
- Global Green Power PLC Corporation, Philippines
- Commonwealth Bank - Australia
- Indian Oil Corporation Limited
- Ministry of Finance - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Chettinad Cement Corporation Ltd - India
- Trasteel International SA, Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Altura Mining Limited, Indonesia
- Wood Mackenzie - Singapore
- Mercuria Energy - Indonesia
- Lanco Infratech Ltd - India
- Orica Australia Pty. Ltd.
- Ceylon Electricity Board - Sri Lanka
- Bukit Asam (Persero) Tbk - Indonesia
- Renaissance Capital - South Africa
- Bangladesh Power Developement Board
- PTC India Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Global Business Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- Billiton Holdings Pty Ltd - Australia
- CNBM International Corporation - China
- The Treasury - Australian Government
- Posco Energy - South Korea
- Therma Luzon, Inc, Philippines
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Malabar Cements Ltd - India
- VISA Power Limited - India
- Planning Commission, India
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Kalimantan Lumbung Energi - Indonesia
- Bharathi Cement Corporation - India
- Vedanta Resources Plc - India
- Interocean Group of Companies - India
- Xindia Steels Limited - India
- Iligan Light & Power Inc, Philippines
- GVK Power & Infra Limited - India
- Anglo American - United Kingdom
- IEA Clean Coal Centre - UK
- Goldman Sachs - Singapore
- Merrill Lynch Commodities Europe
- Karaikal Port Pvt Ltd - India
- White Energy Company Limited
- The State Trading Corporation of India Ltd
- Georgia Ports Authority, United States
- Eastern Energy - Thailand
- Orica Mining Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Maheswari Brothers Coal Limited - India
- Uttam Galva Steels Limited - India
- Carbofer General Trading SA - India
- Pendopo Energi Batubara - Indonesia
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Minerals Council of Australia
- Aditya Birla Group - India
- Sarangani Energy Corporation, Philippines
- Central Electricity Authority - India
- Indian Energy Exchange, India
- ICICI Bank Limited - India
- Agrawal Coal Company - India
- Singapore Mercantile Exchange
- Coastal Gujarat Power Limited - India
- Parliament of New Zealand
- Vizag Seaport Private Limited - India
- Sinarmas Energy and Mining - Indonesia
- Marubeni Corporation - India
- Ministry of Transport, Egypt
- Cigading International Bulk Terminal - Indonesia
- Cement Manufacturers Association - India
- Sojitz Corporation - Japan
- European Bulk Services B.V. - Netherlands
- Toyota Tsusho Corporation, Japan
- Siam City Cement PLC, Thailand
- McConnell Dowell - Australia
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- Manunggal Multi Energi - Indonesia
- India Bulls Power Limited - India
- Energy Development Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Salva Resources Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- IHS Mccloskey Coal Group - USA
- Leighton Contractors Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Edison Trading Spa - Italy
- Barasentosa Lestari - Indonesia
- Thai Mozambique Logistica
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Kaltim Prima Coal - Indonesia
- Dalmia Cement Bharat India
- Bhatia International Limited - India
- Meralco Power Generation, Philippines
- Electricity Authority, New Zealand
- Latin American Coal - Colombia
- Kohat Cement Company Ltd. - Pakistan
- Bulk Trading Sa - Switzerland
- Metalloyd Limited - United Kingdom
- Tamil Nadu electricity Board
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- Offshore Bulk Terminal Pte Ltd, Singapore
- GN Power Mariveles Coal Plant, Philippines
- Ind-Barath Power Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Pipit Mutiara Jaya. PT, Indonesia
- Tata Chemicals Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Sree Jayajothi Cements Limited - India
- Sindya Power Generating Company Private Ltd
- GAC Shipping (India) Pvt Ltd
- Oldendorff Carriers - Singapore
- Wilmar Investment Holdings
- Bukit Makmur.PT - Indonesia
- Coalindo Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Sakthi Sugars Limited - India
- Larsen & Toubro Limited - India
- TeaM Sual Corporation - Philippines
- London Commodity Brokers - England
- AsiaOL BioFuels Corp., Philippines
- Directorate Of Revenue Intelligence - India
- Bhushan Steel Limited - India
- ASAPP Information Group - India
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Alfred C Toepfer International GmbH - Germany
- Africa Commodities Group - South Africa
- Mintek Dendrill Indonesia
- Riau Bara Harum - Indonesia
- Electricity Generating Authority of Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indogreen Group - Indonesia
- Independent Power Producers Association of India
- Grasim Industreis Ltd - India
- Power Finance Corporation Ltd., India
- Bahari Cakrawala Sebuku - Indonesia
- Ambuja Cements Ltd - India
- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Savvy Resources Ltd - HongKong
- Baramulti Group, Indonesia
- Simpson Spence & Young - Indonesia
- SMC Global Power, Philippines
- International Coal Ventures Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Bukit Baiduri Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Indonesian Coal Mining Association
- Antam Resourcindo - Indonesia
- Meenaskhi Energy Private Limited - India
- OPG Power Generation Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- Deloitte Consulting - India
- MS Steel International - UAE
- Semirara Mining Corp, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- Aboitiz Power Corporation - Philippines
- CIMB Investment Bank - Malaysia
- Asmin Koalindo Tuhup - Indonesia
- Bhoruka Overseas - Indonesia
- Madhucon Powers Ltd - India
- Australian Coal Association
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- South Luzon Thermal Energy Corporation
- Jindal Steel & Power Ltd - India
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Petron Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- The University of Queensland
- Port Waratah Coal Services - Australia
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- PNOC Exploration Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Indika Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- SMG Consultants - Indonesia
- Coal and Oil Company - UAE
- Sical Logistics Limited - India
- Semirara Mining and Power Corporation, Philippines
- Heidelberg Cement - Germany
- Mjunction Services Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Binh Thuan Hamico - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Eastern Coal Council - USA
- GMR Energy Limited - India
- Medco Energi Mining Internasional
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kideco Jaya Agung - Indonesia
- Siam City Cement - Thailand
- Ministry of Mines - Canada
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