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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, 15 March 12
RESOURCE ALAM FY11 PROFIT UP 171% - INSIDER STORIES
Insider Stories reported that, coal mining company PT Resource Alam Indonesia Tbk (KKGI) reported a 171.16% jump in net profit last year on the back ...
Wednesday, 14 March 12
GLOBAL THERMAL TRADE FLOW CHANGES WILL ENSURE SECURITY OF THERMAL COAL SUPPLY, ALBEIT AT A HIGH PRICE - WOOD MACKENZIE
Wood Mackenzie Says Global Thermal Trade Flow Changes Will Ensure Security of Thermal Coal Supply, Albeit At a High Price Seaborne thermal demand by ...
Wednesday, 14 March 12
COKAL TAKES ANOTHER STEP IN DEVELOPING INFRASTRUCTURE TO FACILITATE METALLURGICAL COAL PRODUCTION
Global coal group, Cokal Limited (ASX-CKA), has signed Memorandums of Understanding (MoU’s) to develop two river ports and two small scale coa ...
Tuesday, 13 March 12
CLARIFICATION OF GR 24 OF 2012 REQUIRING DIVESTMENT OF FOREIGN OWNERSHIP OVER TIME
ASX Announcement
Global metallurgical coal group, Cokal Limited (ASX-CKA), is responding to the recent announcement of the Indonesian Ministry of ...
Tuesday, 13 March 12
EUROPEAN COAL CONTANGO: FURTHER STEEPNESS REQUIRED TO MAKE LARGE SCALE PHYSICAL TIME SPREAD ARBITRAGE MORE ATTRACTIVE - MISWIN MAHESH, BARCLAYS CAPITAL
COALspot.com - "With the contango between the Y+1 and M+1 ARA delivered contract now averaging above the $14/t level, there is an increasing in ...
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- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- SMC Global Power, Philippines
- Cement Manufacturers Association - India
- Ceylon Electricity Board - Sri Lanka
- Posco Energy - South Korea
- Metalloyd Limited - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- Holcim Trading Pte Ltd - Singapore
- IEA Clean Coal Centre - UK
- Chettinad Cement Corporation Ltd - India
- Meralco Power Generation, Philippines
- Sindya Power Generating Company Private Ltd
- Petrochimia International Co. Ltd.- Taiwan
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- Tamil Nadu electricity Board
- London Commodity Brokers - England
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- The State Trading Corporation of India Ltd
- Straits Asia Resources Limited - Singapore
- The Treasury - Australian Government
- Aditya Birla Group - India
- PNOC Exploration Corporation - Philippines
- Antam Resourcindo - Indonesia
- Global Green Power PLC Corporation, Philippines
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Alfred C Toepfer International GmbH - Germany
- Singapore Mercantile Exchange
- Vizag Seaport Private Limited - India
- GMR Energy Limited - India
- Gujarat Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- Star Paper Mills Limited - India
- South Luzon Thermal Energy Corporation
- Gujarat Sidhee Cement - India
- Indogreen Group - Indonesia
- Bhatia International Limited - India
- OPG Power Generation Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- Wood Mackenzie - Singapore
- Bhushan Steel Limited - India
- Larsen & Toubro Limited - India
- Commonwealth Bank - Australia
- Power Finance Corporation Ltd., India
- Uttam Galva Steels Limited - India
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Baiduri Energy - Indonesia
- Sojitz Corporation - Japan
- Economic Council, Georgia
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Chamber of Mines of South Africa
- MS Steel International - UAE
- Maheswari Brothers Coal Limited - India
- Semirara Mining Corp, Philippines
- Dalmia Cement Bharat India
- Pipit Mutiara Jaya. PT, Indonesia
- Globalindo Alam Lestari - Indonesia
- McConnell Dowell - Australia
- Samtan Co., Ltd - South Korea
- Minerals Council of Australia
- Trasteel International SA, Italy
- Toyota Tsusho Corporation, Japan
- GN Power Mariveles Coal Plant, Philippines
- Karbindo Abesyapradhi - Indoneisa
- TeaM Sual Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- PTC India Limited - India
- Deloitte Consulting - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Ministry of Finance - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- Indian Oil Corporation Limited
- Simpson Spence & Young - Indonesia
- Energy Development Corp, Philippines
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- GAC Shipping (India) Pvt Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Wilmar Investment Holdings
- Madhucon Powers Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Thiess Contractors Indonesia
- Indo Tambangraya Megah - Indonesia
- Petron Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Interocean Group of Companies - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Bharathi Cement Corporation - India
- Romanian Commodities Exchange
- Jindal Steel & Power Ltd - India
- Edison Trading Spa - Italy
- Kapuas Tunggal Persada - Indonesia
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- CIMB Investment Bank - Malaysia
- Mercator Lines Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Electricity Authority, New Zealand
- Altura Mining Limited, Indonesia
- Standard Chartered Bank - UAE
- Port Waratah Coal Services - Australia
- Latin American Coal - Colombia
- Kideco Jaya Agung - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Karaikal Port Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Price Waterhouse Coopers - Russia
- Central Electricity Authority - India
- IHS Mccloskey Coal Group - USA
- Miang Besar Coal Terminal - Indonesia
- Kumho Petrochemical, South Korea
- Bukit Makmur.PT - Indonesia
- Jaiprakash Power Ventures ltd
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Borneo Indobara - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Coalindo Energy - Indonesia
- The University of Queensland
- Medco Energi Mining Internasional
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Indonesian Coal Mining Association
- Parry Sugars Refinery, India
- Baramulti Group, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Eastern Energy - Thailand
- Barasentosa Lestari - Indonesia
- Planning Commission, India
- Independent Power Producers Association of India
- Xindia Steels Limited - India
- Renaissance Capital - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- Aboitiz Power Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Anglo American - United Kingdom
- Sical Logistics Limited - India
- Rio Tinto Coal - Australia
- Rashtriya Ispat Nigam Limited - India
- Thai Mozambique Logistica
- Savvy Resources Ltd - HongKong
- Bulk Trading Sa - Switzerland
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- White Energy Company Limited
- Riau Bara Harum - Indonesia
- Vedanta Resources Plc - India
- ICICI Bank Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coastal Gujarat Power Limited - India
- Energy Link Ltd, New Zealand
- Banpu Public Company Limited - Thailand
- Kalimantan Lumbung Energi - Indonesia
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Meenaskhi Energy Private Limited - India
- Sakthi Sugars Limited - India
- CNBM International Corporation - China
- Oldendorff Carriers - Singapore
- SN Aboitiz Power Inc, Philippines
- Goldman Sachs - Singapore
- Siam City Cement PLC, Thailand
- Makarim & Taira - Indonesia
- Coal and Oil Company - UAE
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- SMG Consultants - Indonesia
- Attock Cement Pakistan Limited
- Ambuja Cements Ltd - India
- Heidelberg Cement - Germany
- Mercuria Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Australian Coal Association
- Jorong Barutama Greston.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- Sree Jayajothi Cements Limited - India
- Kartika Selabumi Mining - Indonesia
- Salva Resources Pvt Ltd - India
- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- Africa Commodities Group - South Africa
- Central Java Power - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- VISA Power Limited - India
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