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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, 08 December 11
HAREDA KRIDA GETS CONTRACT FROM BAYAN - INSIDER STORIES
Insider Stories reported that, coal miner PT Bayan Resources Tbk (BYAN), through its subsidiary dubbed PT Gunungbayan Pratamacoal (GPB), has signed ...
Thursday, 08 December 11
CAPESIZES LIFT DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Capesize vessels yesterday helped lift the dry bulk market which had been falling since the start of the week on lower cargo demand. As a result the ...
Wednesday, 07 December 11
ABM INVESTAMA EYES RP6.3 TRIO REVENUE - INSIDER STORIES
Insider Stories reported that, an energy integrated company PT ABM Investama Tbk is eyeing a 1.5 folds increase in revenue this year from Rp4. ...
Tuesday, 06 December 11
DRY BULK MARKET ENDS RALLY, STARTS WEEK WITH FALL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
After a series of increases which saw the dry bulk market’s benchmark, the Baltic Dry Index (BDI) increasing close to 1,900 points and rates o ...
Monday, 05 December 11
THE DECEMBER HBA FELL 11% FROM ITS PEAK AT US$127.05 PER TON IN FEBRUARY 2011
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia has sets the December 2011 coal reference price at US$ 112.67 per ton US$ 3.98 ...
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- Metalloyd Limited - United Kingdom
- SN Aboitiz Power Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Semirara Mining Corp, Philippines
- Kumho Petrochemical, South Korea
- Toyota Tsusho Corporation, Japan
- Jaiprakash Power Ventures ltd
- Eastern Energy - Thailand
- Marubeni Corporation - India
- Aditya Birla Group - India
- Miang Besar Coal Terminal - Indonesia
- Central Electricity Authority - India
- Kohat Cement Company Ltd. - Pakistan
- Bhatia International Limited - India
- PTC India Limited - India
- White Energy Company Limited
- Ministry of Mines - Canada
- Pipit Mutiara Jaya. PT, Indonesia
- The University of Queensland
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- Independent Power Producers Association of India
- Sojitz Corporation - Japan
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- Commonwealth Bank - Australia
- Port Waratah Coal Services - Australia
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Electricity Authority, New Zealand
- Karaikal Port Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Australian Commodity Traders Exchange
- Vedanta Resources Plc - India
- Videocon Industries ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Essar Steel Hazira Ltd - India
- Chamber of Mines of South Africa
- Dalmia Cement Bharat India
- Power Finance Corporation Ltd., India
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- Bharathi Cement Corporation - India
- Bukit Makmur.PT - Indonesia
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Indika Energy - Indonesia
- Meralco Power Generation, Philippines
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- CNBM International Corporation - China
- Medco Energi Mining Internasional
- Jorong Barutama Greston.PT - Indonesia
- Global Coal Blending Company Limited - Australia
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- ASAPP Information Group - India
- TeaM Sual Corporation - Philippines
- Indian Oil Corporation Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Larsen & Toubro Limited - India
- Rashtriya Ispat Nigam Limited - India
- Gujarat Sidhee Cement - India
- Thiess Contractors Indonesia
- Sakthi Sugars Limited - India
- Mercator Lines Limited - India
- Kartika Selabumi Mining - Indonesia
- Cement Manufacturers Association - India
- Vizag Seaport Private Limited - India
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Ambuja Cements Ltd - India
- LBH Netherlands Bv - Netherlands
- McConnell Dowell - Australia
- PetroVietnam Power Coal Import and Supply Company
- Kideco Jaya Agung - Indonesia
- VISA Power Limited - India
- Goldman Sachs - Singapore
- Antam Resourcindo - Indonesia
- Bulk Trading Sa - Switzerland
- Eastern Coal Council - USA
- Indonesian Coal Mining Association
- Asmin Koalindo Tuhup - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Holcim Trading Pte Ltd - Singapore
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- Thai Mozambique Logistica
- Sarangani Energy Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Xindia Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Interocean Group of Companies - India
- Indogreen Group - Indonesia
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- ICICI Bank Limited - India
- Georgia Ports Authority, United States
- Tata Chemicals Ltd - India
- Attock Cement Pakistan Limited
- Coalindo Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- Price Waterhouse Coopers - Russia
- Manunggal Multi Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Trasteel International SA, Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- India Bulls Power Limited - India
- Romanian Commodities Exchange
- Madhucon Powers Ltd - India
- San Jose City I Power Corp, Philippines
- South Luzon Thermal Energy Corporation
- Merrill Lynch Commodities Europe
- Directorate General of MIneral and Coal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Formosa Plastics Group - Taiwan
- Simpson Spence & Young - Indonesia
- Bangladesh Power Developement Board
- Makarim & Taira - Indonesia
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Parry Sugars Refinery, India
- Rio Tinto Coal - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- GMR Energy Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- Neyveli Lignite Corporation Ltd, - India
- Orica Australia Pty. Ltd.
- Planning Commission, India
- Kaltim Prima Coal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Mjunction Services Limited - India
- Renaissance Capital - South Africa
- Iligan Light & Power Inc, Philippines
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- Petron Corporation, Philippines
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- Jindal Steel & Power Ltd - India
- Latin American Coal - Colombia
- The Treasury - Australian Government
- Billiton Holdings Pty Ltd - Australia
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- TNB Fuel Sdn Bhd - Malaysia
- Lanco Infratech Ltd - India
- Siam City Cement PLC, Thailand
- Minerals Council of Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Coal Association
- Ministry of Transport, Egypt
- Kobexindo Tractors - Indoneisa
- International Coal Ventures Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Malabar Cements Ltd - India
- PowerSource Philippines DevCo
- Globalindo Alam Lestari - Indonesia
- Standard Chartered Bank - UAE
- Energy Development Corp, Philippines
- Banpu Public Company Limited - Thailand
- Savvy Resources Ltd - HongKong
- Vijayanagar Sugar Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- OPG Power Generation Pvt Ltd - India
- MS Steel International - UAE
- Ind-Barath Power Infra Limited - India
- Energy Link Ltd, New Zealand
- SMC Global Power, Philippines
- CIMB Investment Bank - Malaysia
- Singapore Mercantile Exchange
- Star Paper Mills Limited - India
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercuria Energy - Indonesia
- Economic Council, Georgia
- Kepco SPC Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Bhushan Steel Limited - India
- Global Business Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Timah Investasi Mineral - Indoneisa
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Orica Mining Services - Indonesia
- Ministry of Finance - Indonesia
- Parliament of New Zealand
- Indian Energy Exchange, India
- Karbindo Abesyapradhi - Indoneisa
- Edison Trading Spa - Italy
- Sindya Power Generating Company Private Ltd
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