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Monday, 12 March 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
 The first days of March appear to be more encouraging for dry bulk operators, but the outlook is still gloomy for the rest of year with earnings for large sized vessels, capesizes floating below breakeven levels. The Baltic Dry Index records daily gains for eleven consecutive days, closing on Friday March 9th at 824 points, up by 6.8% on a weekly basis and up by 17% from February 23rd. All vessel categories experienced positive upturn apart from capesizes with supramaxes being the star performers of this week. The Baltic Supramax Index posted a 16% week-on-week increase in contrast with a 5% rise in the panamax and 7% in the handysize segment. Capesize vessel earnings remain downsized with industry players expecting a stronger Chinese steel production in March -April period and massive destocking of iron ore at major ports that will create more cargo loadings and lift earnings, at least near to $10,000/day.
The sentiment in China’s daily steel output has improved in February at 1,93 million tones, up from 1.83 million tons in January and 1.6827 million tons in December, as mills began ramping up operations ahead of a predicted recovery in demand in March and April. The figures of February are considerably higher than the estimates issued by China Iron and Steel Association, which calculated daily crude steel output at less than 1,7 million tones in February. Traders have said that recent destocking activity indicates further improvements in the market over the coming weeks. We may not see an immediate and rapid rise in steel output, but destocking is going on increasingly, so I am optimistic about steel prices because supply hasn't grown much”, said a trader based in Beijing. "Some new construction sites in northern Chinese regions have not started due to the cold snap, but once these new projects begin, it will provide a big lift for steel demand," he said, adding that he expected prices to keep rising until the end of April. China's industry ministry said China's crude steel output was expected to rise 7 percent to 730 million tons this year, after growing 8.9% last year. However, some steel mills have predicted that real demand could remain flat in 2012, and they warn of further losses over the course of the year as they try to overcome longstanding overcapacity issues.
Capesizes, which typically transport 150,000 ton cargoes of iron ore and coal, are currently earning $5,786/day, less than handysizes that earn more than $6,000 daily with the BCI loosing 22 points, down by 1.4% on a weekly basis and standing at 1503 points. Vale has completed its first VLOC transshipment of iron ore, which could drive more capesize tonnage requirements but the impact will be minor given the glut of ships. The long list of available ships for prompt employment continues to weigh heavily on the market with ships struggling to find cargo, especially in the Atlantic market. After a couple of weeks at $7.90, Rio Tinto shaved 10 cents off the rate for a March 21 onwards 160,000-tonne cargo from Dampier to China.
Panamax and supramax units continue to show stronger performance against capesize on the back of a firmer amount of global grain and coal fixtures activity. However, there are always exogenous threats on the prosperity with Indonesian National Shipowners Association, following China’s example, urging the government to pass the Domestic Transporter Obligation, which could mandate that 30% of all Indonesian coal shipments to be shipped on vessels owned by Indonesian shipping companies. According to Indonesian National Shipowners Association, foreign shipowners earned $14.4 billion in 2011 from exporting Indonesian coal with Indonesian shipowners wishing to receive a large share of this earned capital.
Panamaxes are currently earning $7,129/day with the BPI moving 45 points upward, 5.3% up on a weekly basis. The focus remains on east coast South America, with increased grain cargoes particularly for first half April sparking a rise in rates. A 1996-built 73,000 tonner agreed $15,750 daily plus a $575,000 bonus for the run east. Ships from the Continent and Mediterranean, as well as the Indian Ocean and south East Asia, eyed the South American market.
In the supramax market, vessels, which carry about 25 percent less than panamaxes, are the star performers during the first days of March by earning about $9,000/day with the BSI standing at 864 points, up by 16% on a weekly basis. However, supramaxes were getting more than $15,000/day last year, up by 77% from the current levels and 45% higher levels than capesizes. Rates in the Atlantic finally improved after the Far Eastern markets had been leading the way for quite some time. In the East, the south-east Asia mineral trades continued to absorb plenty of tonnage and the market consequently maintained a firming trend.
Handysize vessels, for three consecutive weeks have shown firmer returns with the BHSI standing at 469 points, a 7% week-on-week increase, and earnings rising to $7,106/day, but still 35% lower than last year’s levels.
The glut of new ship deliveries and the weak sentiment in China’s steel market are serious factors with a negative impact on the healthy performance of the capesize segment, which is the main driver lying behind the positive incline of the Baltic Dry Index, above the psychological barrier of 1,000 points mark.
China’s announcement to lower its 2012 growth target to 7.5% after 7 consecutive years darkens the outlook of dry bulk shipping industry with insiders expecting a prolong of the shipping crisis. Moody’s Investor Service said that the global shipping slump is expected to stay till 2013, while growing credit squeeze will challenge even the toughest shipping companies. Rio Tinto PLC's (RIO) iron ore chief executive, Sam Walsh, said that he expects China to remain a key driver of iron ore demand growth, despite recent signs for a slow growth in Chinese economy. China is "resilient," Walsh said, as it is equipped to underline its growth with fiscal and monetary changes and has increasing rates of household and corporate savings.
The country's crude steel consumption is forecasted to be around 1 billion metric tons by 2020, representing just under half of forecast world consumption, he noted. Rio Tinto is planning to invest $2 billion in Indian iron ore mining in Keonjhar district in the Indian federal state of Orissa. Mr. Walsh said that his company intends to raise production in Orissa to 15m tonnes per year “quickly” and at least some of the ore would be sold overseas, enabling shipowners to benefit from increased export demand.
The first quarter of 2012 is near to end and the trends seem to be negative for capesize with a sense of stability in the panamax and a firm growth of earnings in the supramax and handysize segment. The BDI is 18% lower than the 1,000 points mark and the solid performance of supramax vessels may boost the index at higher levels before the end of March.
Source: Maria Bertzeletou, Hellenic Shipping
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Wednesday, 18 July 12
SHIP PRICES HAVE FALLEN RAPIDLY THIS YEAR, FAVORING INVESTORS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The price for a 5 year old Capesize dry bulk carrier of 172,000 dwt has fallen to about $33,4mil from $42.9 at the end of June 2011, while at end of ...
Saturday, 14 July 12
FREIGHT MARKET SEEMS TO BE QUITE VOLATILE - VISTAAR
COALspot.com - The market seems to be quite volatile with the trend changing almost every week. This week all the segments were down except for Pana ...
Friday, 13 July 12
TRANSCOAL MINERGY HAS RECEIVED PMA STATUS IN INDONESIA
COALspot.com - PT Transcoal Minergy (“TCM”) has received official foreign owned company status from the Capital Investment Coordinating ...
Thursday, 12 July 12
LACK OF CAPESIZE DEMAND DRAGS DRY BULK MARKET LOWER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A lack of demand for the larger Capesize dry bulk carriers had as a result the fall of the industry’s benchmark, the BDI (Baltic Dry Index), w ...
Thursday, 12 July 12
RIO TINTO'S SENIOR MANAGEMENT CHANGES
COALspot.com - Rio Tinto is making changes to its senior management team as chief financial officer (CFO) Guy Elliott has decided to retire at the e ...
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- Pipit Mutiara Jaya. PT, Indonesia
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- Ministry of Transport, Egypt
- Ind-Barath Power Infra Limited - India
- Eastern Energy - Thailand
- Jindal Steel & Power Ltd - India
- Global Coal Blending Company Limited - Australia
- India Bulls Power Limited - India
- Mjunction Services Limited - India
- MS Steel International - UAE
- Carbofer General Trading SA - India
- CNBM International Corporation - China
- Samtan Co., Ltd - South Korea
- Energy Development Corp, Philippines
- Marubeni Corporation - India
- New Zealand Coal & Carbon
- Antam Resourcindo - Indonesia
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- Chamber of Mines of South Africa
- Economic Council, Georgia
- Meralco Power Generation, Philippines
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Romanian Commodities Exchange
- Jaiprakash Power Ventures ltd
- Merrill Lynch Commodities Europe
- Minerals Council of Australia
- Simpson Spence & Young - Indonesia
- Kideco Jaya Agung - Indonesia
- South Luzon Thermal Energy Corporation
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- AsiaOL BioFuels Corp., Philippines
- Petron Corporation, Philippines
- Makarim & Taira - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Commonwealth Bank - Australia
- Coastal Gujarat Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Bhatia International Limited - India
- Binh Thuan Hamico - Vietnam
- Globalindo Alam Lestari - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- Sree Jayajothi Cements Limited - India
- Bulk Trading Sa - Switzerland
- Oldendorff Carriers - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Bangladesh Power Developement Board
- Madhucon Powers Ltd - India
- The State Trading Corporation of India Ltd
- Bayan Resources Tbk. - Indonesia
- SN Aboitiz Power Inc, Philippines
- ASAPP Information Group - India
- Posco Energy - South Korea
- Interocean Group of Companies - India
- Indian Energy Exchange, India
- Renaissance Capital - South Africa
- Electricity Authority, New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Georgia Ports Authority, United States
- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- Parliament of New Zealand
- Bukit Baiduri Energy - Indonesia
- Eastern Coal Council - USA
- Chettinad Cement Corporation Ltd - India
- Orica Mining Services - Indonesia
- Gujarat Sidhee Cement - India
- VISA Power Limited - India
- The University of Queensland
- PTC India Limited - India
- Baramulti Group, Indonesia
- Price Waterhouse Coopers - Russia
- Anglo American - United Kingdom
- Maheswari Brothers Coal Limited - India
- Sical Logistics Limited - India
- Standard Chartered Bank - UAE
- GN Power Mariveles Coal Plant, Philippines
- Pendopo Energi Batubara - Indonesia
- SMG Consultants - Indonesia
- Power Finance Corporation Ltd., India
- Deloitte Consulting - India
- Latin American Coal - Colombia
- Manunggal Multi Energi - Indonesia
- Australian Coal Association
- Essar Steel Hazira Ltd - India
- Metalloyd Limited - United Kingdom
- Ambuja Cements Ltd - India
- PNOC Exploration Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Sarangani Energy Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Banpu Public Company Limited - Thailand
- CIMB Investment Bank - Malaysia
- Riau Bara Harum - Indonesia
- Medco Energi Mining Internasional
- Asmin Koalindo Tuhup - Indonesia
- Rio Tinto Coal - Australia
- SMC Global Power, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- PowerSource Philippines DevCo
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- The Treasury - Australian Government
- Karaikal Port Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Thai Mozambique Logistica
- GAC Shipping (India) Pvt Ltd
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Tata Chemicals Ltd - India
- Directorate Of Revenue Intelligence - India
- Sakthi Sugars Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Videocon Industries ltd - India
- Meenaskhi Energy Private Limited - India
- Toyota Tsusho Corporation, Japan
- Mercuria Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Indonesian Coal Mining Association
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- Kapuas Tunggal Persada - Indonesia
- White Energy Company Limited
- Malabar Cements Ltd - India
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Siam City Cement - Thailand
- Planning Commission, India
- Grasim Industreis Ltd - India
- Indika Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Central Java Power - Indonesia
- Sojitz Corporation - Japan
- Tamil Nadu electricity Board
- Attock Cement Pakistan Limited
- Ministry of Finance - Indonesia
- Salva Resources Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Holcim Trading Pte Ltd - Singapore
- Wilmar Investment Holdings
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vedanta Resources Plc - India
- Indian Oil Corporation Limited
- Agrawal Coal Company - India
- GMR Energy Limited - India
- McConnell Dowell - Australia
- Lanco Infratech Ltd - India
- Kaltim Prima Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Altura Mining Limited, Indonesia
- Ministry of Mines - Canada
- Energy Link Ltd, New Zealand
- Star Paper Mills Limited - India
- Dalmia Cement Bharat India
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Timah Investasi Mineral - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
- Coalindo Energy - Indonesia
- Aditya Birla Group - India
- Rashtriya Ispat Nigam Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bharathi Cement Corporation - India
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Billiton Holdings Pty Ltd - Australia
- Xindia Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Edison Trading Spa - Italy
- Alfred C Toepfer International GmbH - Germany
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Wood Mackenzie - Singapore
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