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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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Saturday, 07 July 12
EXCESS SUPPLY & WEAK DEMAND KEEP COAL PRICES LOW
COALspot.com - SGX AsiaClear OTC Coal Swaps for August and Q4 deliveries slipped slightly this week. SGX’s Indonesian sub-bituminous coal swap ...
Saturday, 07 July 12
BALTIC INDEX UP ON STRONG CAPE, PANAMAX RATES - VISTAAR
COALspot.com - This week all the segments were firmed up with BDI up by 15.23 pct (up by 153 points) closing at 1,157 points.
The cape index also ...
Saturday, 07 July 12
DRY BULK MARKET NOT ABLE TO FIND SOLID GROUND SAY EXPERTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the second half of each, traditionally looking the most active one, especially in terms of newbuildings being delivered, it's highly unlikely ...
Thursday, 05 July 12
GOVT GETS READY FOR $1.8B SUIT - THE JAKARTA POST
The Jakarta Post, one of the leading Indonesian English new papers reported that, several ministries and the Attorney General’s Office held a ...
Thursday, 05 July 12
DRY BULK MARKET MOVES FURTHER UP THE HILL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its growth momentum by the middle of the week, as the BDI (Baltic Dry Index) rose by an additional 40 points to 1,103 p ...
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- Bank of Tokyo Mitsubishi UFJ Ltd
- Ambuja Cements Ltd - India
- Ministry of Finance - Indonesia
- Thiess Contractors Indonesia
- Bhatia International Limited - India
- Semirara Mining and Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Australian Coal Association
- Eastern Coal Council - USA
- Independent Power Producers Association of India
- Indogreen Group - Indonesia
- Cement Manufacturers Association - India
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Central Electricity Authority - India
- South Luzon Thermal Energy Corporation
- Vijayanagar Sugar Pvt Ltd - India
- Grasim Industreis Ltd - India
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Global Business Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Kobexindo Tractors - Indoneisa
- Singapore Mercantile Exchange
- Power Finance Corporation Ltd., India
- Gujarat Sidhee Cement - India
- Simpson Spence & Young - Indonesia
- Meralco Power Generation, Philippines
- San Jose City I Power Corp, Philippines
- Posco Energy - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Salva Resources Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Heidelberg Cement - Germany
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- Vizag Seaport Private Limited - India
- Bukit Baiduri Energy - Indonesia
- Planning Commission, India
- Jorong Barutama Greston.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- PowerSource Philippines DevCo
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Banpu Public Company Limited - Thailand
- Orica Mining Services - Indonesia
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- Jindal Steel & Power Ltd - India
- Sical Logistics Limited - India
- Therma Luzon, Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Rio Tinto Coal - Australia
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Maheswari Brothers Coal Limited - India
- Economic Council, Georgia
- Kapuas Tunggal Persada - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- GVK Power & Infra Limited - India
- Bharathi Cement Corporation - India
- Bhoruka Overseas - Indonesia
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Directorate General of MIneral and Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kartika Selabumi Mining - Indonesia
- SMC Global Power, Philippines
- Vedanta Resources Plc - India
- Chamber of Mines of South Africa
- Goldman Sachs - Singapore
- ICICI Bank Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Mjunction Services Limited - India
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- Sojitz Corporation - Japan
- Videocon Industries ltd - India
- SN Aboitiz Power Inc, Philippines
- Latin American Coal - Colombia
- Bayan Resources Tbk. - Indonesia
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Central Java Power - Indonesia
- LBH Netherlands Bv - Netherlands
- European Bulk Services B.V. - Netherlands
- Mercuria Energy - Indonesia
- Marubeni Corporation - India
- Thai Mozambique Logistica
- OPG Power Generation Pvt Ltd - India
- Trasteel International SA, Italy
- Eastern Energy - Thailand
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Anglo American - United Kingdom
- Riau Bara Harum - Indonesia
- Global Green Power PLC Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Ind-Barath Power Infra Limited - India
- Merrill Lynch Commodities Europe
- PTC India Limited - India
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- Africa Commodities Group - South Africa
- Manunggal Multi Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Port Waratah Coal Services - Australia
- New Zealand Coal & Carbon
- Coalindo Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Baramulti Group, Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sakthi Sugars Limited - India
- Indian Oil Corporation Limited
- Coastal Gujarat Power Limited - India
- Ministry of Mines - Canada
- Attock Cement Pakistan Limited
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Commonwealth Bank - Australia
- Mintek Dendrill Indonesia
- Star Paper Mills Limited - India
- TeaM Sual Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Medco Energi Mining Internasional
- Romanian Commodities Exchange
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- Intertek Mineral Services - Indonesia
- Aboitiz Power Corporation - Philippines
- Electricity Authority, New Zealand
- Xindia Steels Limited - India
- Jaiprakash Power Ventures ltd
- Indo Tambangraya Megah - Indonesia
- McConnell Dowell - Australia
- Bulk Trading Sa - Switzerland
- Agrawal Coal Company - India
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Renaissance Capital - South Africa
- Malabar Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Uttam Galva Steels Limited - India
- Energy Link Ltd, New Zealand
- Toyota Tsusho Corporation, Japan
- Global Coal Blending Company Limited - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tamil Nadu electricity Board
- PetroVietnam Power Coal Import and Supply Company
- Ceylon Electricity Board - Sri Lanka
- Meenaskhi Energy Private Limited - India
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Larsen & Toubro Limited - India
- Petron Corporation, Philippines
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- White Energy Company Limited
- Kaltim Prima Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Indian Energy Exchange, India
- Directorate Of Revenue Intelligence - India
- Price Waterhouse Coopers - Russia
- VISA Power Limited - India
- International Coal Ventures Pvt Ltd - India
- The University of Queensland
- Indika Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- GN Power Mariveles Coal Plant, Philippines
- Georgia Ports Authority, United States
- Bangladesh Power Developement Board
- Billiton Holdings Pty Ltd - Australia
- Mercator Lines Limited - India
- Siam City Cement PLC, Thailand
- Tata Chemicals Ltd - India
- CIMB Investment Bank - Malaysia
- Binh Thuan Hamico - Vietnam
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- Deloitte Consulting - India
- Chettinad Cement Corporation Ltd - India
- Minerals Council of Australia
- Karaikal Port Pvt Ltd - India
- SMG Consultants - Indonesia
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement - Thailand
- Aditya Birla Group - India
- PNOC Exploration Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
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