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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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Friday, 22 June 12
GLOBAL ACTION NEEDED ON ENERGY POVERTY - WORLD COAL
Eradicating energy poverty is possibly the biggest challenge facing the world today. Like climate change it can only be addressed with a concerted g ...
Friday, 22 June 12
COAL: THE BACKBONE OF MODERN ELECTRICITY - ECOAL
Coal has been described as the "forgotten fuel," perhaps because many aren't aware of the huge role it plays in powering the global econo ...
Thursday, 21 June 12
DRY BULK MARKET ON THE RISE AGAIN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was on the rise once again yesterday, with the Baltic Dry Index (BDI), the industry’s benchmark, rising by 18 points, or 1 ...
Wednesday, 20 June 12
BDI MOVING HIGHER, PANAMAX AND SUPRAMAX VESSELS STRONGER, CAPESIZE RATES NEAR TO HISTORICAL LOWS OF DECEMBER 2008 - MARIA BERTZELETOU, HELLENIC SHIPPING
The dry market seems to follow the dynamic of the previous week with the Baltic Dry Index showing daily increases since June 8th, but is still stand ...
Tuesday, 19 June 12
SMALLER DRY BULK CARRIERS LIFT UP MARKET, PANAMAXES SET TO FALL SAYS ANALYST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Another rise for the dry bulk market was evident yesterday, as the industry’s benchmark, the BDI (Baltic Dry Index) was up for a ninth straigh ...
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- Rashtriya Ispat Nigam Limited - India
- Gujarat Electricity Regulatory Commission - India
- Electricity Authority, New Zealand
- Australian Commodity Traders Exchange
- IHS Mccloskey Coal Group - USA
- MS Steel International - UAE
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Finance - Indonesia
- SMC Global Power, Philippines
- Metalloyd Limited - United Kingdom
- Orica Australia Pty. Ltd.
- Krishnapatnam Port Company Ltd. - India
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- GMR Energy Limited - India
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Economic Council, Georgia
- Commonwealth Bank - Australia
- Star Paper Mills Limited - India
- Semirara Mining and Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Attock Cement Pakistan Limited
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Wood Mackenzie - Singapore
- Bangladesh Power Developement Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Central Java Power - Indonesia
- Riau Bara Harum - Indonesia
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Green Power PLC Corporation, Philippines
- Thai Mozambique Logistica
- Port Waratah Coal Services - Australia
- Bharathi Cement Corporation - India
- Kepco SPC Power Corporation, Philippines
- Marubeni Corporation - India
- Eastern Coal Council - USA
- Barasentosa Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Thiess Contractors Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Iligan Light & Power Inc, Philippines
- San Jose City I Power Corp, Philippines
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Kaltim Prima Coal - Indonesia
- The State Trading Corporation of India Ltd
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- Energy Link Ltd, New Zealand
- Standard Chartered Bank - UAE
- Kalimantan Lumbung Energi - Indonesia
- London Commodity Brokers - England
- Minerals Council of Australia
- CIMB Investment Bank - Malaysia
- Australian Coal Association
- Petron Corporation, Philippines
- Edison Trading Spa - Italy
- Meralco Power Generation, Philippines
- Kumho Petrochemical, South Korea
- Bukit Baiduri Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Energy Development Corp, Philippines
- PowerSource Philippines DevCo
- Ceylon Electricity Board - Sri Lanka
- Intertek Mineral Services - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Coastal Gujarat Power Limited - India
- CNBM International Corporation - China
- McConnell Dowell - Australia
- Sakthi Sugars Limited - India
- Deloitte Consulting - India
- Billiton Holdings Pty Ltd - Australia
- Globalindo Alam Lestari - Indonesia
- Indonesian Coal Mining Association
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Mercuria Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Videocon Industries ltd - India
- Jindal Steel & Power Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- Independent Power Producers Association of India
- Merrill Lynch Commodities Europe
- Ind-Barath Power Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Borneo Indobara - Indonesia
- Planning Commission, India
- Maheswari Brothers Coal Limited - India
- Simpson Spence & Young - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Wilmar Investment Holdings
- Central Electricity Authority - India
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
- Karaikal Port Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Xindia Steels Limited - India
- Altura Mining Limited, Indonesia
- Interocean Group of Companies - India
- Savvy Resources Ltd - HongKong
- European Bulk Services B.V. - Netherlands
- Samtan Co., Ltd - South Korea
- LBH Netherlands Bv - Netherlands
- Carbofer General Trading SA - India
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- Eastern Energy - Thailand
- Bhushan Steel Limited - India
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- Bhatia International Limited - India
- SN Aboitiz Power Inc, Philippines
- Agrawal Coal Company - India
- Straits Asia Resources Limited - Singapore
- Tamil Nadu electricity Board
- Jorong Barutama Greston.PT - Indonesia
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- Sarangani Energy Corporation, Philippines
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Indian Energy Exchange, India
- Toyota Tsusho Corporation, Japan
- Price Waterhouse Coopers - Russia
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- Uttam Galva Steels Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- Aboitiz Power Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- Cement Manufacturers Association - India
- Power Finance Corporation Ltd., India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indo Tambangraya Megah - Indonesia
- The University of Queensland
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- Global Coal Blending Company Limited - Australia
- Ambuja Cements Ltd - India
- GVK Power & Infra Limited - India
- Mjunction Services Limited - India
- Siam City Cement - Thailand
- Sojitz Corporation - Japan
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Makmur.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- VISA Power Limited - India
- Electricity Generating Authority of Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PTC India Limited - India
- Baramulti Group, Indonesia
- International Coal Ventures Pvt Ltd - India
- SMG Consultants - Indonesia
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Meenaskhi Energy Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- IEA Clean Coal Centre - UK
- Pendopo Energi Batubara - Indonesia
- Tata Chemicals Ltd - India
- Ministry of Mines - Canada
- Makarim & Taira - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- New Zealand Coal & Carbon
- Goldman Sachs - Singapore
- Bayan Resources Tbk. - Indonesia
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Larsen & Toubro Limited - India
- The Treasury - Australian Government
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- ICICI Bank Limited - India
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- Malabar Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Latin American Coal - Colombia
- Madhucon Powers Ltd - India
- OPG Power Generation Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Parry Sugars Refinery, India
- Indika Energy - Indonesia
- Aditya Birla Group - India
- Essar Steel Hazira Ltd - India
- ASAPP Information Group - India
- Parliament of New Zealand
- Leighton Contractors Pty Ltd - Australia
- Directorate General of MIneral and Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Coalindo Energy - Indonesia
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