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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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Sunday, 17 June 12
S7 & S8 ROUTES ARE LIKELY TO BE SOFT NEXT WEEK - VISTAAR
COALspot.com - The BDI gained some increase after continues fall for several weeks.
The BDI increased by 47 points (up by 5.36 pct) closing at 92 ...
Saturday, 16 June 12
INDONESIAN SUB-BITUMINOUS COAL & CFR SOUTH CHINA COAL CONTRACT SWAPS ARE UNDER PRESSURE
COALspot.com - Indonesian sub-bituminous coal swaps and CFR South China coal contracts for July deliveries seems to be under pressure this week.&nbs ...
Friday, 15 June 12
CAPESIZE - THE LEVELS THAT DID FIX ARE DOWN W-O-W LEVELS - FEARNLEYS
Handy
Another slow-moving market with rates hovering at same level as last week. US Gulf positions fixed USD 25,000 for trips to Cont/Passero and S ...
Thursday, 14 June 12
SMALLER DRY BULK CARRIERS LIKELY TO FACE MORE CHALLENGES; DEMOLITION ACTIVITY SET FOR RECORD YEAR - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In its latest update on the dry bulk markets, BIMCO said that China is partly “failing to deliver” on raw material imports that can affe ...
Wednesday, 13 June 12
LOW COAL PRICES COULD CHANGE SUPPLY SIDE DYNAMICS - FITCH RATINGS
Fitch Ratings believes that the weakness seen in thermal coal prices in recent months should reverse once demand from major importers recovers, alth ...
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- Power Finance Corporation Ltd., India
- Dalmia Cement Bharat India
- Planning Commission, India
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Electricity Authority, New Zealand
- CIMB Investment Bank - Malaysia
- SN Aboitiz Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Singapore Mercantile Exchange
- Economic Council, Georgia
- Neyveli Lignite Corporation Ltd, - India
- Australian Commodity Traders Exchange
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Africa Commodities Group - South Africa
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Grasim Industreis Ltd - India
- PTC India Limited - India
- Deloitte Consulting - India
- Cigading International Bulk Terminal - Indonesia
- Aboitiz Power Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Indogreen Group - Indonesia
- Sindya Power Generating Company Private Ltd
- Uttam Galva Steels Limited - India
- Trasteel International SA, Italy
- Parry Sugars Refinery, India
- SMC Global Power, Philippines
- Makarim & Taira - Indonesia
- Attock Cement Pakistan Limited
- Semirara Mining and Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- Manunggal Multi Energi - Indonesia
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Siam City Cement - Thailand
- Chamber of Mines of South Africa
- Wilmar Investment Holdings
- Kumho Petrochemical, South Korea
- Indian Energy Exchange, India
- Australian Coal Association
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- Ministry of Finance - Indonesia
- Sree Jayajothi Cements Limited - India
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Independent Power Producers Association of India
- Lanco Infratech Ltd - India
- Baramulti Group, Indonesia
- GVK Power & Infra Limited - India
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Petron Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- GMR Energy Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Coastal Gujarat Power Limited - India
- Bharathi Cement Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Posco Energy - South Korea
- Savvy Resources Ltd - HongKong
- Straits Asia Resources Limited - Singapore
- Ind-Barath Power Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Gujarat Sidhee Cement - India
- Merrill Lynch Commodities Europe
- Tamil Nadu electricity Board
- Kobexindo Tractors - Indoneisa
- Samtan Co., Ltd - South Korea
- McConnell Dowell - Australia
- Riau Bara Harum - Indonesia
- Altura Mining Limited, Indonesia
- Pendopo Energi Batubara - Indonesia
- Meenaskhi Energy Private Limited - India
- Binh Thuan Hamico - Vietnam
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Malabar Cements Ltd - India
- Mjunction Services Limited - India
- MS Steel International - UAE
- Thai Mozambique Logistica
- Karbindo Abesyapradhi - Indoneisa
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- Maheswari Brothers Coal Limited - India
- Kideco Jaya Agung - Indonesia
- Wood Mackenzie - Singapore
- PowerSource Philippines DevCo
- GN Power Mariveles Coal Plant, Philippines
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- The University of Queensland
- Iligan Light & Power Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Global Coal Blending Company Limited - Australia
- Romanian Commodities Exchange
- Bayan Resources Tbk. - Indonesia
- Georgia Ports Authority, United States
- Toyota Tsusho Corporation, Japan
- PetroVietnam Power Coal Import and Supply Company
- Electricity Generating Authority of Thailand
- Ministry of Transport, Egypt
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Jaiprakash Power Ventures ltd
- Price Waterhouse Coopers - Russia
- Central Java Power - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Minerals Council of Australia
- Indika Energy - Indonesia
- India Bulls Power Limited - India
- Coal and Oil Company - UAE
- Eastern Energy - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Cement Manufacturers Association - India
- Central Electricity Authority - India
- GAC Shipping (India) Pvt Ltd
- Rio Tinto Coal - Australia
- Krishnapatnam Port Company Ltd. - India
- Thiess Contractors Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Therma Luzon, Inc, Philippines
- Agrawal Coal Company - India
- Sical Logistics Limited - India
- Marubeni Corporation - India
- Antam Resourcindo - Indonesia
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- Bulk Trading Sa - Switzerland
- Sinarmas Energy and Mining - Indonesia
- Vedanta Resources Plc - India
- Anglo American - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kaltim Prima Coal - Indonesia
- Tata Chemicals Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Star Paper Mills Limited - India
- Karaikal Port Pvt Ltd - India
- Renaissance Capital - South Africa
- Commonwealth Bank - Australia
- Rashtriya Ispat Nigam Limited - India
- Coalindo Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- CNBM International Corporation - China
- Meralco Power Generation, Philippines
- Directorate Of Revenue Intelligence - India
- Kapuas Tunggal Persada - Indonesia
- LBH Netherlands Bv - Netherlands
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- Jorong Barutama Greston.PT - Indonesia
- TeaM Sual Corporation - Philippines
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Mintek Dendrill Indonesia
- Bhushan Steel Limited - India
- AsiaOL BioFuels Corp., Philippines
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Parliament of New Zealand
- ICICI Bank Limited - India
- Sarangani Energy Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Timah Investasi Mineral - Indoneisa
- Vizag Seaport Private Limited - India
- Leighton Contractors Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Medco Energi Mining Internasional
- Simpson Spence & Young - Indonesia
- Sojitz Corporation - Japan
- Indian Oil Corporation Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- New Zealand Coal & Carbon
- VISA Power Limited - India
- Goldman Sachs - Singapore
- Jindal Steel & Power Ltd - India
- Port Waratah Coal Services - Australia
- London Commodity Brokers - England
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Kartika Selabumi Mining - Indonesia
- Indonesian Coal Mining Association
- Borneo Indobara - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
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