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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, 01 June 12
COKAL ACCEPTED ON THE CLEAN AND CLEAR LIST FOR ITS BORNEO BARA PRIMA AND BUMI BARITO MINERAL PROJECTS
- Borneo Bara Prima (BBP) Project confirmed on the Clean and Clear List 9th May 2012
- Bumi Barito Mineral (BBM) Project confirmed on the Clean and ...
Friday, 01 June 12
ADARO BUYS MAJORITY STAKE IN AFFILIATED BHAKTI ENERGI - INSIDER STORIES
Insider Stories reported that, PT Adaro Energy Tbk entered into an option to provide a convertible loan of up to US$500 million for a period of 3 ye ...
Thursday, 31 May 12
DRY BULK MARKET UNABLE TO FIND NEW SUPPORT TO REACH HIGHER LEVELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been unable to find new support and recover to higher levels during these past few days. As a result, the Baltic Dry Index ( ...
Wednesday, 30 May 12
ORPHEUS RAISES $2.24M TO ADVANCE INDONESIAN COAL PRODUCTION ASSETS
• $2.24 million raised from a placement to new and existing institutional and sophisticated investors from Australia and overseas
• Funds ...
Wednesday, 30 May 12
ARPENI SECURES TRANSSHIPMENT CONTRACT FROM BARUNA DIRGA
Insider Stories reported that, shipping operator PT Arpeni Pratama Ocean Line Tbk (APOL) has secured a 1-year coal transhipment contract of 4 millio ...
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- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- PetroVietnam Power Coal Import and Supply Company
- Wilmar Investment Holdings
- Global Business Power Corporation, Philippines
- Sical Logistics Limited - India
- The Treasury - Australian Government
- Altura Mining Limited, Indonesia
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- VISA Power Limited - India
- Ministry of Finance - Indonesia
- Therma Luzon, Inc, Philippines
- Power Finance Corporation Ltd., India
- Sakthi Sugars Limited - India
- Savvy Resources Ltd - HongKong
- Meenaskhi Energy Private Limited - India
- Ind-Barath Power Infra Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- Renaissance Capital - South Africa
- OPG Power Generation Pvt Ltd - India
- Coal and Oil Company - UAE
- Ministry of Transport, Egypt
- McConnell Dowell - Australia
- Edison Trading Spa - Italy
- Kartika Selabumi Mining - Indonesia
- Anglo American - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- Bhushan Steel Limited - India
- Parliament of New Zealand
- Electricity Generating Authority of Thailand
- Pendopo Energi Batubara - Indonesia
- ASAPP Information Group - India
- Cement Manufacturers Association - India
- Standard Chartered Bank - UAE
- Indika Energy - Indonesia
- Wood Mackenzie - Singapore
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- PTC India Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- New Zealand Coal & Carbon
- Meralco Power Generation, Philippines
- South Luzon Thermal Energy Corporation
- Indian Energy Exchange, India
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Binh Thuan Hamico - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Tata Chemicals Ltd - India
- SMC Global Power, Philippines
- Planning Commission, India
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indonesian Coal Mining Association
- Kaltim Prima Coal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Karaikal Port Pvt Ltd - India
- Romanian Commodities Exchange
- India Bulls Power Limited - India
- Global Coal Blending Company Limited - Australia
- Xindia Steels Limited - India
- Bhoruka Overseas - Indonesia
- PNOC Exploration Corporation - Philippines
- Latin American Coal - Colombia
- Miang Besar Coal Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Cigading International Bulk Terminal - Indonesia
- Ambuja Cements Ltd - India
- Singapore Mercantile Exchange
- Thai Mozambique Logistica
- Antam Resourcindo - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Gujarat Sidhee Cement - India
- TNB Fuel Sdn Bhd - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- Bayan Resources Tbk. - Indonesia
- Interocean Group of Companies - India
- Straits Asia Resources Limited - Singapore
- Economic Council, Georgia
- Chettinad Cement Corporation Ltd - India
- Larsen & Toubro Limited - India
- Alfred C Toepfer International GmbH - Germany
- Barasentosa Lestari - Indonesia
- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Timah Investasi Mineral - Indoneisa
- White Energy Company Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- AsiaOL BioFuels Corp., Philippines
- SMG Consultants - Indonesia
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- Heidelberg Cement - Germany
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Makarim & Taira - Indonesia
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Mintek Dendrill Indonesia
- The State Trading Corporation of India Ltd
- Sree Jayajothi Cements Limited - India
- Manunggal Multi Energi - Indonesia
- Kepco SPC Power Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Minerals Council of Australia
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- Central Electricity Authority - India
- Madhucon Powers Ltd - India
- Posco Energy - South Korea
- MS Steel International - UAE
- Billiton Holdings Pty Ltd - Australia
- Thiess Contractors Indonesia
- Bharathi Cement Corporation - India
- Oldendorff Carriers - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Riau Bara Harum - Indonesia
- Mjunction Services Limited - India
- Maheswari Brothers Coal Limited - India
- LBH Netherlands Bv - Netherlands
- Bukit Makmur.PT - Indonesia
- Eastern Coal Council - USA
- Holcim Trading Pte Ltd - Singapore
- Rashtriya Ispat Nigam Limited - India
- Indian Oil Corporation Limited
- Price Waterhouse Coopers - Russia
- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Formosa Plastics Group - Taiwan
- SN Aboitiz Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- Bukit Baiduri Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- Baramulti Group, Indonesia
- Deloitte Consulting - India
- Neyveli Lignite Corporation Ltd, - India
- Commonwealth Bank - Australia
- Coastal Gujarat Power Limited - India
- Malabar Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Ministry of Mines - Canada
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
- Bangladesh Power Developement Board
- Aditya Birla Group - India
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Electricity Authority, New Zealand
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Lanco Infratech Ltd - India
- Indo Tambangraya Megah - Indonesia
- Uttam Galva Steels Limited - India
- Bhatia International Limited - India
- Sarangani Energy Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Siam City Cement - Thailand
- IEA Clean Coal Centre - UK
- Toyota Tsusho Corporation, Japan
- Central Java Power - Indonesia
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Gujarat Mineral Development Corp Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mercuria Energy - Indonesia
- Chamber of Mines of South Africa
- Sindya Power Generating Company Private Ltd
- San Jose City I Power Corp, Philippines
- Trasteel International SA, Italy
- Sojitz Corporation - Japan
- Global Green Power PLC Corporation, Philippines
- Parry Sugars Refinery, India
- Bulk Trading Sa - Switzerland
- Independent Power Producers Association of India
- Rio Tinto Coal - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Star Paper Mills Limited - India
- Marubeni Corporation - India
- London Commodity Brokers - England
- GMR Energy Limited - India
- Metalloyd Limited - United Kingdom
- Vedanta Resources Plc - India
- The University of Queensland
- Leighton Contractors Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- Grasim Industreis Ltd - India
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