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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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Tuesday, 15 May 12
POTENTIAL BOOM OF CHINAS COAL IMPORTS COULD PROVIDE FURTHER SUPPORT TO DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been moving sideways during the past week with the industry’s benchmark, the Baltic Dry Index (BDI) losing 0.53% on th ...
Saturday, 12 May 12
THE SHIPPING MARKET IS UNLIKELY TO SEE A REBOUND ANYTIME SOON - VISTAAR SINGAPORE
COALspot.com - The BDI softened this week and it was down by 1.64 pct closing at 1,138 points.
The cape index was up by 2.41 pct closing at 1,61 ...
Friday, 11 May 12
POLITICAL CHANGES COULD LEAD TO TEMPORARY HALT IN SHIPPING INVESTMENTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The potential of changes of political leadership in many of the world’s leading economies could very well lead to significant shifts in the di ...
Thursday, 10 May 12
DRY BULK ERRATIC ON LACK OF DIRECTION - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept up its erratic behavior as it went down again during yesterday’s session, on a lack of direct guidance in terms o ...
Wednesday, 09 May 12
COAL INDIA SIGNS FSAS WITH 13 POWER UNITS SO FAR - PTI
Press Trust of India has reported that, coal India has so far entered into fuel supply pacts with 13 power units, including Reliance Power's Rosa P ...
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- Kaltim Prima Coal - Indonesia
- Merrill Lynch Commodities Europe
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Xindia Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhatia International Limited - India
- Sical Logistics Limited - India
- Leighton Contractors Pty Ltd - Australia
- Latin American Coal - Colombia
- Formosa Plastics Group - Taiwan
- Mjunction Services Limited - India
- Siam City Cement PLC, Thailand
- Planning Commission, India
- Africa Commodities Group - South Africa
- Georgia Ports Authority, United States
- Orica Mining Services - Indonesia
- Manunggal Multi Energi - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Mintek Dendrill Indonesia
- Global Green Power PLC Corporation, Philippines
- Sakthi Sugars Limited - India
- Australian Commodity Traders Exchange
- Sojitz Corporation - Japan
- South Luzon Thermal Energy Corporation
- Jaiprakash Power Ventures ltd
- Vijayanagar Sugar Pvt Ltd - India
- Marubeni Corporation - India
- Bhushan Steel Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jindal Steel & Power Ltd - India
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Grasim Industreis Ltd - India
- San Jose City I Power Corp, Philippines
- Samtan Co., Ltd - South Korea
- Ind-Barath Power Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- LBH Netherlands Bv - Netherlands
- Ambuja Cements Ltd - India
- Indian Energy Exchange, India
- Energy Link Ltd, New Zealand
- Commonwealth Bank - Australia
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Finance - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Binh Thuan Hamico - Vietnam
- Semirara Mining Corp, Philippines
- Altura Mining Limited, Indonesia
- Pendopo Energi Batubara - Indonesia
- Globalindo Alam Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- Aditya Birla Group - India
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- Thiess Contractors Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Parliament of New Zealand
- Coastal Gujarat Power Limited - India
- Maheswari Brothers Coal Limited - India
- European Bulk Services B.V. - Netherlands
- India Bulls Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Chamber of Mines of South Africa
- Parry Sugars Refinery, India
- Siam City Cement - Thailand
- Port Waratah Coal Services - Australia
- SN Aboitiz Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cement Manufacturers Association - India
- Malabar Cements Ltd - India
- Heidelberg Cement - Germany
- Australian Coal Association
- Rashtriya Ispat Nigam Limited - India
- VISA Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Tata Chemicals Ltd - India
- Kobexindo Tractors - Indoneisa
- SMC Global Power, Philippines
- Bhoruka Overseas - Indonesia
- PNOC Exploration Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Star Paper Mills Limited - India
- Billiton Holdings Pty Ltd - Australia
- Meralco Power Generation, Philippines
- Riau Bara Harum - Indonesia
- The Treasury - Australian Government
- Ministry of Transport, Egypt
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- Agrawal Coal Company - India
- Electricity Authority, New Zealand
- Global Business Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- ASAPP Information Group - India
- Bukit Makmur.PT - Indonesia
- Indonesian Coal Mining Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- IHS Mccloskey Coal Group - USA
- Chettinad Cement Corporation Ltd - India
- London Commodity Brokers - England
- Toyota Tsusho Corporation, Japan
- Therma Luzon, Inc, Philippines
- Uttam Galva Steels Limited - India
- Coalindo Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Goldman Sachs - Singapore
- Borneo Indobara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Vizag Seaport Private Limited - India
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Timah Investasi Mineral - Indoneisa
- Deloitte Consulting - India
- Wood Mackenzie - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Medco Energi Mining Internasional
- Dalmia Cement Bharat India
- The University of Queensland
- White Energy Company Limited
- Karaikal Port Pvt Ltd - India
- Wilmar Investment Holdings
- MS Steel International - UAE
- Kumho Petrochemical, South Korea
- Price Waterhouse Coopers - Russia
- Eastern Coal Council - USA
- ICICI Bank Limited - India
- Orica Australia Pty. Ltd.
- IEA Clean Coal Centre - UK
- The State Trading Corporation of India Ltd
- International Coal Ventures Pvt Ltd - India
- Attock Cement Pakistan Limited
- Economic Council, Georgia
- Iligan Light & Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Minerals Council of Australia
- Baramulti Group, Indonesia
- Banpu Public Company Limited - Thailand
- Larsen & Toubro Limited - India
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Kalimantan Lumbung Energi - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GVK Power & Infra Limited - India
- Alfred C Toepfer International GmbH - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asmin Koalindo Tuhup - Indonesia
- Global Coal Blending Company Limited - Australia
- Madhucon Powers Ltd - India
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- Mercuria Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Rio Tinto Coal - Australia
- Trasteel International SA, Italy
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Thai Mozambique Logistica
- Edison Trading Spa - Italy
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- SMG Consultants - Indonesia
- GAC Shipping (India) Pvt Ltd
- Sinarmas Energy and Mining - Indonesia
- Singapore Mercantile Exchange
- Kepco SPC Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- CNBM International Corporation - China
- Central Java Power - Indonesia
- Posco Energy - South Korea
- Kideco Jaya Agung - Indonesia
- Renaissance Capital - South Africa
- Videocon Industries ltd - India
- Tamil Nadu electricity Board
- Makarim & Taira - Indonesia
- Interocean Group of Companies - India
- Oldendorff Carriers - Singapore
- Power Finance Corporation Ltd., India
- Romanian Commodities Exchange
- Essar Steel Hazira Ltd - India
- Bharathi Cement Corporation - India
- Kartika Selabumi Mining - Indonesia
- Mercator Lines Limited - India
- Ministry of Mines - Canada
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Central Electricity Authority - India
- Eastern Energy - Thailand
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- Metalloyd Limited - United Kingdom
- Indika Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Petron Corporation, Philippines
- Independent Power Producers Association of India
- PTC India Limited - India
- McConnell Dowell - Australia
- TeaM Sual Corporation - Philippines
- Simpson Spence & Young - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Holcim Trading Pte Ltd - Singapore
- New Zealand Coal & Carbon
- Intertek Mineral Services - Indonesia
- Directorate Of Revenue Intelligence - India
- Anglo American - United Kingdom
- Sarangani Energy Corporation, Philippines
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