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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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Thursday, 01 March 12
INDO-INDIA, LARGE ECO SUPRA CAN FETCH CLOSE TO USD 9K DOP N.CHINA - FEARNLEYS AS
Handy
The Atlantic Handysize market did not see any signs for recovery this week. It is still a major lack of spot cargoes and an oversupply of pro ...
Wednesday, 29 February 12
69 MINERS AGREE TO RENEGOTIATE CONTRACTS - THE JAKARTA POST
The Jakarta Post, one of the leading English news papaer in Indonesia reported that, as many as 60 coal contracts-of-work (PKP2B) and nine non-coal ...
Wednesday, 29 February 12
PUTTING COAL GASIFICATION TO WORK
Clifford Reese of the SSOE Group looks at practical solutions for district energy leaders who wish to implement clean coal technology.
Coal fuels ...
Monday, 27 February 12
COAL MINING PROFITS TOO HIGH, SAYS GOVT - TEMPO INTERACTIVE
Tempo Interactive reported that, Energy and Mineral Resources Deputy Minister of Indonesia Widjajono Partowidagdo has criticized coal-mining compani ...
Monday, 27 February 12
INDONESIAN COAL EXPORTS TO CHINA DROPS 39.76 PERCENT IN JANUARY 2012
COALspot.com: Indonesia, the world largest coal exporter, shipped 28.21* mln mt of coal in January 2012, slightly lower than its December 2011 ...
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- Timah Investasi Mineral - Indoneisa
- Jindal Steel & Power Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Uttam Galva Steels Limited - India
- Sojitz Corporation - Japan
- Kepco SPC Power Corporation, Philippines
- Agrawal Coal Company - India
- Sarangani Energy Corporation, Philippines
- Parry Sugars Refinery, India
- Central Electricity Authority - India
- Xindia Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Bayan Resources Tbk. - Indonesia
- Therma Luzon, Inc, Philippines
- PowerSource Philippines DevCo
- Kohat Cement Company Ltd. - Pakistan
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- Coalindo Energy - Indonesia
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Neyveli Lignite Corporation Ltd, - India
- Bukit Asam (Persero) Tbk - Indonesia
- Vizag Seaport Private Limited - India
- IHS Mccloskey Coal Group - USA
- GN Power Mariveles Coal Plant, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- ICICI Bank Limited - India
- Edison Trading Spa - Italy
- Essar Steel Hazira Ltd - India
- Siam City Cement PLC, Thailand
- Independent Power Producers Association of India
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Wilmar Investment Holdings
- Global Coal Blending Company Limited - Australia
- Toyota Tsusho Corporation, Japan
- Port Waratah Coal Services - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Deloitte Consulting - India
- Cigading International Bulk Terminal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- OPG Power Generation Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- Salva Resources Pvt Ltd - India
- The Treasury - Australian Government
- Globalindo Alam Lestari - Indonesia
- Goldman Sachs - Singapore
- Electricity Generating Authority of Thailand
- Ministry of Transport, Egypt
- Bahari Cakrawala Sebuku - Indonesia
- Savvy Resources Ltd - HongKong
- Mercuria Energy - Indonesia
- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Ministry of Mines - Canada
- Kumho Petrochemical, South Korea
- Standard Chartered Bank - UAE
- Merrill Lynch Commodities Europe
- Australian Coal Association
- Romanian Commodities Exchange
- Lanco Infratech Ltd - India
- Economic Council, Georgia
- Aditya Birla Group - India
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Kobexindo Tractors - Indoneisa
- Electricity Authority, New Zealand
- Gujarat Sidhee Cement - India
- Chettinad Cement Corporation Ltd - India
- Jaiprakash Power Ventures ltd
- Borneo Indobara - Indonesia
- Mercator Lines Limited - India
- Star Paper Mills Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Minerals Council of Australia
- Coastal Gujarat Power Limited - India
- Barasentosa Lestari - Indonesia
- Africa Commodities Group - South Africa
- Samtan Co., Ltd - South Korea
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- VISA Power Limited - India
- Kaltim Prima Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Tata Chemicals Ltd - India
- Commonwealth Bank - Australia
- Bharathi Cement Corporation - India
- Bangladesh Power Developement Board
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Indonesian Coal Mining Association
- Price Waterhouse Coopers - Russia
- Indian Oil Corporation Limited
- Leighton Contractors Pty Ltd - Australia
- Billiton Holdings Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Marubeni Corporation - India
- Semirara Mining Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Kartika Selabumi Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Australian Commodity Traders Exchange
- Rio Tinto Coal - Australia
- Bukit Makmur.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Larsen & Toubro Limited - India
- Latin American Coal - Colombia
- Directorate Of Revenue Intelligence - India
- Wood Mackenzie - Singapore
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- SMG Consultants - Indonesia
- Mintek Dendrill Indonesia
- Central Java Power - Indonesia
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Banpu Public Company Limited - Thailand
- Bulk Trading Sa - Switzerland
- Altura Mining Limited, Indonesia
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Miang Besar Coal Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ind-Barath Power Infra Limited - India
- Videocon Industries ltd - India
- GAC Shipping (India) Pvt Ltd
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- CNBM International Corporation - China
- Mjunction Services Limited - India
- Heidelberg Cement - Germany
- Jorong Barutama Greston.PT - Indonesia
- Orica Mining Services - Indonesia
- Planning Commission, India
- McConnell Dowell - Australia
- ASAPP Information Group - India
- PNOC Exploration Corporation - Philippines
- Trasteel International SA, Italy
- GMR Energy Limited - India
- Cement Manufacturers Association - India
- Eastern Energy - Thailand
- Sindya Power Generating Company Private Ltd
- Posco Energy - South Korea
- Carbofer General Trading SA - India
- Metalloyd Limited - United Kingdom
- Bukit Baiduri Energy - Indonesia
- Sical Logistics Limited - India
- International Coal Ventures Pvt Ltd - India
- Renaissance Capital - South Africa
- Attock Cement Pakistan Limited
- Binh Thuan Hamico - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vijayanagar Sugar Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Global Business Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Global Green Power PLC Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dalmia Cement Bharat India
- Energy Link Ltd, New Zealand
- Chamber of Mines of South Africa
- Bhatia International Limited - India
- Grasim Industreis Ltd - India
- Karaikal Port Pvt Ltd - India
- SMC Global Power, Philippines
- CIMB Investment Bank - Malaysia
- India Bulls Power Limited - India
- Manunggal Multi Energi - Indonesia
- Petron Corporation, Philippines
- The University of Queensland
- Georgia Ports Authority, United States
- Pendopo Energi Batubara - Indonesia
- Coal and Oil Company - UAE
- Singapore Mercantile Exchange
- Madhucon Powers Ltd - India
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- New Zealand Coal & Carbon
- Vedanta Resources Plc - India
- Rashtriya Ispat Nigam Limited - India
- Baramulti Group, Indonesia
- PTC India Limited - India
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Ambuja Cements Ltd - India
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Straits Asia Resources Limited - Singapore
- Thiess Contractors Indonesia
- Riau Bara Harum - Indonesia
- Simpson Spence & Young - Indonesia
- Thai Mozambique Logistica
- Orica Australia Pty. Ltd.
- Malabar Cements Ltd - India
- Parliament of New Zealand
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