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Monday, 26 March 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
 The Baltic Dry Index follows its upward incline for fourth consecutive week by rising to more than 900 points, up by 37% from the bottom low in the last 26 years of 662 points on February 2nd. Smaller vessel categories, supramax and panamax, are moving higher due to strong fixture activity in both the Atlantic and Pacific basins with capesizes being still under serious pain from hefty overtonnage and fragile Chinese iron ore import market sentiment. Overall, all vessel indices ended in green, apart from capesizes, with supramax and handysize units experiencing the sharpest gain, near to 9% in contrast with a 6.7% rise in the panamax and 6.6% fall in the capesize segment.
The first quarter of the year is about to end with capesize average time charter earnings falling below $5,000/day, while supramax vessels are earning more than $10,000/day and panamax are trading at almost the same levels with handysizes, more than $8,000/day. The BDI seems that will break the psyclological barrier of 1,000 points in the second quarter of the year as it regains strength from the firm demand for coal, grain and minor bulk cargoes. In terms of coal demand, the prospects are overwhelming for Chinese demand as China imported approximately 20.55 million tons of coal in February, 850,000 tons (4%) more than imported in January and an amazing 204% increase from February 2011 levels.
Capesize vessels seem that will suffer for a longer period of time as Chinese inventories remain hefty, despite their fall to 99,4 million tons, 500,000 tons less than a week ago. In addition, China’s government announcement for an economic growth of less than 8% in 2012 pours more uncertainty in the already volatile iron ore market for the massive buying power of the world’s largest iron ore consumer. BHP Billiton is predicting that the growth of seaborne iron trade will amount to little more than 4.4% over the course of this decade, nearly half the 8.4% growth figure achieved between 2000 and 2010.
One positive sign is that China’s daily crude steel output stood at 1,898 million tones for the first ten days of March, surging 13% from the preceding period, according to data from the China Iron & Steel Association. Steel demand has started to pick up in the world’s top consumer during March amid a gradual recovery in construction activity, but buyers remain wary about a slowdown in economic growth, which may continue to weigh on the steel sector. “Steel demand is warming up as more construction projects resume, but it is still weaker than the corresponding period of last year,” said a steel trader in Beijing.
Fears for the negative impact of last week’s tropical cyclone on the capesize segment have gone as shipping operations at the major Australia’s Port Hedland have now resumed. However, capesize vessels lost more ground this week with average time charter earrings falling to the lowest levels for over a year. The BCI has lost 97 points on a weekly basis by standing at 1,369 points, 6.6% down from previous week’s closing with vessels trading at levels of $$4,546/day, when last year were earning more than $10,000/day. Capesize spot rates on Australia to China have dropped to $7.45 per tonne, which shows a return of about $1,500/day for 180,000 dwt tons capesize vessel.
In the panamax segment, South American grain demand remains the key driver force, with BPI posting a 6.7% rise by gaining 65 points more than previous week and vessel earnings moving to more than $8,000/day. But, panamax earnings are still far below than last year’s levels, when there were more than $16,000/day, as they are facing the same headache with capesize vessels, the pain of oversupply.
Supramax and handysize units are on the spotlight as being the star performers from March 2nd by showing continuous weekly increases. The BSI ended at 1035 points last Friday, showing a 39% rise from the beginning of March with vessels earning more than $10,000/day, 35% lower than last year’s levels. The BHSI ended at 551 points, 26% up from the beginning of March with vessels earning more than $8,000/day, 29% less than last year.
Amid the volatile Chinese iron ore import market sentiment and the negative forecasts for a slow Chinese economic growth, Australia expects to produce record tonnages of iron ore through much of the decade, nearly all of which will be used to manufacture steel in demand. Australia iron ore exports are estimated to increase by more than 50 percent by 2016/17 compared with last year. Government data release anticipates still strong demand from Chinese steel mills, the biggest buyers. Exports will rise by an annual rate of around 11 percent to reach 767 m million tonnes in 2016/17, the Bureau of Resources and Energy Economics (BREE) predicted.
Rio Tinto, the world’s second largest iron ore producer, said that it plans to boost the output from its mines in Australia western Pilbara to 283 million tonnes per year by the second half of 2013, up from the current 225 million tonnes. David Joyce, managing director of expansion projects, said that although the rate of GDP growth in China is slowing, they remain confident on the basis of the figures that they have seen for a solid growth this year. A positive development for the fate of capesize operators is that Chinese steel demand has started to pick up amid a gradual recovery in construction activity.
Although the negative sentiment that currently persists in Chinese iron ore market, with worries for a long last recession in the world’s largest consumer country, big miners are betting on a soft landing for the world’s second biggest economy. It is believed that China’s import demand would continue to grow over the next several years, albeit at a slower pace, which should be enough reason for commodity producers to continue their expansion plans. “Nobody is saying that demand growth in China for iron ore is going to go away, just that growth rates will not be as high as they were,” said Mike Young, managing director of BC Iron, which relies on sales to China for all its revenue. Furthermore, recent investigations by Raw Materials Group revealed that global iron ore demand is set to double to around 3.5 billion tones per year by 2030, with Chinese appetite for the commodity continuing to drive the market, albeit at a slower pace than during the last decade.
Source: Maria Bertzeletou, Hellenic Shipping
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Friday, 04 May 12
DEMOLITION KEY FOR DRY BULK MARKET RECOVERY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The overflow of newbuilding vessels which “spilled over” into 2012 from 2011 brought the dry bulk market to a near collapse level at the ...
Thursday, 03 May 12
DRY BULK MARKET REMAINS INACTIVE, POSTING MILD DECREASE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept retreating this week, although at a very low pace, on the back of a lull in demand. The industry's benchmark, th ...
Thursday, 03 May 12
MINERS DEMAND LEGAL CERTAINTY ON PRE-BAN INTERIM POLICY - THE JAKARTA POST
The Jakarta Post reported that, Mining companies represented by the Indonesian Mining Association (IMA) welcomed the government’s plan to impo ...
Thursday, 03 May 12
HANDY EAST COAST INDIA - CHINA AROUND USD 7000 - FEARNLEYS AS
Handy - Stable demand in the Atlantic offered good rates for the tonnage.
USG/Cont was worth USD 17500 and more. Baltic and Black Sea appeared to ...
Wednesday, 02 May 12
CHINA BLACKOUTS HIGHLIGHT PRICING POLICY WEAKNESS - FITCH
Fitch reported that, the likelihood of further electricity blackouts in China this summer underlines Fitch's view of the basic problem f ...
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- Antam Resourcindo - Indonesia
- Simpson Spence & Young - Indonesia
- Central Java Power - Indonesia
- Formosa Plastics Group - Taiwan
- Videocon Industries ltd - India
- Rio Tinto Coal - Australia
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Bhoruka Overseas - Indonesia
- Gujarat Sidhee Cement - India
- Karaikal Port Pvt Ltd - India
- Xindia Steels Limited - India
- Larsen & Toubro Limited - India
- Sarangani Energy Corporation, Philippines
- Heidelberg Cement - Germany
- Dalmia Cement Bharat India
- Bukit Asam (Persero) Tbk - Indonesia
- McConnell Dowell - Australia
- Cigading International Bulk Terminal - Indonesia
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
- Borneo Indobara - Indonesia
- Straits Asia Resources Limited - Singapore
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Sojitz Corporation - Japan
- Sakthi Sugars Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining Corp, Philippines
- Vizag Seaport Private Limited - India
- Energy Link Ltd, New Zealand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Riau Bara Harum - Indonesia
- Ministry of Transport, Egypt
- Indonesian Coal Mining Association
- Kapuas Tunggal Persada - Indonesia
- GMR Energy Limited - India
- Tamil Nadu electricity Board
- Eastern Energy - Thailand
- Maheswari Brothers Coal Limited - India
- Electricity Authority, New Zealand
- Kepco SPC Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- India Bulls Power Limited - India
- Economic Council, Georgia
- Samtan Co., Ltd - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Maharashtra Electricity Regulatory Commission - India
- Merrill Lynch Commodities Europe
- Rashtriya Ispat Nigam Limited - India
- Globalindo Alam Lestari - Indonesia
- Intertek Mineral Services - Indonesia
- Siam City Cement PLC, Thailand
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Central Electricity Authority - India
- Ind-Barath Power Infra Limited - India
- White Energy Company Limited
- Vijayanagar Sugar Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- Port Waratah Coal Services - Australia
- Makarim & Taira - Indonesia
- Australian Coal Association
- European Bulk Services B.V. - Netherlands
- Savvy Resources Ltd - HongKong
- Bukit Makmur.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Ministry of Finance - Indonesia
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- GAC Shipping (India) Pvt Ltd
- Therma Luzon, Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- South Luzon Thermal Energy Corporation
- Independent Power Producers Association of India
- Edison Trading Spa - Italy
- Global Green Power PLC Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Mines - Canada
- Parliament of New Zealand
- Bank of Tokyo Mitsubishi UFJ Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Aditya Birla Group - India
- PTC India Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- The Treasury - Australian Government
- Commonwealth Bank - Australia
- Indian Energy Exchange, India
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Bukit Baiduri Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kartika Selabumi Mining - Indonesia
- Altura Mining Limited, Indonesia
- Sree Jayajothi Cements Limited - India
- Deloitte Consulting - India
- Bangladesh Power Developement Board
- Thai Mozambique Logistica
- Price Waterhouse Coopers - Russia
- Bayan Resources Tbk. - Indonesia
- Mercuria Energy - Indonesia
- New Zealand Coal & Carbon
- Binh Thuan Hamico - Vietnam
- IEA Clean Coal Centre - UK
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Australian Commodity Traders Exchange
- ICICI Bank Limited - India
- GVK Power & Infra Limited - India
- The State Trading Corporation of India Ltd
- Coal and Oil Company - UAE
- AsiaOL BioFuels Corp., Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Barasentosa Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- Essar Steel Hazira Ltd - India
- SMC Global Power, Philippines
- Grasim Industreis Ltd - India
- CNBM International Corporation - China
- Romanian Commodities Exchange
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- LBH Netherlands Bv - Netherlands
- Jindal Steel & Power Ltd - India
- Latin American Coal - Colombia
- Krishnapatnam Port Company Ltd. - India
- Bulk Trading Sa - Switzerland
- Semirara Mining and Power Corporation, Philippines
- Vedanta Resources Plc - India
- Africa Commodities Group - South Africa
- ASAPP Information Group - India
- Siam City Cement - Thailand
- PNOC Exploration Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Star Paper Mills Limited - India
- Uttam Galva Steels Limited - India
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Indian Oil Corporation Limited
- London Commodity Brokers - England
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- IHS Mccloskey Coal Group - USA
- Planning Commission, India
- Baramulti Group, Indonesia
- San Jose City I Power Corp, Philippines
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Metalloyd Limited - United Kingdom
- Billiton Holdings Pty Ltd - Australia
- The University of Queensland
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Pendopo Energi Batubara - Indonesia
- Indo Tambangraya Megah - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Global Coal Blending Company Limited - Australia
- Mintek Dendrill Indonesia
- Jaiprakash Power Ventures ltd
- Carbofer General Trading SA - India
- Sical Logistics Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Timah Investasi Mineral - Indoneisa
- Marubeni Corporation - India
- Bhatia International Limited - India
- Malabar Cements Ltd - India
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- Tata Chemicals Ltd - India
- Chettinad Cement Corporation Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kumho Petrochemical, South Korea
- PowerSource Philippines DevCo
- MS Steel International - UAE
- Indika Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- SMG Consultants - Indonesia
- Renaissance Capital - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Holcim Trading Pte Ltd - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Parry Sugars Refinery, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Anglo American - United Kingdom
- Karbindo Abesyapradhi - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Agrawal Coal Company - India
- Bharathi Cement Corporation - India
- OPG Power Generation Pvt Ltd - India
- Indogreen Group - Indonesia
- Ambuja Cements Ltd - India
- Goldman Sachs - Singapore
- Energy Development Corp, Philippines
- Wood Mackenzie - Singapore
- Bhushan Steel Limited - India
- Power Finance Corporation Ltd., India
- Posco Energy - South Korea
- SN Aboitiz Power Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Global Business Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Standard Chartered Bank - UAE
- Mercator Lines Limited - India
- CIMB Investment Bank - Malaysia
- Minerals Council of Australia
- Iligan Light & Power Inc, Philippines
- Interocean Group of Companies - India
- Meenaskhi Energy Private Limited - India
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