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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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Tuesday, 31 January 12
THERE ARE MANY GOOD REASONS FOR COAL IN GERMANY - DR CIESLIK
COALspot.com - "The year 2011 was again marked by many changes on the markets and energy policies, at times in line with expectations, but at o ...
Tuesday, 31 January 12
DRY BULK MARKET KEEPS FALLING FOR WORST MONTH IN YEARS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market didn't manage to put a halt in its downfall, with the industry's benchmark, the BDI (Baltic Dry Index), posting yet another fa ...
Monday, 30 January 12
CHINA'S HUNGER FOR COAL LEAVES DENT IN PENNSYLVANIA'S SUPPLY - THOMAS LESKIN
With the price of heating oil on the rise, one of Pennsylvania's greatest natural resources - coal - is in high demand, and not just locally.
Et ...
Saturday, 28 January 12
WILL FREIGHT MARKET STABILIZE FROM NEXT WEEK?
COALspot.com - The markets continued to soften with BDI at 663 points down by 15.78 pct closing at 726 points and cape index was down by 5.73 pct cl ...
Friday, 27 January 12
DEMOLITION ACTIVITY NEEDS TO INCREASE SIGNIFICANTLY THIS YEAR AS WELL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The oversupply of vessels in most shipping sectors is so intense that it’s become clear to ship owners that unless they scrap as many of their ...
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- Antam Resourcindo - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Africa Commodities Group - South Africa
- Meenaskhi Energy Private Limited - India
- Xindia Steels Limited - India
- Miang Besar Coal Terminal - Indonesia
- Dalmia Cement Bharat India
- Orica Australia Pty. Ltd.
- Global Coal Blending Company Limited - Australia
- Semirara Mining and Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Vedanta Resources Plc - India
- Gujarat Mineral Development Corp Ltd - India
- OPG Power Generation Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CIMB Investment Bank - Malaysia
- LBH Netherlands Bv - Netherlands
- Interocean Group of Companies - India
- Binh Thuan Hamico - Vietnam
- Orica Mining Services - Indonesia
- Australian Coal Association
- Madhucon Powers Ltd - India
- Manunggal Multi Energi - Indonesia
- ICICI Bank Limited - India
- New Zealand Coal & Carbon
- Kumho Petrochemical, South Korea
- TeaM Sual Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Port Waratah Coal Services - Australia
- Maheswari Brothers Coal Limited - India
- Larsen & Toubro Limited - India
- Sree Jayajothi Cements Limited - India
- The Treasury - Australian Government
- San Jose City I Power Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Romanian Commodities Exchange
- ASAPP Information Group - India
- Alfred C Toepfer International GmbH - Germany
- PNOC Exploration Corporation - Philippines
- Petron Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Ministry of Finance - Indonesia
- Thiess Contractors Indonesia
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- Price Waterhouse Coopers - Russia
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Tamil Nadu electricity Board
- VISA Power Limited - India
- Therma Luzon, Inc, Philippines
- Malabar Cements Ltd - India
- Australian Commodity Traders Exchange
- European Bulk Services B.V. - Netherlands
- Eastern Coal Council - USA
- Commonwealth Bank - Australia
- Planning Commission, India
- Gujarat Sidhee Cement - India
- Savvy Resources Ltd - HongKong
- Ind-Barath Power Infra Limited - India
- Uttam Galva Steels Limited - India
- GMR Energy Limited - India
- AsiaOL BioFuels Corp., Philippines
- Cement Manufacturers Association - India
- Krishnapatnam Port Company Ltd. - India
- IHS Mccloskey Coal Group - USA
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Kobexindo Tractors - Indoneisa
- Grasim Industreis Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Meralco Power Generation, Philippines
- The University of Queensland
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Pendopo Energi Batubara - Indonesia
- Aditya Birla Group - India
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Oldendorff Carriers - Singapore
- Bukit Makmur.PT - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- Singapore Mercantile Exchange
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- Sojitz Corporation - Japan
- Ministry of Mines - Canada
- Kohat Cement Company Ltd. - Pakistan
- Simpson Spence & Young - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Riau Bara Harum - Indonesia
- Wood Mackenzie - Singapore
- Parliament of New Zealand
- Chettinad Cement Corporation Ltd - India
- Global Business Power Corporation, Philippines
- Edison Trading Spa - Italy
- Cigading International Bulk Terminal - Indonesia
- Bhatia International Limited - India
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- Makarim & Taira - Indonesia
- Indo Tambangraya Megah - Indonesia
- Anglo American - United Kingdom
- Central Java Power - Indonesia
- Borneo Indobara - Indonesia
- Goldman Sachs - Singapore
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Bhushan Steel Limited - India
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- Essar Steel Hazira Ltd - India
- MS Steel International - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Indogreen Group - Indonesia
- Mjunction Services Limited - India
- Ambuja Cements Ltd - India
- Altura Mining Limited, Indonesia
- Merrill Lynch Commodities Europe
- Posco Energy - South Korea
- Sical Logistics Limited - India
- Formosa Plastics Group - Taiwan
- Wilmar Investment Holdings
- Energy Development Corp, Philippines
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- Indian Energy Exchange, India
- Standard Chartered Bank - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- London Commodity Brokers - England
- Mercator Lines Limited - India
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Green Power PLC Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Globalindo Alam Lestari - Indonesia
- Agrawal Coal Company - India
- Thai Mozambique Logistica
- Mercuria Energy - Indonesia
- Independent Power Producers Association of India
- Chamber of Mines of South Africa
- Bahari Cakrawala Sebuku - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kartika Selabumi Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- GVK Power & Infra Limited - India
- Kaltim Prima Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Economic Council, Georgia
- Renaissance Capital - South Africa
- Deloitte Consulting - India
- Samtan Co., Ltd - South Korea
- Holcim Trading Pte Ltd - Singapore
- Bangladesh Power Developement Board
- PowerSource Philippines DevCo
- International Coal Ventures Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Salva Resources Pvt Ltd - India
- SMC Global Power, Philippines
- PTC India Limited - India
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- South Luzon Thermal Energy Corporation
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Mintek Dendrill Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Minerals Council of Australia
- Rashtriya Ispat Nigam Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- Medco Energi Mining Internasional
- Energy Link Ltd, New Zealand
- Baramulti Group, Indonesia
- Power Finance Corporation Ltd., India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Siam City Cement - Thailand
- Metalloyd Limited - United Kingdom
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- Central Electricity Authority - India
- Latin American Coal - Colombia
- The State Trading Corporation of India Ltd
- Neyveli Lignite Corporation Ltd, - India
- Kepco SPC Power Corporation, Philippines
- McConnell Dowell - Australia
- Carbofer General Trading SA - India
- Semirara Mining Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Bharathi Cement Corporation - India
- Electricity Generating Authority of Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- GAC Shipping (India) Pvt Ltd
- Marubeni Corporation - India
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