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Monday, 02 April 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
 The first quarter of the New Year ended with the BDI standing 42% above from the 26 years’ bottom low of 662 points on February 1st, and a positive note for the dry bulk shipping environment. The capesize segment is still distrustful, but industry players are seeing in a stronger Chinese iron ore demand as we move towards April and Chinese steel mills are resuming their production. According to data from the China Iron Ore & Steel Association, China’s crude steel output rose 1.1% in the second ten days of March, 11-20, from the preceding period, standing at 1,919 million tones from 1,898 million tones in the previous ten days.
Brazil’s Vale, the world’s second largest mining company, shares the same view with its Australian rivals, Rio Tinto and BHP Billiton for a moderate Chinese iron ore demand holding an optimistic position given the large steel production capacity of China. Vale forecasts that steel output in China will grow 5% this year after expanding more than 10% a year ago. One more positive sign is that Chinese February iron ore imports improved, after a weak January, totaled 65.0mt, up 10% m-o-m and 33% y-o-y, while Chinese iron ore inventories are falling for a second consecutive week to less than 100million tons.
In terms of vessels earnings, supramax and panamax segment show a stronger picture than capesizes, whose average time charter earnings are still floating below $5,500/day. Strong South American grain demand and an increase in coal exports from U.S. and Europe provide a firmer support in the panamax market with earnings almost 40% more than capesize vessels, while supramax vessels are trading at levels 108% higher than capesize and 28% than panamax earnings. However, heavy rains in Eastern Australia led to a temporary operating suspension at several coal mines resulting in slower Australian coal fixture volumes that may have an impact on the vessel earnings of smaller vessel sizes, panamax and supramax.
During the last week of March the BDI ended again in green, following its constant small rise from February 10th, by gaining at an average 36 points per week, and standing one breath from breaking the psychological barrier of 1,000 points mark
The index closed on Friday 30th March, at 934 points, down by 2.4% from last week’s closing and down by 39% from a similar week closing in 2011 when it was 1,520 points. The BSI showed a soft decline of 0.48% after 5 weeks of consecutive gains, while the BCI posted the strongest performance this week with a 3% rise. The BCI gained 43 points by closing at 1412 with vessels earnings rising to $5,188/day, $3,384/day less than handysizes, showing an increase of $642/day on a weekly basis. At similar week in 2011, capesizes were earning $10,554/day, when supramax and panamax average time charter earnings are floating at levels more than $15,000/day.
In the panamax segment, the BPI rose to 1051 points from 1036 last week, 1,45% up, with vessel earnings still floating at levels below $9,000/day, while supramax vessels persist to show the most solid performance with earnings more than $10,000/day. Handysize units are trading at levels similar with panamax by earning $8,572/day, when at similar week in 2011 handysize vessels were earning more than $11,000/day.
The last week of March ends with some interesting news that reshapes the dry bulk shipping environment. Brazil’s Vale senior executive stated in Reuters that it expects to win permission within months to unload its very large ore carriers at Chinese ports, a move that will ensure efficient delivery of raw materials to China’s growing economy. The ships, known as very large ore carriers, or "Valemax" class vessels, are needed to meet soaring demand for iron ore, the main ingredient in steel, Tito Martins, Vale's CFO, said in an interview at the Reuters Global Mining and Metals Summit. China's economy expanded by $2-trillion in the last decade as growth averaged about 11%, he said. In the next decade, he predicted, it will expand by $4- trillion, even if growth slows by more than a third. "Even if they grow at 7%, taking into account the size of the gross domestic production today, this growth in the next five to 10 years will be much bigger than before”, he said.
"A slowdown in China doesn't necessarily mean a recession," Martins said, adding that the steel business has been growing at rates faster than the overall economy. He said that Iron ore prices are likely to remain above $120/ton in the next several years because demand remains strong and at prices below that, Chinese producers of low quality ore begin to lose money. "The $100 to $120 a ton level is a level where many marginal producers start having difficulty. He also mentioned that Vale needs the very large ore carriers to compete with Australian ore producers such as BHP Billiton and Rio Tinto, which are closer to China and pay about half the transport fees to move their product to the world's largest ore market as Brazilian producers do. The first of the 400 000-deadweight-tonne Valemaxes began operating late last year. Vale hopes to build 35 by the end of 2013, at a cost of about $4.2 billion.
One more outstanding of this week's developments was the news for Rio Tinto’s joining in the new trading mechanism launched by the China Beijing International Mining Exchange (CBMX), as a second foreign miner after Australia’s Fortescue Metals Group. "We welcome the development of CBMX as it gives us a new option for selling any available tonnes to China, over and above those already contracted," Rio's iron ore president for Asia, Alan Smith, said in a statement on Friday. Brazilian miner Vale SA also signed a memorandum of understanding with CBMX as it pledged to support the electronic trading platform, the exchange said in a statement. The trading platform, which provides a domestic rival to the Global Ore trading exchange backed by mining giant BHP Billiton , will start official trading on May 8. China, the world's top iron ore buyer,which consumes around 60 percent of global seaborne ore, hopes the exchange will help the country to gain more pricing control and also reduce speculation and manipulation in the spot market. Chinese mills including Baosteel, Hebei Steel, Wuhan Steel, Shougang and Angang as well as large iron ore traders China Minmetals and Sinosteel have joined the new iron ore trading network.
As we move in the second quarter of the year dry bulk freight rates are expected to remain weak as Chinese iron ore inventories are still escalating with some signs for a stronger Chinese iron ore demand from expectations for a rebound in Chinese steel production. Upcoming prospects for thermal coal demand remain very promising with estimations for a surge in thermal coal fixture volume by the end of April due to maintenance in the Daqin railway and a seasonal restocking for peak summer demand season. The dry bulk fleet continues to expand and the shipments of iron ore, a raw material for steel, which account for around a third of seaborne volumes for capesize vessels, will be the main key force along with Chinese steel demand for an upturn of the dry freight market at levels more comforting than the current pessimistic outlook.
Source: Maria Bertzeletou, Hellenic Shipping
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Tuesday, 01 May 12
VIETNAM FEARS IT MAY NOT SEEK COAL SUPPLIES - TBKTSG / VIETNAMNET BRIDGE
TBKTSG / VietNamNet Bridge reported that, with five coal-run thermopower plants under construction, PetroVietnam alone would need 18 million tons of ...
Sunday, 29 April 12
THE FREIGHT MARKET EXPECTED TO BE STEADY NEXT WEEK - VISTAAR
COALspot.com - The BDI continued to go up with the support of Panamax/Supramax and was up by 8.34 pct closing at 1,156 points.
The cape index was ...
Sunday, 29 April 12
INDONESIAN SUB-BITUMINOUS COAL SWAPS FOR MAY 2012 DELIVERY WAS STABLE THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps for May deliveries stable this week, according to DSP of SGX AsiaClear OTC Coal Swaps. In the me ...
Friday, 27 April 12
BUKIT ASAMS NET INCOME UP 14% IN 1Q 2012 (UNAUDITED)
Press Release - PT Bukit Asam (Persero) Tbk, announced the Consolidated Financial Statements and Subsidiaries per 31 March 2012 (Unaudited).
Reve ...
Thursday, 26 April 12
AUSTRALIAS COKAL EXPANDS MET COAL POTENTIAL INTO WEST KALIMANTAN
COALspot.com - Global metallurgical coal group Cokal Limited (Cokal) (ASX:CKA) announced today it has completed the acquisition of 75.2% of PT Silan ...
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- Kobexindo Tractors - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- SMG Consultants - Indonesia
- Siam City Cement PLC, Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Energy - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Jindal Steel & Power Ltd - India
- Globalindo Alam Lestari - Indonesia
- Anglo American - United Kingdom
- Karaikal Port Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Sakthi Sugars Limited - India
- Riau Bara Harum - Indonesia
- Bharathi Cement Corporation - India
- Uttam Galva Steels Limited - India
- Therma Luzon, Inc, Philippines
- Bhatia International Limited - India
- India Bulls Power Limited - India
- GMR Energy Limited - India
- Gujarat Electricity Regulatory Commission - India
- Simpson Spence & Young - Indonesia
- Baramulti Group, Indonesia
- Semirara Mining Corp, Philippines
- Ministry of Mines - Canada
- Jaiprakash Power Ventures ltd
- Global Coal Blending Company Limited - Australia
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Savvy Resources Ltd - HongKong
- Indogreen Group - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- Australian Coal Association
- Indika Energy - Indonesia
- Gujarat Sidhee Cement - India
- Intertek Mineral Services - Indonesia
- Bhoruka Overseas - Indonesia
- Formosa Plastics Group - Taiwan
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Tamil Nadu electricity Board
- Bulk Trading Sa - Switzerland
- Energy Link Ltd, New Zealand
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Barasentosa Lestari - Indonesia
- Port Waratah Coal Services - Australia
- International Coal Ventures Pvt Ltd - India
- Medco Energi Mining Internasional
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMC Global Power, Philippines
- PNOC Exploration Corporation - Philippines
- Parry Sugars Refinery, India
- Coalindo Energy - Indonesia
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- Cement Manufacturers Association - India
- Central Java Power - Indonesia
- Carbofer General Trading SA - India
- Central Electricity Authority - India
- Sarangani Energy Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Commonwealth Bank - Australia
- Mjunction Services Limited - India
- Goldman Sachs - Singapore
- Oldendorff Carriers - Singapore
- Africa Commodities Group - South Africa
- Rio Tinto Coal - Australia
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- SN Aboitiz Power Inc, Philippines
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- OPG Power Generation Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Price Waterhouse Coopers - Russia
- Indonesian Coal Mining Association
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- Vedanta Resources Plc - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kumho Petrochemical, South Korea
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- Krishnapatnam Port Company Ltd. - India
- Altura Mining Limited, Indonesia
- Banpu Public Company Limited - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Deloitte Consulting - India
- Petrochimia International Co. Ltd.- Taiwan
- The University of Queensland
- Siam City Cement - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Xindia Steels Limited - India
- Sical Logistics Limited - India
- VISA Power Limited - India
- Trasteel International SA, Italy
- Kartika Selabumi Mining - Indonesia
- Borneo Indobara - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indo Tambangraya Megah - Indonesia
- MS Steel International - UAE
- PetroVietnam Power Coal Import and Supply Company
- Ind-Barath Power Infra Limited - India
- Kapuas Tunggal Persada - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Heidelberg Cement - Germany
- Australian Commodity Traders Exchange
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- IEA Clean Coal Centre - UK
- Bukit Baiduri Energy - Indonesia
- Indian Oil Corporation Limited
- Alfred C Toepfer International GmbH - Germany
- Chettinad Cement Corporation Ltd - India
- Antam Resourcindo - Indonesia
- New Zealand Coal & Carbon
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- Directorate Of Revenue Intelligence - India
- Standard Chartered Bank - UAE
- Kepco SPC Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Sree Jayajothi Cements Limited - India
- Global Business Power Corporation, Philippines
- Eastern Coal Council - USA
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- San Jose City I Power Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- Vizag Seaport Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Petron Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- TeaM Sual Corporation - Philippines
- Thiess Contractors Indonesia
- Meenaskhi Energy Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Aboitiz Power Corporation - Philippines
- Electricity Generating Authority of Thailand
- CIMB Investment Bank - Malaysia
- Marubeni Corporation - India
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Grasim Industreis Ltd - India
- Georgia Ports Authority, United States
- Bayan Resources Tbk. - Indonesia
- Ministry of Transport, Egypt
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- London Commodity Brokers - England
- Salva Resources Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Latin American Coal - Colombia
- Bhushan Steel Limited - India
- Ambuja Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Madhucon Powers Ltd - India
- Orica Australia Pty. Ltd.
- Iligan Light & Power Inc, Philippines
- Planning Commission, India
- White Energy Company Limited
- Kalimantan Lumbung Energi - Indonesia
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Economic Council, Georgia
- Energy Development Corp, Philippines
- GVK Power & Infra Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Lanco Infratech Ltd - India
- Wilmar Investment Holdings
- AsiaOL BioFuels Corp., Philippines
- Maharashtra Electricity Regulatory Commission - India
- Mercator Lines Limited - India
- Cigading International Bulk Terminal - Indonesia
- Interocean Group of Companies - India
- McConnell Dowell - Australia
- Attock Cement Pakistan Limited
- Minerals Council of Australia
- Dalmia Cement Bharat India
- Romanian Commodities Exchange
- GN Power Mariveles Coal Plant, Philippines
- Merrill Lynch Commodities Europe
- Malabar Cements Ltd - India
- Independent Power Producers Association of India
- Videocon Industries ltd - India
- Renaissance Capital - South Africa
- Mintek Dendrill Indonesia
- Ministry of Finance - Indonesia
- Power Finance Corporation Ltd., India
- Straits Asia Resources Limited - Singapore
- Star Paper Mills Limited - India
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bukit Makmur.PT - Indonesia
- Kideco Jaya Agung - Indonesia
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