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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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Saturday, 17 March 12
THE FREIGHT RATES FOR INDONESIA TO INDIA REMAINED FIRM - VISTAAR SINGAPORE
COALspot.com - The market continued to be firm and all segments were up except for Cape Index which was down by 2.46 pct closing at 1,466 points.
...
Saturday, 17 March 12
INDIAN GOVT FINALIZES DRAFT BILL FOR COAL REGULATOR - PTI
The coal sector would soon get a regulator as the government has finalised a draft bill for the purpose, Coal Minister Sriprakash Jaiswal said Wedne ...
Friday, 16 March 12
THE PACIFIC MARKET IS FIRMING UP - FEARNLEYS AS
Handy
A slightly positive trend was seen last week in the Atlantic. Skaw-Passero deliveries fixed around USD 3k to US Gulf, while US Gulf deliveres ...
Thursday, 15 March 12
RAINS AVERAGE SELLING PRICE OF COAL WENT UP BY 22 % IN 2011
COALspot.com - PT. Resource Alam Indonesia Tbk, an Indonesian CCoW (3rd Generation) holder reported Wednesday a 171 percent increase in net profits ...
Thursday, 15 March 12
RESOURCE ALAM FY11 PROFIT UP 171% - INSIDER STORIES
Insider Stories reported that, coal mining company PT Resource Alam Indonesia Tbk (KKGI) reported a 171.16% jump in net profit last year on the back ...
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- Kepco SPC Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Cement Manufacturers Association - India
- Ceylon Electricity Board - Sri Lanka
- Sakthi Sugars Limited - India
- Ambuja Cements Ltd - India
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- Anglo American - United Kingdom
- GVK Power & Infra Limited - India
- Meralco Power Generation, Philippines
- Planning Commission, India
- Kaltim Prima Coal - Indonesia
- Mjunction Services Limited - India
- Attock Cement Pakistan Limited
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- International Coal Ventures Pvt Ltd - India
- New Zealand Coal & Carbon
- European Bulk Services B.V. - Netherlands
- Sical Logistics Limited - India
- Wilmar Investment Holdings
- SMG Consultants - Indonesia
- ASAPP Information Group - India
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Edison Trading Spa - Italy
- Indian Energy Exchange, India
- Karbindo Abesyapradhi - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SMC Global Power, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Billiton Holdings Pty Ltd - Australia
- Lanco Infratech Ltd - India
- India Bulls Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- San Jose City I Power Corp, Philippines
- Latin American Coal - Colombia
- Salva Resources Pvt Ltd - India
- Uttam Galva Steels Limited - India
- South Luzon Thermal Energy Corporation
- Minerals Council of Australia
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- OPG Power Generation Pvt Ltd - India
- Coal and Oil Company - UAE
- Global Business Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Price Waterhouse Coopers - Russia
- Miang Besar Coal Terminal - Indonesia
- Medco Energi Mining Internasional
- Australian Coal Association
- The University of Queensland
- PNOC Exploration Corporation - Philippines
- Carbofer General Trading SA - India
- Krishnapatnam Port Company Ltd. - India
- Semirara Mining and Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- PowerSource Philippines DevCo
- Globalindo Alam Lestari - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sinarmas Energy and Mining - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indika Energy - Indonesia
- Romanian Commodities Exchange
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GMR Energy Limited - India
- Marubeni Corporation - India
- GN Power Mariveles Coal Plant, Philippines
- Coalindo Energy - Indonesia
- Petron Corporation, Philippines
- Electricity Authority, New Zealand
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- Merrill Lynch Commodities Europe
- Makarim & Taira - Indonesia
- Videocon Industries ltd - India
- Sree Jayajothi Cements Limited - India
- Wood Mackenzie - Singapore
- Indogreen Group - Indonesia
- Essar Steel Hazira Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Sojitz Corporation - Japan
- Timah Investasi Mineral - Indoneisa
- Directorate Of Revenue Intelligence - India
- Deloitte Consulting - India
- Kartika Selabumi Mining - Indonesia
- White Energy Company Limited
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- CIMB Investment Bank - Malaysia
- Parry Sugars Refinery, India
- Kideco Jaya Agung - Indonesia
- Africa Commodities Group - South Africa
- Grasim Industreis Ltd - India
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- Bharathi Cement Corporation - India
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Ministry of Finance - Indonesia
- Riau Bara Harum - Indonesia
- Mercuria Energy - Indonesia
- London Commodity Brokers - England
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- Samtan Co., Ltd - South Korea
- Bangladesh Power Developement Board
- Siam City Cement - Thailand
- Gujarat Electricity Regulatory Commission - India
- Bhushan Steel Limited - India
- Bulk Trading Sa - Switzerland
- Eastern Energy - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Eastern Coal Council - USA
- IHS Mccloskey Coal Group - USA
- Ind-Barath Power Infra Limited - India
- Formosa Plastics Group - Taiwan
- Neyveli Lignite Corporation Ltd, - India
- Vedanta Resources Plc - India
- Renaissance Capital - South Africa
- Therma Luzon, Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- TeaM Sual Corporation - Philippines
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- Meenaskhi Energy Private Limited - India
- MS Steel International - UAE
- Electricity Generating Authority of Thailand
- Star Paper Mills Limited - India
- Banpu Public Company Limited - Thailand
- Simpson Spence & Young - Indonesia
- Gujarat Sidhee Cement - India
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Kumho Petrochemical, South Korea
- Tamil Nadu electricity Board
- Global Coal Blending Company Limited - Australia
- Chettinad Cement Corporation Ltd - India
- Indian Oil Corporation Limited
- Semirara Mining Corp, Philippines
- Agrawal Coal Company - India
- Thai Mozambique Logistica
- Energy Development Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Ministry of Transport, Egypt
- Central Java Power - Indonesia
- Kobexindo Tractors - Indoneisa
- Ministry of Mines - Canada
- Orica Mining Services - Indonesia
- Rio Tinto Coal - Australia
- IEA Clean Coal Centre - UK
- Goldman Sachs - Singapore
- Australian Commodity Traders Exchange
- Antam Resourcindo - Indonesia
- Standard Chartered Bank - UAE
- PetroVietnam Power Coal Import and Supply Company
- Mintek Dendrill Indonesia
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- The Treasury - Australian Government
- Oldendorff Carriers - Singapore
- Metalloyd Limited - United Kingdom
- Orica Australia Pty. Ltd.
- Bhoruka Overseas - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sindya Power Generating Company Private Ltd
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- Jindal Steel & Power Ltd - India
- Bhatia International Limited - India
- McConnell Dowell - Australia
- Thiess Contractors Indonesia
- Bukit Makmur.PT - Indonesia
- Economic Council, Georgia
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Straits Asia Resources Limited - Singapore
- Pendopo Energi Batubara - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Central Electricity Authority - India
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate General of MIneral and Coal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Alfred C Toepfer International GmbH - Germany
- ICICI Bank Limited - India
- Energy Link Ltd, New Zealand
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