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Friday, 06 April 12
DRY BULK MARKET SWIFT TO HALT FALL ON RENEWED DEMAND FOR CAPESIZES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The dry bulk managed to put a stop to the recent falls, which came as a result of a lacklustre demand for smaller vessel sizes. Although this trend has remained the same, the return of Chinese charterers from their three-day holidays marked a stronger demand for Capesizes yesterday, which in turn was enough to offset the lack of interest for smaller vessels and lead the market to higher ground. The Baltic Dry Index (BDI) was up by 0..22% to 928 points yesterday, with Capesizes gaining 2.17% on the day and reaching 1,507 points. By contrast, the demise of the Supramax market was again evident, with the relative index losing 1.66%, while Panamaxes were also down by 0.67%.
Detailing the oversupply issues which have caused the dry bulk market to retreat to such low levels since the start of the year, Intermodal’s Theodore Ntalakos said that “the freight market and other circumstances were quite convenient for many shipowners who while acting independently and rationally consulting their own self-interest, ordered new buildings even when it was clear that in the long-term the excessive tonnage would eventually suffocate the freight market. It is a real-life example of game theory that shows why two or more individuals might not cooperate, even if it is in their best interest to do so” said Mr. Ntalakos.
He went on to give an example to make his case. “Say we have one shipowner ( Shipowner A) and all the rest shipowners (Shipowner B). Each of their strategy is either to expand by ordering the new fuel efficient vessels or not to order and buy a vessel from the second hand market. We have four possible scenarios:
I. If Shipowner A orders and no one else does then he will get the benefit of new designs, and earn say $10, B stays behind and earns $1
II. If both A and B order then they lose the advantage and they earn very little - $2,
III. If no one orders then they earn moderately from their existing fleet - $5 each, and
IV. If shipowner A does not order but 'B' orders then 'A' will earn very little because the charterers will prefer B's ECO ships – A earns $1, B earns $10.
Here, regardless of what the other decides, each shipowner gets a higher pay-off by ordering new vessels:
I. If B does not order, the payoffs for A are $5 or $10 so he will always chose $10 i.e to order.
II. If B orders, the payoffs for A are $1 or $2 so he will always chose $2 i.e to order
The game is symmetric so Shipower B would always act the same way which means that both shipowers would order new vessels. Since both rational owners decide to order new vessels each receives a lower reward than if both were not to order!! So, rational decision-making results being worse off than if each chose not to order and accept to earn less. As the two shipowners can’t see what the others are doing and cannot play a cooperative game, they will decide to maximize their pay-off and always proceed with orders” said Mr. Ntalakos in a rather interesting undertaking.
He concluded his analysis by stating “we need however to point out that the new ECO ships especially with the current restrain on finance, will only be a small part of the total fleet and orderbook and it will take years to play a substantial part and drive the older vessels out of the market, so we expect owners who order such vessels with today's new builiding and bunker prices to have the competitive advantage for the years to come.
So, there you have it, Shipping is a non-cooperative game. Then why do pools exist? Even in pools if each member's interest to put the next (and succeeding) vessel he acquires into the pool and the demand is limited then the quality of the common is damaged for everybody. So like everything else in life one needs to find the proper equilibrium between cooperating and looking after one's self-interest” he said.
Source: Nikos Roussanoglou, Hellenic Shipping
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Saturday, 07 July 12
EXCESS SUPPLY & WEAK DEMAND KEEP COAL PRICES LOW
COALspot.com - SGX AsiaClear OTC Coal Swaps for August and Q4 deliveries slipped slightly this week. SGX’s Indonesian sub-bituminous coal swap ...
Saturday, 07 July 12
BALTIC INDEX UP ON STRONG CAPE, PANAMAX RATES - VISTAAR
COALspot.com - This week all the segments were firmed up with BDI up by 15.23 pct (up by 153 points) closing at 1,157 points.
The cape index also ...
Saturday, 07 July 12
DRY BULK MARKET NOT ABLE TO FIND SOLID GROUND SAY EXPERTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the second half of each, traditionally looking the most active one, especially in terms of newbuildings being delivered, it's highly unlikely ...
Thursday, 05 July 12
GOVT GETS READY FOR $1.8B SUIT - THE JAKARTA POST
The Jakarta Post, one of the leading Indonesian English new papers reported that, several ministries and the Attorney General’s Office held a ...
Thursday, 05 July 12
DRY BULK MARKET MOVES FURTHER UP THE HILL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its growth momentum by the middle of the week, as the BDI (Baltic Dry Index) rose by an additional 40 points to 1,103 p ...
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- Bahari Cakrawala Sebuku - Indonesia
- The University of Queensland
- Edison Trading Spa - Italy
- Semirara Mining and Power Corporation, Philippines
- Marubeni Corporation - India
- Globalindo Alam Lestari - Indonesia
- White Energy Company Limited
- ICICI Bank Limited - India
- Global Green Power PLC Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Interocean Group of Companies - India
- Economic Council, Georgia
- Global Business Power Corporation, Philippines
- Trasteel International SA, Italy
- GAC Shipping (India) Pvt Ltd
- Medco Energi Mining Internasional
- Ministry of Finance - Indonesia
- Singapore Mercantile Exchange
- Mercator Lines Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Sidhee Cement - India
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- GVK Power & Infra Limited - India
- Makarim & Taira - Indonesia
- Timah Investasi Mineral - Indoneisa
- Dalmia Cement Bharat India
- Miang Besar Coal Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Thai Mozambique Logistica
- CIMB Investment Bank - Malaysia
- London Commodity Brokers - England
- Meenaskhi Energy Private Limited - India
- Central Java Power - Indonesia
- Mercuria Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- Wood Mackenzie - Singapore
- Maheswari Brothers Coal Limited - India
- Kobexindo Tractors - Indoneisa
- Altura Mining Limited, Indonesia
- The Treasury - Australian Government
- OPG Power Generation Pvt Ltd - India
- Latin American Coal - Colombia
- Sojitz Corporation - Japan
- Formosa Plastics Group - Taiwan
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Cement Manufacturers Association - India
- McConnell Dowell - Australia
- Maharashtra Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Chamber of Mines of South Africa
- Renaissance Capital - South Africa
- Indogreen Group - Indonesia
- Australian Coal Association
- Uttam Galva Steels Limited - India
- Parliament of New Zealand
- Indonesian Coal Mining Association
- Simpson Spence & Young - Indonesia
- Aditya Birla Group - India
- IHS Mccloskey Coal Group - USA
- Ambuja Cements Ltd - India
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Indian Energy Exchange, India
- Sinarmas Energy and Mining - Indonesia
- Essar Steel Hazira Ltd - India
- Siam City Cement - Thailand
- TeaM Sual Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- LBH Netherlands Bv - Netherlands
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- Coalindo Energy - Indonesia
- Star Paper Mills Limited - India
- Manunggal Multi Energi - Indonesia
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Heidelberg Cement - Germany
- Electricity Authority, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Minerals Council of Australia
- Barasentosa Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Electricity Generating Authority of Thailand
- Oldendorff Carriers - Singapore
- Power Finance Corporation Ltd., India
- Directorate General of MIneral and Coal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Transport, Egypt
- Sical Logistics Limited - India
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Vizag Seaport Private Limited - India
- Iligan Light & Power Inc, Philippines
- GMR Energy Limited - India
- Coal and Oil Company - UAE
- Aboitiz Power Corporation - Philippines
- Antam Resourcindo - Indonesia
- Binh Thuan Hamico - Vietnam
- Merrill Lynch Commodities Europe
- Vedanta Resources Plc - India
- Kideco Jaya Agung - Indonesia
- Deloitte Consulting - India
- Sindya Power Generating Company Private Ltd
- Madhucon Powers Ltd - India
- Bhatia International Limited - India
- Siam City Cement PLC, Thailand
- European Bulk Services B.V. - Netherlands
- Orica Mining Services - Indonesia
- PTC India Limited - India
- Borneo Indobara - Indonesia
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- Alfred C Toepfer International GmbH - Germany
- GN Power Mariveles Coal Plant, Philippines
- Sree Jayajothi Cements Limited - India
- Australian Commodity Traders Exchange
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Billiton Holdings Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Mines - Canada
- Meralco Power Generation, Philippines
- Energy Link Ltd, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Jindal Steel & Power Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Mjunction Services Limited - India
- Agrawal Coal Company - India
- Orica Australia Pty. Ltd.
- Sakthi Sugars Limited - India
- Africa Commodities Group - South Africa
- Grasim Industreis Ltd - India
- Kaltim Prima Coal - Indonesia
- Metalloyd Limited - United Kingdom
- Wilmar Investment Holdings
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- Therma Luzon, Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Baramulti Group, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Indian Oil Corporation Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Baiduri Energy - Indonesia
- MS Steel International - UAE
- Straits Asia Resources Limited - Singapore
- Indika Energy - Indonesia
- SMC Global Power, Philippines
- Videocon Industries ltd - India
- Commonwealth Bank - Australia
- Price Waterhouse Coopers - Russia
- Eastern Energy - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Xindia Steels Limited - India
- Independent Power Producers Association of India
- Larsen & Toubro Limited - India
- Cigading International Bulk Terminal - Indonesia
- Indo Tambangraya Megah - Indonesia
- International Coal Ventures Pvt Ltd - India
- New Zealand Coal & Carbon
- Samtan Co., Ltd - South Korea
- Vijayanagar Sugar Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Anglo American - United Kingdom
- Rashtriya Ispat Nigam Limited - India
- Toyota Tsusho Corporation, Japan
- The State Trading Corporation of India Ltd
- Tamil Nadu electricity Board
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate Of Revenue Intelligence - India
- IEA Clean Coal Centre - UK
- Semirara Mining Corp, Philippines
- San Jose City I Power Corp, Philippines
- Lanco Infratech Ltd - India
- Energy Development Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tata Chemicals Ltd - India
- Bangladesh Power Developement Board
- Malabar Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ind-Barath Power Infra Limited - India
- Attock Cement Pakistan Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- India Bulls Power Limited - India
- Romanian Commodities Exchange
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Kumho Petrochemical, South Korea
- Eastern Coal Council - USA
- Standard Chartered Bank - UAE
- Global Coal Blending Company Limited - Australia
- Bulk Trading Sa - Switzerland
- Posco Energy - South Korea
- SMG Consultants - Indonesia
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