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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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Friday, 22 June 12
GLOBAL ACTION NEEDED ON ENERGY POVERTY - WORLD COAL
Eradicating energy poverty is possibly the biggest challenge facing the world today. Like climate change it can only be addressed with a concerted g ...
Friday, 22 June 12
COAL: THE BACKBONE OF MODERN ELECTRICITY - ECOAL
Coal has been described as the "forgotten fuel," perhaps because many aren't aware of the huge role it plays in powering the global econo ...
Thursday, 21 June 12
DRY BULK MARKET ON THE RISE AGAIN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was on the rise once again yesterday, with the Baltic Dry Index (BDI), the industry’s benchmark, rising by 18 points, or 1 ...
Wednesday, 20 June 12
BDI MOVING HIGHER, PANAMAX AND SUPRAMAX VESSELS STRONGER, CAPESIZE RATES NEAR TO HISTORICAL LOWS OF DECEMBER 2008 - MARIA BERTZELETOU, HELLENIC SHIPPING
The dry market seems to follow the dynamic of the previous week with the Baltic Dry Index showing daily increases since June 8th, but is still stand ...
Tuesday, 19 June 12
SMALLER DRY BULK CARRIERS LIFT UP MARKET, PANAMAXES SET TO FALL SAYS ANALYST - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Another rise for the dry bulk market was evident yesterday, as the industry’s benchmark, the BDI (Baltic Dry Index) was up for a ninth straigh ...
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- Directorate Of Revenue Intelligence - India
- Baramulti Group, Indonesia
- Xindia Steels Limited - India
- Kartika Selabumi Mining - Indonesia
- Australian Coal Association
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- The Treasury - Australian Government
- ICICI Bank Limited - India
- Ministry of Finance - Indonesia
- Australian Commodity Traders Exchange
- Georgia Ports Authority, United States
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Agrawal Coal Company - India
- Planning Commission, India
- Meenaskhi Energy Private Limited - India
- Sakthi Sugars Limited - India
- Petron Corporation, Philippines
- Makarim & Taira - Indonesia
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- Bhoruka Overseas - Indonesia
- Electricity Generating Authority of Thailand
- Bukit Baiduri Energy - Indonesia
- Global Business Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- IEA Clean Coal Centre - UK
- GMR Energy Limited - India
- Mercator Lines Limited - India
- Videocon Industries ltd - India
- Singapore Mercantile Exchange
- Bukit Makmur.PT - Indonesia
- The University of Queensland
- Standard Chartered Bank - UAE
- Edison Trading Spa - Italy
- Simpson Spence & Young - Indonesia
- Coalindo Energy - Indonesia
- Salva Resources Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Borneo Indobara - Indonesia
- Rio Tinto Coal - Australia
- Mjunction Services Limited - India
- Alfred C Toepfer International GmbH - Germany
- Indonesian Coal Mining Association
- Savvy Resources Ltd - HongKong
- Parliament of New Zealand
- Kideco Jaya Agung - Indonesia
- Formosa Plastics Group - Taiwan
- Dalmia Cement Bharat India
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Latin American Coal - Colombia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Chamber of Mines of South Africa
- Wood Mackenzie - Singapore
- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Sojitz Corporation - Japan
- Parry Sugars Refinery, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- Essar Steel Hazira Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Thai Mozambique Logistica
- Malabar Cements Ltd - India
- Electricity Authority, New Zealand
- SN Aboitiz Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Interocean Group of Companies - India
- Grasim Industreis Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Aboitiz Power Corporation - Philippines
- Eastern Coal Council - USA
- Timah Investasi Mineral - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- Chettinad Cement Corporation Ltd - India
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- Orica Australia Pty. Ltd.
- Semirara Mining and Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Minerals Council of Australia
- AsiaOL BioFuels Corp., Philippines
- Barasentosa Lestari - Indonesia
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- International Coal Ventures Pvt Ltd - India
- Renaissance Capital - South Africa
- Eastern Energy - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- SMC Global Power, Philippines
- Manunggal Multi Energi - Indonesia
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- VISA Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- PNOC Exploration Corporation - Philippines
- Kumho Petrochemical, South Korea
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- Merrill Lynch Commodities Europe
- Iligan Light & Power Inc, Philippines
- Medco Energi Mining Internasional
- Carbofer General Trading SA - India
- GN Power Mariveles Coal Plant, Philippines
- Bhatia International Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Sinarmas Energy and Mining - Indonesia
- Meralco Power Generation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- London Commodity Brokers - England
- Ceylon Electricity Board - Sri Lanka
- Economic Council, Georgia
- Wilmar Investment Holdings
- South Luzon Thermal Energy Corporation
- Posco Energy - South Korea
- Ambuja Cements Ltd - India
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- GAC Shipping (India) Pvt Ltd
- Altura Mining Limited, Indonesia
- Intertek Mineral Services - Indonesia
- Semirara Mining Corp, Philippines
- Tata Chemicals Ltd - India
- Riau Bara Harum - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Kobexindo Tractors - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Sical Logistics Limited - India
- Indian Oil Corporation Limited
- IHS Mccloskey Coal Group - USA
- Marubeni Corporation - India
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- Maheswari Brothers Coal Limited - India
- Indian Energy Exchange, India
- Lanco Infratech Ltd - India
- Independent Power Producers Association of India
- Antam Resourcindo - Indonesia
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- SMG Consultants - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Goldman Sachs - Singapore
- Trasteel International SA, Italy
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- Bulk Trading Sa - Switzerland
- Siam City Cement - Thailand
- Oldendorff Carriers - Singapore
- Bhushan Steel Limited - India
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- Samtan Co., Ltd - South Korea
- Siam City Cement PLC, Thailand
- Therma Luzon, Inc, Philippines
- Heidelberg Cement - Germany
- TeaM Sual Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- San Jose City I Power Corp, Philippines
- Cement Manufacturers Association - India
- Ministry of Transport, Egypt
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indo Tambangraya Megah - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Power Finance Corporation Ltd., India
- Holcim Trading Pte Ltd - Singapore
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- Vizag Seaport Private Limited - India
- Sindya Power Generating Company Private Ltd
- Global Green Power PLC Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Romanian Commodities Exchange
- Jaiprakash Power Ventures ltd
- Miang Besar Coal Terminal - Indonesia
- Sarangani Energy Corporation, Philippines
- Aditya Birla Group - India
- Maharashtra Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Central Electricity Authority - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- New Zealand Coal & Carbon
- Bharathi Cement Corporation - India
- Indika Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Attock Cement Pakistan Limited
- Star Paper Mills Limited - India
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