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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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Tuesday, 08 May 12
DRY BULK MARKET LOOKING FOR NEW DIRECTION THIS WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the BDI (Baltic Dry Index) the main benchmark of the dry bulk shipping industry not traded at the start of this week, traders, charterers and s ...
Monday, 07 May 12
INDONESIAN HBA FALL AGAIN IN MAY 2012
COALspot.com - Indonesian HBA fall again to lowest level since January 2011 in May 2012. The monthly coal reference price for coal sales in Ma ...
Sunday, 06 May 12
INDONESIAN SUB-BITUMINOUS COAL & CFR SOUTH CHINA SWAPS SLIGHTLY DROP THIS WEEK
COALspot.com - Indonesian sub-bituminous coal swaps and CFR South China coal contracts for June deliveries slightly dropped this week.
According ...
Sunday, 06 May 12
S7 & S8 ROUTES LIKELY TO BE FIRM NEXT WEEK VISTAAR SINGAPORE
COALspot.com - The BDI remained flat this week and was up just by 1 point closing at 1,157 points.
The cape size index was up by 5.14 pct closing ...
Sunday, 06 May 12
EXPORT DUTY ON MINERAL FINALLY TO BECOME EFFECTIVE NEXT WEEK
COALspot.com - Mineral ore exporters of Indonesia ( only IUP holders) are required to obtain recommendation letter from the energy and mineral ...
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- Binh Thuan Hamico - Vietnam
- Globalindo Alam Lestari - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Coalindo Energy - Indonesia
- Star Paper Mills Limited - India
- Sical Logistics Limited - India
- Goldman Sachs - Singapore
- Jaiprakash Power Ventures ltd
- Mercuria Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Parliament of New Zealand
- Price Waterhouse Coopers - Russia
- Billiton Holdings Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- Sree Jayajothi Cements Limited - India
- Kumho Petrochemical, South Korea
- Sinarmas Energy and Mining - Indonesia
- Bukit Baiduri Energy - Indonesia
- New Zealand Coal & Carbon
- Meralco Power Generation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Posco Energy - South Korea
- Karaikal Port Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Banpu Public Company Limited - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- London Commodity Brokers - England
- Mintek Dendrill Indonesia
- Mercator Lines Limited - India
- Energy Development Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- PTC India Limited - India
- Maheswari Brothers Coal Limited - India
- Kobexindo Tractors - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Indogreen Group - Indonesia
- Savvy Resources Ltd - HongKong
- Intertek Mineral Services - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Edison Trading Spa - Italy
- Power Finance Corporation Ltd., India
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- IEA Clean Coal Centre - UK
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Standard Chartered Bank - UAE
- GMR Energy Limited - India
- Kapuas Tunggal Persada - Indonesia
- ASAPP Information Group - India
- Sarangani Energy Corporation, Philippines
- Global Business Power Corporation, Philippines
- Xindia Steels Limited - India
- Sakthi Sugars Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Metalloyd Limited - United Kingdom
- Bhoruka Overseas - Indonesia
- Chettinad Cement Corporation Ltd - India
- Anglo American - United Kingdom
- Manunggal Multi Energi - Indonesia
- Riau Bara Harum - Indonesia
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- Latin American Coal - Colombia
- Tata Chemicals Ltd - India
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- Cement Manufacturers Association - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Trasteel International SA, Italy
- Kohat Cement Company Ltd. - Pakistan
- Coastal Gujarat Power Limited - India
- Bhatia International Limited - India
- Ind-Barath Power Infra Limited - India
- Port Waratah Coal Services - Australia
- Asmin Koalindo Tuhup - Indonesia
- Kaltim Prima Coal - Indonesia
- Central Electricity Authority - India
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Eastern Coal Council - USA
- Carbofer General Trading SA - India
- Barasentosa Lestari - Indonesia
- Australian Coal Association
- Romanian Commodities Exchange
- AsiaOL BioFuels Corp., Philippines
- Electricity Generating Authority of Thailand
- Wilmar Investment Holdings
- Jindal Steel & Power Ltd - India
- Straits Asia Resources Limited - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SMG Consultants - Indonesia
- Minerals Council of Australia
- Global Coal Blending Company Limited - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Planning Commission, India
- Orica Australia Pty. Ltd.
- Commonwealth Bank - Australia
- Aboitiz Power Corporation - Philippines
- Rashtriya Ispat Nigam Limited - India
- Georgia Ports Authority, United States
- Videocon Industries ltd - India
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- Ministry of Finance - Indonesia
- SN Aboitiz Power Inc, Philippines
- ICICI Bank Limited - India
- Africa Commodities Group - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- Essar Steel Hazira Ltd - India
- Iligan Light & Power Inc, Philippines
- Indonesian Coal Mining Association
- Bukit Makmur.PT - Indonesia
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Salva Resources Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Rio Tinto Coal - Australia
- Gujarat Mineral Development Corp Ltd - India
- Ambuja Cements Ltd - India
- Energy Link Ltd, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Mjunction Services Limited - India
- European Bulk Services B.V. - Netherlands
- The University of Queensland
- Marubeni Corporation - India
- IHS Mccloskey Coal Group - USA
- Bayan Resources Tbk. - Indonesia
- The Treasury - Australian Government
- Directorate General of MIneral and Coal - Indonesia
- Renaissance Capital - South Africa
- Timah Investasi Mineral - Indoneisa
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- PetroVietnam Power Coal Import and Supply Company
- Eastern Energy - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Wood Mackenzie - Singapore
- Singapore Mercantile Exchange
- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Baramulti Group, Indonesia
- Sojitz Corporation - Japan
- VISA Power Limited - India
- Chamber of Mines of South Africa
- Grasim Industreis Ltd - India
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Karbindo Abesyapradhi - Indoneisa
- Dalmia Cement Bharat India
- Electricity Authority, New Zealand
- Leighton Contractors Pty Ltd - Australia
- MS Steel International - UAE
- International Coal Ventures Pvt Ltd - India
- Attock Cement Pakistan Limited
- GAC Shipping (India) Pvt Ltd
- Australian Commodity Traders Exchange
- Merrill Lynch Commodities Europe
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- Bharathi Cement Corporation - India
- Thai Mozambique Logistica
- SMC Global Power, Philippines
- Kideco Jaya Agung - Indonesia
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- Makarim & Taira - Indonesia
- San Jose City I Power Corp, Philippines
- GVK Power & Infra Limited - India
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- Coal and Oil Company - UAE
- Altura Mining Limited, Indonesia
- Lanco Infratech Ltd - India
- Ministry of Mines - Canada
- LBH Netherlands Bv - Netherlands
- Cigading International Bulk Terminal - Indonesia
- Thiess Contractors Indonesia
- Antam Resourcindo - Indonesia
- Larsen & Toubro Limited - India
- Bulk Trading Sa - Switzerland
- PNOC Exploration Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Aditya Birla Group - India
- Malabar Cements Ltd - India
- Economic Council, Georgia
- Petron Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Pendopo Energi Batubara - Indonesia
- Miang Besar Coal Terminal - Indonesia
- The State Trading Corporation of India Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- India Bulls Power Limited - India
- Oldendorff Carriers - Singapore
- Meenaskhi Energy Private Limited - India
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