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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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Thursday, 22 March 12
DRY BULK MARKET KEEPS SURGING, CAPESIZES FALLING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what seems to be an establishing pattern, the dry bulk market has kept its upward momentum, edging closer to the 900 point-mark, but the larger s ...
Wednesday, 21 March 12
BUMA HAS PRODUCED 2.3 MILLION TONS OF COAL IN FEBRUARY 2012
COALspot.com - PT. Delta Dunia Makmur's overburden removal in February 2012 has reached totaled 23.8 million bcm (+2.4% YoY) while coal production ...
Tuesday, 20 March 12
SMALLER DRY BULK VESSELS STILL LEADING DRY BULK MARKET TO HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been growing during the past couple of weeks, but contrary to the usual practice, it’s not the larger Capesizes which ...
Monday, 19 March 12
WEEKLY DRY MARKET OVERVIEW: SMALLER VESSELS LEAD RATES HIGHER - MARIA BERTZELETOU, HELLENIC SHIPPING
The upward trend of the Baltic Dry Index persists strong from the end of February, spurred from the supramax market that offsets the weakness in the ...
Sunday, 18 March 12
BUKIT ASAM'S NET PROFIT IN 2011 ROSE 54% TO US$ 339.56 MILLION
COALspot.com - Company revenue for the period January - December 2011 amounting to Rp 10.6 trillion (approximately US$ 1,164,835,164.84) recorded an ...
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- SMC Global Power, Philippines
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Jindal Steel & Power Ltd - India
- Eastern Coal Council - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Economic Council, Georgia
- Bukit Makmur.PT - Indonesia
- Samtan Co., Ltd - South Korea
- Sinarmas Energy and Mining - Indonesia
- Energy Development Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Coastal Gujarat Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Sical Logistics Limited - India
- CIMB Investment Bank - Malaysia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Bhushan Steel Limited - India
- PetroVietnam Power Coal Import and Supply Company
- IEA Clean Coal Centre - UK
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- Essar Steel Hazira Ltd - India
- Antam Resourcindo - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Transport, Egypt
- Jaiprakash Power Ventures ltd
- Bharathi Cement Corporation - India
- Parry Sugars Refinery, India
- Ministry of Mines - Canada
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Parliament of New Zealand
- Makarim & Taira - Indonesia
- Maheswari Brothers Coal Limited - India
- PTC India Limited - India
- Riau Bara Harum - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Merrill Lynch Commodities Europe
- Manunggal Multi Energi - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Altura Mining Limited, Indonesia
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- Indian Oil Corporation Limited
- Sree Jayajothi Cements Limited - India
- Salva Resources Pvt Ltd - India
- Thai Mozambique Logistica
- Kartika Selabumi Mining - Indonesia
- Siam City Cement - Thailand
- White Energy Company Limited
- Tamil Nadu electricity Board
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- Alfred C Toepfer International GmbH - Germany
- Deloitte Consulting - India
- Trasteel International SA, Italy
- Sakthi Sugars Limited - India
- The Treasury - Australian Government
- Mercator Lines Limited - India
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- Coalindo Energy - Indonesia
- Attock Cement Pakistan Limited
- Standard Chartered Bank - UAE
- Port Waratah Coal Services - Australia
- Ceylon Electricity Board - Sri Lanka
- Romanian Commodities Exchange
- San Jose City I Power Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- Indika Energy - Indonesia
- The University of Queensland
- Larsen & Toubro Limited - India
- Iligan Light & Power Inc, Philippines
- London Commodity Brokers - England
- Malabar Cements Ltd - India
- Uttam Galva Steels Limited - India
- Interocean Group of Companies - India
- South Luzon Thermal Energy Corporation
- Bayan Resources Tbk. - Indonesia
- Bhatia International Limited - India
- European Bulk Services B.V. - Netherlands
- Orica Australia Pty. Ltd.
- Bank of Tokyo Mitsubishi UFJ Ltd
- Borneo Indobara - Indonesia
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- Electricity Authority, New Zealand
- OPG Power Generation Pvt Ltd - India
- Cement Manufacturers Association - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Java Power - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Marubeni Corporation - India
- Maharashtra Electricity Regulatory Commission - India
- ICICI Bank Limited - India
- Grasim Industreis Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Kumho Petrochemical, South Korea
- Binh Thuan Hamico - Vietnam
- Global Green Power PLC Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- PowerSource Philippines DevCo
- Independent Power Producers Association of India
- Posco Energy - South Korea
- Indian Energy Exchange, India
- Latin American Coal - Colombia
- Planning Commission, India
- GAC Shipping (India) Pvt Ltd
- Cigading International Bulk Terminal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Madhucon Powers Ltd - India
- Meenaskhi Energy Private Limited - India
- Power Finance Corporation Ltd., India
- Banpu Public Company Limited - Thailand
- Vedanta Resources Plc - India
- Oldendorff Carriers - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Rio Tinto Coal - Australia
- GN Power Mariveles Coal Plant, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Simpson Spence & Young - Indonesia
- Central Electricity Authority - India
- Miang Besar Coal Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- TeaM Sual Corporation - Philippines
- Orica Mining Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Bulk Trading Sa - Switzerland
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Metalloyd Limited - United Kingdom
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Kepco SPC Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Videocon Industries ltd - India
- Krishnapatnam Port Company Ltd. - India
- Indonesian Coal Mining Association
- India Bulls Power Limited - India
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- IHS Mccloskey Coal Group - USA
- SMG Consultants - Indonesia
- Formosa Plastics Group - Taiwan
- AsiaOL BioFuels Corp., Philippines
- Karaikal Port Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Billiton Holdings Pty Ltd - Australia
- McConnell Dowell - Australia
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Anglo American - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Africa Commodities Group - South Africa
- Eastern Energy - Thailand
- Petron Corporation, Philippines
- Renaissance Capital - South Africa
- VISA Power Limited - India
- Global Coal Blending Company Limited - Australia
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Meralco Power Generation, Philippines
- Wood Mackenzie - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Electricity Generating Authority of Thailand
- Chettinad Cement Corporation Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- LBH Netherlands Bv - Netherlands
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Bukit Asam (Persero) Tbk - Indonesia
- Star Paper Mills Limited - India
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Medco Energi Mining Internasional
- Gujarat Sidhee Cement - India
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Mjunction Services Limited - India
- Tata Chemicals Ltd - India
- GMR Energy Limited - India
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- Australian Coal Association
- Aboitiz Power Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Heidelberg Cement - Germany
- Edison Trading Spa - Italy
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- Xindia Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Dalmia Cement Bharat India
- Singapore Mercantile Exchange
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