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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, 01 March 12
INDO-INDIA, LARGE ECO SUPRA CAN FETCH CLOSE TO USD 9K DOP N.CHINA - FEARNLEYS AS
Handy
The Atlantic Handysize market did not see any signs for recovery this week. It is still a major lack of spot cargoes and an oversupply of pro ...
Wednesday, 29 February 12
69 MINERS AGREE TO RENEGOTIATE CONTRACTS - THE JAKARTA POST
The Jakarta Post, one of the leading English news papaer in Indonesia reported that, as many as 60 coal contracts-of-work (PKP2B) and nine non-coal ...
Wednesday, 29 February 12
PUTTING COAL GASIFICATION TO WORK
Clifford Reese of the SSOE Group looks at practical solutions for district energy leaders who wish to implement clean coal technology.
Coal fuels ...
Monday, 27 February 12
COAL MINING PROFITS TOO HIGH, SAYS GOVT - TEMPO INTERACTIVE
Tempo Interactive reported that, Energy and Mineral Resources Deputy Minister of Indonesia Widjajono Partowidagdo has criticized coal-mining compani ...
Monday, 27 February 12
INDONESIAN COAL EXPORTS TO CHINA DROPS 39.76 PERCENT IN JANUARY 2012
COALspot.com: Indonesia, the world largest coal exporter, shipped 28.21* mln mt of coal in January 2012, slightly lower than its December 2011 ...
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- Electricity Authority, New Zealand
- Borneo Indobara - Indonesia
- Grasim Industreis Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Therma Luzon, Inc, Philippines
- Wilmar Investment Holdings
- Kobexindo Tractors - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Marubeni Corporation - India
- McConnell Dowell - Australia
- Xindia Steels Limited - India
- Thai Mozambique Logistica
- Thiess Contractors Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vizag Seaport Private Limited - India
- Sarangani Energy Corporation, Philippines
- Sojitz Corporation - Japan
- Parliament of New Zealand
- Siam City Cement PLC, Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Aditya Birla Group - India
- Rio Tinto Coal - Australia
- Latin American Coal - Colombia
- TeaM Sual Corporation - Philippines
- Posco Energy - South Korea
- PowerSource Philippines DevCo
- Barasentosa Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Formosa Plastics Group - Taiwan
- Indo Tambangraya Megah - Indonesia
- India Bulls Power Limited - India
- Antam Resourcindo - Indonesia
- Ind-Barath Power Infra Limited - India
- Malabar Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Bulk Trading Sa - Switzerland
- The University of Queensland
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Global Coal Blending Company Limited - Australia
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- Minerals Council of Australia
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Sidhee Cement - India
- Jaiprakash Power Ventures ltd
- Maharashtra Electricity Regulatory Commission - India
- GN Power Mariveles Coal Plant, Philippines
- New Zealand Coal & Carbon
- Bayan Resources Tbk. - Indonesia
- Meralco Power Generation, Philippines
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Africa Commodities Group - South Africa
- Globalindo Alam Lestari - Indonesia
- Metalloyd Limited - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Interocean Group of Companies - India
- Tamil Nadu electricity Board
- PetroVietnam Power Coal Import and Supply Company
- Makarim & Taira - Indonesia
- Port Waratah Coal Services - Australia
- Energy Development Corp, Philippines
- GMR Energy Limited - India
- Krishnapatnam Port Company Ltd. - India
- Simpson Spence & Young - Indonesia
- Central Electricity Authority - India
- Jindal Steel & Power Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Australian Commodity Traders Exchange
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- Indika Energy - Indonesia
- Medco Energi Mining Internasional
- South Luzon Thermal Energy Corporation
- Siam City Cement - Thailand
- CIMB Investment Bank - Malaysia
- Sakthi Sugars Limited - India
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Ministry of Mines - Canada
- Manunggal Multi Energi - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Semirara Mining Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- IEA Clean Coal Centre - UK
- Australian Coal Association
- London Commodity Brokers - England
- Oldendorff Carriers - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Intertek Mineral Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Bangladesh Power Developement Board
- Altura Mining Limited, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- Miang Besar Coal Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Deloitte Consulting - India
- Karbindo Abesyapradhi - Indoneisa
- VISA Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Wood Mackenzie - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Finance - Indonesia
- SN Aboitiz Power Inc, Philippines
- Trasteel International SA, Italy
- ASAPP Information Group - India
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- Vedanta Resources Plc - India
- Attock Cement Pakistan Limited
- Mercator Lines Limited - India
- IHS Mccloskey Coal Group - USA
- MS Steel International - UAE
- OPG Power Generation Pvt Ltd - India
- Orica Mining Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coastal Gujarat Power Limited - India
- Orica Australia Pty. Ltd.
- GAC Shipping (India) Pvt Ltd
- SMG Consultants - Indonesia
- European Bulk Services B.V. - Netherlands
- Standard Chartered Bank - UAE
- Indonesian Coal Mining Association
- Tata Chemicals Ltd - India
- Global Business Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Romanian Commodities Exchange
- Global Green Power PLC Corporation, Philippines
- ICICI Bank Limited - India
- Power Finance Corporation Ltd., India
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- LBH Netherlands Bv - Netherlands
- Singapore Mercantile Exchange
- Edison Trading Spa - Italy
- Bukit Baiduri Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- White Energy Company Limited
- Indogreen Group - Indonesia
- Mercuria Energy - Indonesia
- Indian Energy Exchange, India
- Eastern Coal Council - USA
- The Treasury - Australian Government
- Holcim Trading Pte Ltd - Singapore
- Central Java Power - Indonesia
- Price Waterhouse Coopers - Russia
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- Bukit Asam (Persero) Tbk - Indonesia
- Kumho Petrochemical, South Korea
- Commonwealth Bank - Australia
- Riau Bara Harum - Indonesia
- International Coal Ventures Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Sindya Power Generating Company Private Ltd
- Videocon Industries ltd - India
- Independent Power Producers Association of India
- Mintek Dendrill Indonesia
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- Goldman Sachs - Singapore
- Star Paper Mills Limited - India
- San Jose City I Power Corp, Philippines
- Dalmia Cement Bharat India
- Baramulti Group, Indonesia
- Coal and Oil Company - UAE
- The State Trading Corporation of India Ltd
- Meenaskhi Energy Private Limited - India
- Mjunction Services Limited - India
- SMC Global Power, Philippines
- Toyota Tsusho Corporation, Japan
- CNBM International Corporation - China
- Ambuja Cements Ltd - India
- GVK Power & Infra Limited - India
- Madhucon Powers Ltd - India
- Heidelberg Cement - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Oil Corporation Limited
- Merrill Lynch Commodities Europe
- Vijayanagar Sugar Pvt Ltd - India
- Bhushan Steel Limited - India
- Planning Commission, India
- PTC India Limited - India
- Rashtriya Ispat Nigam Limited - India
- Chettinad Cement Corporation Ltd - India
- Cement Manufacturers Association - India
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Energy Link Ltd, New Zealand
- Bharathi Cement Corporation - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Electricity Regulatory Commission - India
- Coalindo Energy - Indonesia
- Bhatia International Limited - India
- Renaissance Capital - South Africa
- Electricity Generating Authority of Thailand
- Kideco Jaya Agung - Indonesia
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