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Saturday, 26 May 12
DRY BULK SHIP OWNERS LOOKING TO CUT BACK ON TONNAGE SUPPLY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The oversupply of dry bulk carriers has been the most prominent problem in the market today, pushing down rates and ‘strangling’ profitability. According to ICAP Shipping congestion of the dry bulk fleet at Australian, Brazilian, Indian and Chinese ports at the end of last week was just above the 60Mdwt mark. "This is the highest level we have seen for thirteen weeks (since the middle of February this year) and is equivalent to around 10% of the total fleet. Interestingly, congestion has risen across all of the sectors from Capesize to Handysize. Capes currently account for 37.7Mdwt of the total queuing at ports, growth of over 7% week-on-week, while Panamaxes account for around 11.8Mdwt, growth of just under 9% w-o-w. Interestingly the largest percentage increases in congestion were for Supramax and Handysize, where on a w-o-w basis it rose by 15% and 25% respectively.
Nevertheless, in terms of deadweight these two sectors combined still accounted for less than total Panamax congestion. Provided all other factors remain unchanged, increased congestion at ports should provide some support to freight rates based on simple supply/demand dynamics; specifically a tightening of tonnage supply" said ICAP Shipping.
In its latest weekly report, shipbroker Intermodal noted that 2011 was a fairly disappointing year for shipping, with a tremendously large mismatch between supply and demand for the dry bulk segment in particular. “This affected both market prices and freight rates which fell close to some of the lowest levels recorded. Prices for tonnage older than 15 years of age reached fairly close to the residual value of the vessel itself (its value in terms of steel). It has been widely regarded in the whole shipping community that the only solution would be to scrap all vessels built prior to the 90's. As a result there has been an immense surge of older tonnage heading towards scrapyards in Bangladesh, China, India, Pakistan and Turkey. During the same period last year 17.8m deadweight has left the world fleet providing the markets with 3.5m tonnes of steel. By the end of 2011 the total amount of carrying capacity sent for scrap had reached 44.2m dwt which is equivalent with 8,7m tonnes of steel. Unfortunately and despite the evident efforts to reduce the fleet size, the large order book kept the supply of vessels on the rise. Around 1,125 dry bulkers (above 20,000dwt) were delivered during 2011, while at the same time only 339 dry bulkers (above 20,000dwt) were sent for scrap” said Spyros Stavropoulos, Intermodal’s analyst.
He went on to mention that “the first five and a half months of 2012 have shown positive signs, as demolition volume has been higher than that seen during the same period last year. Up to now, 25.8m dwt of vintage tonnage has been subtracted from the world fleet, albeit the fall in demolition price levels noted during the past weeks. These encouraging numbers are showing that the shipping community is committed to reducing the world fleet. An example of this temperament are the Capesize bulkers being sent for demolition which are defying the slide in ship scrapping prices”.
Meanwhile, “South Asian yards are well stocked as the subcontinent’s monsoon season approaches, while weakening steel demand in China has made its yards cut back on purchases. Prices in South Asian yards have dropped to $440-445 per ldt for bulkers and $465/ldt for tankers, from $450/ldt and $475-490/ldt the previous week. Chinese yards’ offers are unchanged at $390/ldt for bulkers and $415/ldt for tankers. But that did not stop owners from sending their ageing Capesizes for recycling, amid a still-depressed freight market. Big ships and vessels with rich stainless steel content continued to outperform the ship recycling market. With rates falling by the day, it is advisable for owners to decide the fate of their vessels quickly and take the best price/buyer available, as otherwise they may find themselves chasing down the market.
The drop in prices is explained by the oversupply of demo candidates which has led to an only natural drop in scrap steel prices. We can only hope that the levels of demolition seen so far this year for dry bulkers continue and that a significant amount of the large order book of 1,219 dry bulk vessels scheduled for delivery in the remaining period of 2012 is not fulfilled” Intermodal concluded.
Intermodal had noted that "Hellenic ship owners still occupy the top position amongst buyers in the secondhand S&P market. In its latest report, Intermodal mentioned that “since January they have managed to pick up at least 70 vessels spending over $ 1.2 billion to do so. This is a large difference when compared to the Chinese which hold second place amongst buyers’ nationality, with only 42 vessels reported purchased so far and having spent less than half the amount of that spent by the Greeks. This is even more remarkable when one considers the general lack of financing observed in shipping, let alone that available in the now illiquid Greek market”. In his note, Intermodal’s George Lazaridis stated that “all this points to the fact that Greeks continue to hold a firm belief in the shipping markets, as many of have an extensive experience of the market cycles and are used to navigating through such troubled market conditions. This does not mean that all is well and that there haven’t been or aren’t going to be casualties along the way. After all these cycles provide a cleansing opportunity, removing mismanaged companies and owners while at the same time pushing market players to remain competitive and efficient in the service they provide" he mentioned in a relative report.
Source: Nikos Roussanoglou, Hellenic Shipping
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Thursday, 03 May 12
DRY BULK MARKET REMAINS INACTIVE, POSTING MILD DECREASE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept retreating this week, although at a very low pace, on the back of a lull in demand. The industry's benchmark, th ...
Thursday, 03 May 12
MINERS DEMAND LEGAL CERTAINTY ON PRE-BAN INTERIM POLICY - THE JAKARTA POST
The Jakarta Post reported that, Mining companies represented by the Indonesian Mining Association (IMA) welcomed the government’s plan to impo ...
Thursday, 03 May 12
HANDY EAST COAST INDIA - CHINA AROUND USD 7000 - FEARNLEYS AS
Handy - Stable demand in the Atlantic offered good rates for the tonnage.
USG/Cont was worth USD 17500 and more. Baltic and Black Sea appeared to ...
Wednesday, 02 May 12
CHINA BLACKOUTS HIGHLIGHT PRICING POLICY WEAKNESS - FITCH
Fitch reported that, the likelihood of further electricity blackouts in China this summer underlines Fitch's view of the basic problem f ...
Tuesday, 01 May 12
VIETNAM FEARS IT MAY NOT SEEK COAL SUPPLIES - TBKTSG / VIETNAMNET BRIDGE
TBKTSG / VietNamNet Bridge reported that, with five coal-run thermopower plants under construction, PetroVietnam alone would need 18 million tons of ...
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- Meralco Power Generation, Philippines
- Siam City Cement PLC, Thailand
- Cigading International Bulk Terminal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Larsen & Toubro Limited - India
- Bangladesh Power Developement Board
- McConnell Dowell - Australia
- Savvy Resources Ltd - HongKong
- Tamil Nadu electricity Board
- Simpson Spence & Young - Indonesia
- Coastal Gujarat Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Orica Australia Pty. Ltd.
- Sree Jayajothi Cements Limited - India
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- Coal and Oil Company - UAE
- Formosa Plastics Group - Taiwan
- GMR Energy Limited - India
- Global Business Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- Vizag Seaport Private Limited - India
- Wilmar Investment Holdings
- Ambuja Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Straits Asia Resources Limited - Singapore
- Riau Bara Harum - Indonesia
- New Zealand Coal & Carbon
- Romanian Commodities Exchange
- Maheswari Brothers Coal Limited - India
- Gujarat Sidhee Cement - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- VISA Power Limited - India
- Indian Oil Corporation Limited
- Edison Trading Spa - Italy
- Sakthi Sugars Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Bharathi Cement Corporation - India
- Essar Steel Hazira Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Grasim Industreis Ltd - India
- Iligan Light & Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Energy Development Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Gujarat Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Malabar Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Ministry of Transport, Egypt
- Banpu Public Company Limited - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Ministry of Mines - Canada
- Indonesian Coal Mining Association
- Trasteel International SA, Italy
- Maharashtra Electricity Regulatory Commission - India
- Karaikal Port Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Sojitz Corporation - Japan
- Chamber of Mines of South Africa
- Gujarat Mineral Development Corp Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Mercuria Energy - Indonesia
- Oldendorff Carriers - Singapore
- Uttam Galva Steels Limited - India
- PTC India Limited - India
- Tata Chemicals Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- The State Trading Corporation of India Ltd
- White Energy Company Limited
- Australian Commodity Traders Exchange
- Petron Corporation, Philippines
- Vedanta Resources Plc - India
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Sinarmas Energy and Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Bhatia International Limited - India
- Kobexindo Tractors - Indoneisa
- Electricity Generating Authority of Thailand
- Globalindo Alam Lestari - Indonesia
- Indogreen Group - Indonesia
- Holcim Trading Pte Ltd - Singapore
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Marubeni Corporation - India
- Sical Logistics Limited - India
- Directorate Of Revenue Intelligence - India
- Planning Commission, India
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- Ministry of Finance - Indonesia
- Goldman Sachs - Singapore
- Madhucon Powers Ltd - India
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- CIMB Investment Bank - Malaysia
- Meenaskhi Energy Private Limited - India
- Georgia Ports Authority, United States
- The University of Queensland
- Parliament of New Zealand
- Minerals Council of Australia
- Parry Sugars Refinery, India
- South Luzon Thermal Energy Corporation
- International Coal Ventures Pvt Ltd - India
- Deloitte Consulting - India
- Kartika Selabumi Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Metalloyd Limited - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- Eastern Coal Council - USA
- CNBM International Corporation - China
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- ICICI Bank Limited - India
- Kaltim Prima Coal - Indonesia
- Xindia Steels Limited - India
- Jaiprakash Power Ventures ltd
- Petrochimia International Co. Ltd.- Taiwan
- Global Coal Blending Company Limited - Australia
- Agrawal Coal Company - India
- Neyveli Lignite Corporation Ltd, - India
- GVK Power & Infra Limited - India
- Merrill Lynch Commodities Europe
- Port Waratah Coal Services - Australia
- Asmin Koalindo Tuhup - Indonesia
- Heidelberg Cement - Germany
- Orica Mining Services - Indonesia
- Price Waterhouse Coopers - Russia
- ASAPP Information Group - India
- London Commodity Brokers - England
- Indian Energy Exchange, India
- Attock Cement Pakistan Limited
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- GN Power Mariveles Coal Plant, Philippines
- Ind-Barath Power Infra Limited - India
- Independent Power Producers Association of India
- Bulk Trading Sa - Switzerland
- Energy Link Ltd, New Zealand
- Thai Mozambique Logistica
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Makarim & Taira - Indonesia
- Electricity Authority, New Zealand
- Therma Luzon, Inc, Philippines
- Semirara Mining Corp, Philippines
- Barasentosa Lestari - Indonesia
- Siam City Cement - Thailand
- Power Finance Corporation Ltd., India
- Pipit Mutiara Jaya. PT, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Mjunction Services Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Energy - Thailand
- Latin American Coal - Colombia
- Australian Coal Association
- Star Paper Mills Limited - India
- Intertek Mineral Services - Indonesia
- Toyota Tsusho Corporation, Japan
- Indika Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Aditya Birla Group - India
- Jindal Steel & Power Ltd - India
- Singapore Mercantile Exchange
- GAC Shipping (India) Pvt Ltd
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- Rio Tinto Coal - Australia
- Videocon Industries ltd - India
- PNOC Exploration Corporation - Philippines
- TeaM Sual Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- MS Steel International - UAE
- Bahari Cakrawala Sebuku - Indonesia
- PowerSource Philippines DevCo
- Wood Mackenzie - Singapore
- Leighton Contractors Pty Ltd - Australia
- Renaissance Capital - South Africa
- Antam Resourcindo - Indonesia
- SMG Consultants - Indonesia
- Central Electricity Authority - India
- Interocean Group of Companies - India
- Anglo American - United Kingdom
- Central Java Power - Indonesia
- Mintek Dendrill Indonesia
- SMC Global Power, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Standard Chartered Bank - UAE
- Baramulti Group, Indonesia
- The Treasury - Australian Government
- Indo Tambangraya Megah - Indonesia
- Manunggal Multi Energi - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Samtan Co., Ltd - South Korea
- Borneo Indobara - Indonesia
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