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Monday, 30 July 12
DRY BULK MARKET TO REMAIN UNDER PRESSURE FOR THE REST OF 2012 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 In an interview with Hellenic Shipping News Worldwide, Mr. Yannis Pachoulis, President of the Hellenic Shipbrokers' Association, remains cautiously optimistic regarding the dry bulk market's long-term prospects. He states that the current downturn was expected, as more and more newbuilding vessels were scheduled to hit the water, on the back of a huge orderbook. He adds that with global dry bulk trade expected to increase exponentially during the next few years, the current oversupply of dry bulk tonnage will be gradually absorbed, thus helping to bring freight rates back to more sustainable levels.
Since the start of the year, we've witnessed a dry bulk market collapse. Why has this occurred? Was the fall expected or did its extent take some under surprise?
Well we cannot name it a ‘collapse’. It is indeed a free fall, but bearing in mind the world’s economy situation together with the oversupply of tonnage due to mass deliveries of newbuildings, ordered during the last five years, brought the tough times of shipping industry we are experiencing now. The fall was expected as the supply of tonnage increased dramatically and broke the balance of supply and demand. I am sure that the prudent owners and brokers have predicted this fall and in most cases were prepared for it.
Is China in a position to be the dry bulk market's powerhouse, like it has been in the past years?
For the last decade China proved to be the dry bulk market’s powerhouse. As the Chinese Government’s 20 years development plan is running , raw materials will be needed, so it will still remain the master powerhouse not only for shipping but for trading also. We have to keep in mind that although the imports of iron ore, which is the primary raw material, might decrease, the imported iron ore is going to be well above half a billion tons. China’s total output in iron ore is estimated to be around 1.5 billion tons this year against 1.33 billion tons in 2011 out of which 686 million tons were imported. It is therefore obvious that China will remain the great source of seaborne trade.
How do you see the market behaving in months until the end of the year? Is a rebound to healthier levels imminent or will ship owners have to be patient and weather the storm?
It’s a good question. Personally, I don’t see great changes till the end of the year – which in my opinion is healthy – of course we are expecting an increase in 4th quarter as it is common in shipping, but nothing extraordinary. The fluctuations of the market will continue and the usual geographical gaps will remain. Shipping as a globalized industry has to be patient, following the international trade market which is showing some optimistic signs, for example the growth of the world trade predicted to reach close to 100 % next 15 years with specific areas like S.America, India, Australia, China, Mexico, African and South East Asian countries expected to play a prime role in future. In the meantime India’s coal imports have already increased during the last three years and expected to have a further increase of approximately 35-36 % in the years to come.
What about demolition activity? Is scrapping activity enough to compensate for part of the newbuilding deliveries?
Demolition is definitely a way to assist the balance of supply and demand. We have already seen a great increase in scrapping activity the last three years. It is obvious that a weak market is leading most of the overaged tonnage to the scrapyards. During 2010 the total dwt scrapped was 28 million tons, 2011 was 42 million tons and the number is growing by nearly 50% during 2012. Scrap prices are still high and owners should take advantage of the prevailing needs and prices and lead their old tonnage to demolition yards, thus giving a chance to their younger tonnage to survive. The average age of scrapped tonnage jumped from 30.5 years in 2010 to 28 years today for dry cargo vessels and 22 years for tankers.
In terms of demand, could other countries like India come to the help of dry bulk ship owners?
As explained hereabove, India’s coal imports are likely to increase from 137 to 185 million tons. Having a target growth rate of 7.5 per cent per year, India seems to be one of the leading countries worldwide in terms of industrial and agricultural infrastructure. And it's not the only one. There are other economies which are giving signs of emerging growth. Russian economy with the known resources, Brazil with the sugar and iron ore trade, Argentina with the grain production, USA and Canada with their industrial and grains products, Australia with the iron ore and coal exports. It’s a promising lot, therefore we should be optimistic for the future of shipping.
Do you expect shipping companies to come under further pressure from banks and lenders in general, with some of them even exiting the market all together?
It all depends on the policy of the banks. There is indeed a pressure, especially to shipowners which purchased their fleet during the very high market of 2006-2008, when the values were sky high. We have recently seen banking and financing organizations to resign from their shipping activities for various reasons, like Commerzbank – being a key player in shipping finance-which decided to exit shipping . But in the meantime we have also experienced refinancing facilities from banks which were not heavily involved in the industry. Hopefully we are not going to see unfortunate events i.e. shipping companies exiting the shipping market due to financial problems created by banks.
Do you believe that the latest fuel regulations regarding ship emissions will ultimately lead to "greener" vessels? Are ship owners looking to build more efficient vessels, or will their preferred solution be to install new engine technologies onboard existing vessels in order to comply with low-sulphur fuel regulations?
Definitely the new fuel regulations are already leading shipowners in building ‘greener’ vessels. Most of the major shipyards have already created new designs of eco-type vessels which will be the leading force in future. Apparently the shipyards following the high bunker prices and the new regulations are trying to create environment friendly vessels with low consumption using, at least in the areas where imposed, the low-sulphur bunkers.
On the other hand the already existing fleet will have to harmonize with the new regulations so the owners have to make all necessary arrangements in order to comply with them, otherwise they are going to face ‘prohibited areas’ in the trade of their ships.
How has the eurozone debt crisis and more importantly the Hellenic financial woes affected your day-to-day business?
We are living in Greece and as Greeks, we are facing the problem of this crisis. It is definitely affecting our life but in the meantime strengthens our will to assist in any possible way our country to overcome this difficulty. Eurozone’s economical situation cannot be considered as smooth. There are different economical levels of the member countries and we have to reach an accepted balance. This is not easy but I strongly believe it can be achieved, provided that there will be understanding from all parties concerned. Our day-to-day business is running normally for the time being but definitely affected, having to live in an uncertain economical environment, but again we are optimistic.
Source: Nikos Roussanoglou, Hellenic Shipping
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Friday, 28 September 12
DRY BULK SECOND HAND VESSELS ON HIGH DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite the demise of the dry bulk market and the collapse of freight rates since the beginning of 2012, on the back of record breaking newbuilding ...
Thursday, 27 September 12
MINING RE-COMMENCES AT ORPHEUS' B2 EAST KALIMANTAN COAL PROJECT
- B2 project overburden removal completed and coal exposed
- Coal getting has commenced with target production of 30,000tpm
- Orpheus to re ...
Thursday, 27 September 12
HANDY: THE PACIFIC MARKET IS GETTING WEAKER WITH UPCOMING GOLDEN WEEK HOLIDAYS - FEARNLEYS AS
Handy
Yet another week with rates softening in all trades. Especially owners with ships open Continent struggle to find employment paying decent mo ...
Thursday, 27 September 12
DRY BULK MARKET LOSES STEAM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The rise of the BDI (Baltic Dry Index), the dry bulk industry’s benchmark during the course of the previous week, proved to be short-lived, as ...
Wednesday, 26 September 12
NEWBUILDING ORDERING ACTIVITY REMAINS SUBDUED ON GLOBAL MARKET UNCERTAINTY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Newbuilding ordering activity has been on the down side during the past few weeks, a trend also noticeable during the course of the past few days, a ...
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- Semirara Mining Corp, Philippines
- Posco Energy - South Korea
- Minerals Council of Australia
- Sinarmas Energy and Mining - Indonesia
- Videocon Industries ltd - India
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sical Logistics Limited - India
- Sarangani Energy Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Sakthi Sugars Limited - India
- CIMB Investment Bank - Malaysia
- Metalloyd Limited - United Kingdom
- Port Waratah Coal Services - Australia
- Cigading International Bulk Terminal - Indonesia
- ASAPP Information Group - India
- Makarim & Taira - Indonesia
- IHS Mccloskey Coal Group - USA
- Indian Oil Corporation Limited
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Pipit Mutiara Jaya. PT, Indonesia
- Georgia Ports Authority, United States
- Commonwealth Bank - Australia
- Electricity Generating Authority of Thailand
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- Bukit Baiduri Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vedanta Resources Plc - India
- Trasteel International SA, Italy
- Latin American Coal - Colombia
- Australian Coal Association
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Bharathi Cement Corporation - India
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- OPG Power Generation Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indonesian Coal Mining Association
- Kumho Petrochemical, South Korea
- Anglo American - United Kingdom
- Salva Resources Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- London Commodity Brokers - England
- Gujarat Sidhee Cement - India
- Star Paper Mills Limited - India
- Thai Mozambique Logistica
- Energy Development Corp, Philippines
- Global Coal Blending Company Limited - Australia
- Ministry of Finance - Indonesia
- Ministry of Mines - Canada
- Medco Energi Mining Internasional
- Orica Australia Pty. Ltd.
- Wilmar Investment Holdings
- Tamil Nadu electricity Board
- Cement Manufacturers Association - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Samtan Co., Ltd - South Korea
- Karbindo Abesyapradhi - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Global Green Power PLC Corporation, Philippines
- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- Baramulti Group, Indonesia
- International Coal Ventures Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Riau Bara Harum - Indonesia
- Economic Council, Georgia
- Bukit Asam (Persero) Tbk - Indonesia
- Merrill Lynch Commodities Europe
- Mercuria Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Sojitz Corporation - Japan
- Wood Mackenzie - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Mineral Development Corp Ltd - India
- Essar Steel Hazira Ltd - India
- Goldman Sachs - Singapore
- Billiton Holdings Pty Ltd - Australia
- Central Java Power - Indonesia
- The University of Queensland
- Jindal Steel & Power Ltd - India
- The State Trading Corporation of India Ltd
- Siam City Cement PLC, Thailand
- Australian Commodity Traders Exchange
- Africa Commodities Group - South Africa
- Price Waterhouse Coopers - Russia
- Indian Energy Exchange, India
- Aditya Birla Group - India
- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- Siam City Cement - Thailand
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- Jorong Barutama Greston.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Malabar Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Aboitiz Power Corporation - Philippines
- Mintek Dendrill Indonesia
- Maharashtra Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Standard Chartered Bank - UAE
- Coalindo Energy - Indonesia
- SMG Consultants - Indonesia
- White Energy Company Limited
- Vijayanagar Sugar Pvt Ltd - India
- VISA Power Limited - India
- Rio Tinto Coal - Australia
- Petron Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Indika Energy - Indonesia
- Formosa Plastics Group - Taiwan
- Power Finance Corporation Ltd., India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- ICICI Bank Limited - India
- Vizag Seaport Private Limited - India
- Therma Luzon, Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Antam Resourcindo - Indonesia
- Indo Tambangraya Megah - Indonesia
- Timah Investasi Mineral - Indoneisa
- Eastern Coal Council - USA
- Lanco Infratech Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Bhoruka Overseas - Indonesia
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Oldendorff Carriers - Singapore
- Alfred C Toepfer International GmbH - Germany
- Kepco SPC Power Corporation, Philippines
- Borneo Indobara - Indonesia
- India Bulls Power Limited - India
- Bulk Trading Sa - Switzerland
- Binh Thuan Hamico - Vietnam
- Savvy Resources Ltd - HongKong
- Indogreen Group - Indonesia
- Electricity Authority, New Zealand
- Iligan Light & Power Inc, Philippines
- Independent Power Producers Association of India
- CNBM International Corporation - China
- Energy Link Ltd, New Zealand
- Simpson Spence & Young - Indonesia
- GAC Shipping (India) Pvt Ltd
- McConnell Dowell - Australia
- Chamber of Mines of South Africa
- Banpu Public Company Limited - Thailand
- MS Steel International - UAE
- Ambuja Cements Ltd - India
- Directorate Of Revenue Intelligence - India
- Jaiprakash Power Ventures ltd
- IEA Clean Coal Centre - UK
- Altura Mining Limited, Indonesia
- Kobexindo Tractors - Indoneisa
- Madhucon Powers Ltd - India
- European Bulk Services B.V. - Netherlands
- South Luzon Thermal Energy Corporation
- Coastal Gujarat Power Limited - India
- Romanian Commodities Exchange
- Thiess Contractors Indonesia
- Ministry of Transport, Egypt
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Bhushan Steel Limited - India
- SN Aboitiz Power Inc, Philippines
- Carbofer General Trading SA - India
- Attock Cement Pakistan Limited
- Miang Besar Coal Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Renaissance Capital - South Africa
- Leighton Contractors Pty Ltd - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- The Treasury - Australian Government
- Larsen & Toubro Limited - India
- Central Electricity Authority - India
- Dalmia Cement Bharat India
- Ceylon Electricity Board - Sri Lanka
- Bangladesh Power Developement Board
- Marubeni Corporation - India
- Parry Sugars Refinery, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Xindia Steels Limited - India
- SMC Global Power, Philippines
- Mercator Lines Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
- Straits Asia Resources Limited - Singapore
- Semirara Mining and Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- GVK Power & Infra Limited - India
- PTC India Limited - India
- Kalimantan Lumbung Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- New Zealand Coal & Carbon
- Singapore Mercantile Exchange
- Bayan Resources Tbk. - Indonesia
- Eastern Energy - Thailand
- Uttam Galva Steels Limited - India
- Maheswari Brothers Coal Limited - India
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