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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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Saturday, 01 September 12
PANAMAX FREIGHT RATES UNDER PRESSURE FROM LOW DEMAND - VISTAAR
COALspot.com - This week the freight market was weak with mixed results.
The BDI was down by 1.95 pct closing at 703 points, however there was so ...
Friday, 31 August 12
ADVERSE SHIPPING MARKET CONDITIONS SHORTENS LIFE SPAN OF VESSELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The adverse conditions which have been put in place in the world's freight markets, means that ship owners are forced to scrap vessels of a much yo ...
Thursday, 30 August 12
INDO-INDIA, LARGE ECO SUPRA NOW FIXED AT USD 7K FOR DELIVERY SINGAPORE - FEARNLEYS AS
Handy
The Supra market continued its negative trend with little fresh business entering the market. Continent positions fixed around USD 4k for tri ...
Thursday, 30 August 12
DRY BULK MARKET STILL LOOKING OUT FOR BETTER DAYS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With things in China moving slowly this week, as a result of holidays, it’s no surprise that the latest positive trend in the dry bulk market ...
Wednesday, 29 August 12
COLOMBIA'S MINING BOOM: PART TWO - JOSEPH KIRSCHKE
One of the most prominent casualties of Canada's entry into the Colombian mining sector has been a priest named Jose Reynal-Restrepo. Last Septembe ...
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- Bukit Baiduri Energy - Indonesia
- Anglo American - United Kingdom
- Bhoruka Overseas - Indonesia
- Semirara Mining Corp, Philippines
- ASAPP Information Group - India
- Marubeni Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Siam City Cement - Thailand
- Global Coal Blending Company Limited - Australia
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Aboitiz Power Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- PowerSource Philippines DevCo
- Agrawal Coal Company - India
- Savvy Resources Ltd - HongKong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Coal Association
- Meralco Power Generation, Philippines
- Ministry of Transport, Egypt
- Borneo Indobara - Indonesia
- Jaiprakash Power Ventures ltd
- ICICI Bank Limited - India
- Tata Chemicals Ltd - India
- Grasim Industreis Ltd - India
- Ministry of Finance - Indonesia
- Bhushan Steel Limited - India
- Mercuria Energy - Indonesia
- Xindia Steels Limited - India
- Essar Steel Hazira Ltd - India
- Edison Trading Spa - Italy
- Videocon Industries ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Price Waterhouse Coopers - Russia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- Thiess Contractors Indonesia
- Orica Mining Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Posco Energy - South Korea
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- Meenaskhi Energy Private Limited - India
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Coal and Oil Company - UAE
- Mintek Dendrill Indonesia
- Mercator Lines Limited - India
- Cement Manufacturers Association - India
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- LBH Netherlands Bv - Netherlands
- Indonesian Coal Mining Association
- PNOC Exploration Corporation - Philippines
- Banpu Public Company Limited - Thailand
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- Baramulti Group, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Star Paper Mills Limited - India
- Therma Luzon, Inc, Philippines
- Kumho Petrochemical, South Korea
- Central Electricity Authority - India
- Leighton Contractors Pty Ltd - Australia
- Bulk Trading Sa - Switzerland
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- Kideco Jaya Agung - Indonesia
- Altura Mining Limited, Indonesia
- Lanco Infratech Ltd - India
- Intertek Mineral Services - Indonesia
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Ambuja Cements Ltd - India
- MS Steel International - UAE
- Medco Energi Mining Internasional
- South Luzon Thermal Energy Corporation
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- SMC Global Power, Philippines
- Indika Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Global Green Power PLC Corporation, Philippines
- Coalindo Energy - Indonesia
- Gujarat Sidhee Cement - India
- Carbofer General Trading SA - India
- Port Waratah Coal Services - Australia
- Deloitte Consulting - India
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Energy Development Corp, Philippines
- Planning Commission, India
- Central Java Power - Indonesia
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bangladesh Power Developement Board
- Wood Mackenzie - Singapore
- Toyota Tsusho Corporation, Japan
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
- GAC Shipping (India) Pvt Ltd
- Mjunction Services Limited - India
- Independent Power Producers Association of India
- Eastern Coal Council - USA
- Georgia Ports Authority, United States
- Kartika Selabumi Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Barasentosa Lestari - Indonesia
- Tamil Nadu electricity Board
- Sical Logistics Limited - India
- Heidelberg Cement - Germany
- The University of Queensland
- SN Aboitiz Power Inc, Philippines
- GMR Energy Limited - India
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- San Jose City I Power Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMG Consultants - Indonesia
- Aditya Birla Group - India
- Larsen & Toubro Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Indian Oil Corporation Limited
- Australian Commodity Traders Exchange
- Bharathi Cement Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Antam Resourcindo - Indonesia
- Indogreen Group - Indonesia
- Billiton Holdings Pty Ltd - Australia
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- Minerals Council of Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sindya Power Generating Company Private Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Link Ltd, New Zealand
- Samtan Co., Ltd - South Korea
- Oldendorff Carriers - Singapore
- Sakthi Sugars Limited - India
- Alfred C Toepfer International GmbH - Germany
- Metalloyd Limited - United Kingdom
- Ind-Barath Power Infra Limited - India
- Sojitz Corporation - Japan
- Power Finance Corporation Ltd., India
- Indo Tambangraya Megah - Indonesia
- Dalmia Cement Bharat India
- Commonwealth Bank - Australia
- Renaissance Capital - South Africa
- VISA Power Limited - India
- Maheswari Brothers Coal Limited - India
- Manunggal Multi Energi - Indonesia
- Parliament of New Zealand
- Gujarat Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Wilmar Investment Holdings
- Bayan Resources Tbk. - Indonesia
- TeaM Sual Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Singapore Mercantile Exchange
- CNBM International Corporation - China
- Indian Energy Exchange, India
- GN Power Mariveles Coal Plant, Philippines
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- Globalindo Alam Lestari - Indonesia
- Madhucon Powers Ltd - India
- Thai Mozambique Logistica
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Standard Chartered Bank - UAE
- Economic Council, Georgia
- Merrill Lynch Commodities Europe
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Formosa Plastics Group - Taiwan
- Krishnapatnam Port Company Ltd. - India
- Vedanta Resources Plc - India
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- Bhatia International Limited - India
- Karaikal Port Pvt Ltd - India
- Africa Commodities Group - South Africa
- Trasteel International SA, Italy
- Electricity Authority, New Zealand
- GVK Power & Infra Limited - India
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