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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, 11 August 12
INDONESIAN COAL REFERENCE PRICE HAS LOST 27.78 PERCENT YOY
COALspot.com - Indonesian HBA fell again in August.
The monthly coal reference price for coal sales this month fell 3.32 percent. HBA fell ...
Saturday, 11 August 12
SUB-BIT INDONESIA COAL SWAPS SEEN MOVING IN THE RIGHT DIRECTION
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for September 2012 delivery gain 1.29 percent W-o-W on Friday (10 August 2012) closing but lost 1 ...
Friday, 10 August 12
DRY BULK MARKET DROWNING FROM TONNAGE OVERSUPPLY - HELLENIC SHIPPING
The dry bulk market has been overflowing with new building vessels, despite the fact that demand is more or less (and minus the seasonal factors) ri ...
Thursday, 09 August 12
3RD ANNUAL SHALE GAS
Press Release - With the North American shale gas boom, IBC’s 3rd Annual Shale Gas explores optimal strategies to monetize Asia’s domest ...
Wednesday, 08 August 12
EXPLOITASI AIMS TO RAISE RP 2.7T FOR ACQUISITION - THE JAKARTA POST
The Jakarta Post reported that, publicly listed coal miner PT Exploitasi Energi Indonesia (CNKO) is seeking to raise Rp 2.7 trillion (US$286.2 milli ...
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- Intertek Mineral Services - Indonesia
- Romanian Commodities Exchange
- Mercuria Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Rio Tinto Coal - Australia
- Indika Energy - Indonesia
- VISA Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- White Energy Company Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Standard Chartered Bank - UAE
- Attock Cement Pakistan Limited
- Savvy Resources Ltd - HongKong
- Neyveli Lignite Corporation Ltd, - India
- Karaikal Port Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- South Luzon Thermal Energy Corporation
- Ministry of Transport, Egypt
- Ministry of Mines - Canada
- SN Aboitiz Power Inc, Philippines
- Uttam Galva Steels Limited - India
- Formosa Plastics Group - Taiwan
- Kobexindo Tractors - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kideco Jaya Agung - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- The University of Queensland
- Lanco Infratech Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Sree Jayajothi Cements Limited - India
- London Commodity Brokers - England
- PTC India Limited - India
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- European Bulk Services B.V. - Netherlands
- Central Electricity Authority - India
- TeaM Sual Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Africa Commodities Group - South Africa
- Indian Energy Exchange, India
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- Price Waterhouse Coopers - Russia
- Gujarat Electricity Regulatory Commission - India
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Agrawal Coal Company - India
- Vizag Seaport Private Limited - India
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Indogreen Group - Indonesia
- Bukit Makmur.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Malabar Cements Ltd - India
- Bayan Resources Tbk. - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Vedanta Resources Plc - India
- Mjunction Services Limited - India
- Bukit Baiduri Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- Kalimantan Lumbung Energi - Indonesia
- Posco Energy - South Korea
- Thiess Contractors Indonesia
- Power Finance Corporation Ltd., India
- Eastern Coal Council - USA
- Bukit Asam (Persero) Tbk - Indonesia
- Australian Coal Association
- Simpson Spence & Young - Indonesia
- New Zealand Coal & Carbon
- Siam City Cement PLC, Thailand
- LBH Netherlands Bv - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Borneo Indobara - Indonesia
- Bangladesh Power Developement Board
- Star Paper Mills Limited - India
- Directorate General of MIneral and Coal - Indonesia
- McConnell Dowell - Australia
- Coalindo Energy - Indonesia
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Electricity Authority, New Zealand
- Global Business Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- PowerSource Philippines DevCo
- Orica Australia Pty. Ltd.
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Metalloyd Limited - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- Heidelberg Cement - Germany
- Anglo American - United Kingdom
- GMR Energy Limited - India
- Gujarat Mineral Development Corp Ltd - India
- India Bulls Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Samtan Co., Ltd - South Korea
- Indo Tambangraya Megah - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Finance - Indonesia
- International Coal Ventures Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- OPG Power Generation Pvt Ltd - India
- Medco Energi Mining Internasional
- PNOC Exploration Corporation - Philippines
- Mercator Lines Limited - India
- Thai Mozambique Logistica
- Jaiprakash Power Ventures ltd
- Riau Bara Harum - Indonesia
- Kaltim Prima Coal - Indonesia
- IEA Clean Coal Centre - UK
- Bharathi Cement Corporation - India
- Rashtriya Ispat Nigam Limited - India
- Therma Luzon, Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- SMC Global Power, Philippines
- Ambuja Cements Ltd - India
- Aditya Birla Group - India
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Siam City Cement - Thailand
- Sical Logistics Limited - India
- Jindal Steel & Power Ltd - India
- Kepco SPC Power Corporation, Philippines
- Interocean Group of Companies - India
- Chettinad Cement Corporation Ltd - India
- GVK Power & Infra Limited - India
- CNBM International Corporation - China
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- Sojitz Corporation - Japan
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- IHS Mccloskey Coal Group - USA
- Deloitte Consulting - India
- Pipit Mutiara Jaya. PT, Indonesia
- Coal and Oil Company - UAE
- Ind-Barath Power Infra Limited - India
- Oldendorff Carriers - Singapore
- Semirara Mining Corp, Philippines
- ASAPP Information Group - India
- Indian Oil Corporation Limited
- SMG Consultants - Indonesia
- Manunggal Multi Energi - Indonesia
- Kapuas Tunggal Persada - Indonesia
- GAC Shipping (India) Pvt Ltd
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Marubeni Corporation - India
- Georgia Ports Authority, United States
- The State Trading Corporation of India Ltd
- Wilmar Investment Holdings
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- Baramulti Group, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Global Green Power PLC Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Bhushan Steel Limited - India
- Global Coal Blending Company Limited - Australia
- Directorate Of Revenue Intelligence - India
- Sindya Power Generating Company Private Ltd
- MS Steel International - UAE
- Australian Commodity Traders Exchange
- Sarangani Energy Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Dalmia Cement Bharat India
- Latin American Coal - Colombia
- Central Java Power - Indonesia
- Mintek Dendrill Indonesia
- Sakthi Sugars Limited - India
- Eastern Energy - Thailand
- Maharashtra Electricity Regulatory Commission - India
- Antam Resourcindo - Indonesia
- Energy Development Corp, Philippines
- ICICI Bank Limited - India
- Planning Commission, India
- Singapore Mercantile Exchange
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Aboitiz Power Corporation - Philippines
- Commonwealth Bank - Australia
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- Kumho Petrochemical, South Korea
- Salva Resources Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Madhucon Powers Ltd - India
- Altura Mining Limited, Indonesia
- Port Waratah Coal Services - Australia
- Barasentosa Lestari - Indonesia
- Wood Mackenzie - Singapore
- Larsen & Toubro Limited - India
- Electricity Generating Authority of Thailand
- Independent Power Producers Association of India
- Economic Council, Georgia
- Videocon Industries ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
- Kartika Selabumi Mining - Indonesia
- The Treasury - Australian Government
- Petron Corporation, Philippines
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