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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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- Merrill Lynch Commodities Europe
- Economic Council, Georgia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Anglo American - United Kingdom
- Marubeni Corporation - India
- Xindia Steels Limited - India
- Singapore Mercantile Exchange
- International Coal Ventures Pvt Ltd - India
- Agrawal Coal Company - India
- TNB Fuel Sdn Bhd - Malaysia
- Chamber of Mines of South Africa
- Wilmar Investment Holdings
- Maharashtra Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Tamil Nadu electricity Board
- Karaikal Port Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Indian Energy Exchange, India
- White Energy Company Limited
- Parry Sugars Refinery, India
- Bhoruka Overseas - Indonesia
- Uttam Galva Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Latin American Coal - Colombia
- Ministry of Transport, Egypt
- Australian Coal Association
- Kalimantan Lumbung Energi - Indonesia
- Indian Oil Corporation Limited
- Global Green Power PLC Corporation, Philippines
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- SMG Consultants - Indonesia
- Sree Jayajothi Cements Limited - India
- Cigading International Bulk Terminal - Indonesia
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Bayan Resources Tbk. - Indonesia
- Toyota Tsusho Corporation, Japan
- Planning Commission, India
- Banpu Public Company Limited - Thailand
- Meenaskhi Energy Private Limited - India
- Global Coal Blending Company Limited - Australia
- Directorate General of MIneral and Coal - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Pendopo Energi Batubara - Indonesia
- San Jose City I Power Corp, Philippines
- Riau Bara Harum - Indonesia
- SN Aboitiz Power Inc, Philippines
- Georgia Ports Authority, United States
- PNOC Exploration Corporation - Philippines
- Sical Logistics Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Indonesian Coal Mining Association
- Semirara Mining Corp, Philippines
- Attock Cement Pakistan Limited
- Star Paper Mills Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- Ind-Barath Power Infra Limited - India
- Mercator Lines Limited - India
- Price Waterhouse Coopers - Russia
- Indogreen Group - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Edison Trading Spa - Italy
- Bahari Cakrawala Sebuku - Indonesia
- Interocean Group of Companies - India
- London Commodity Brokers - England
- Central Java Power - Indonesia
- Thai Mozambique Logistica
- Savvy Resources Ltd - HongKong
- Therma Luzon, Inc, Philippines
- SMC Global Power, Philippines
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- PowerSource Philippines DevCo
- Kaltim Prima Coal - Indonesia
- Electricity Authority, New Zealand
- Holcim Trading Pte Ltd - Singapore
- Kumho Petrochemical, South Korea
- The University of Queensland
- Port Waratah Coal Services - Australia
- Indika Energy - Indonesia
- Petron Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Iligan Light & Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Oldendorff Carriers - Singapore
- Wood Mackenzie - Singapore
- Makarim & Taira - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Standard Chartered Bank - UAE
- Baramulti Group, Indonesia
- Bulk Trading Sa - Switzerland
- Mjunction Services Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Renaissance Capital - South Africa
- Deloitte Consulting - India
- Videocon Industries ltd - India
- Commonwealth Bank - Australia
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- GMR Energy Limited - India
- Posco Energy - South Korea
- The Treasury - Australian Government
- Gujarat Sidhee Cement - India
- PetroVietnam Power Coal Import and Supply Company
- AsiaOL BioFuels Corp., Philippines
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Sakthi Sugars Limited - India
- Bangladesh Power Developement Board
- Madhucon Powers Ltd - India
- ASAPP Information Group - India
- New Zealand Coal & Carbon
- Africa Commodities Group - South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Leighton Contractors Pty Ltd - Australia
- Malabar Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- McConnell Dowell - Australia
- Aditya Birla Group - India
- Parliament of New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Goldman Sachs - Singapore
- IHS Mccloskey Coal Group - USA
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- Trasteel International SA, Italy
- Cement Manufacturers Association - India
- Minerals Council of Australia
- Siam City Cement PLC, Thailand
- IEA Clean Coal Centre - UK
- Energy Link Ltd, New Zealand
- Kapuas Tunggal Persada - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Samtan Co., Ltd - South Korea
- Aboitiz Power Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Formosa Plastics Group - Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Kobexindo Tractors - Indoneisa
- Borneo Indobara - Indonesia
- Bukit Makmur.PT - Indonesia
- Independent Power Producers Association of India
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Ceylon Electricity Board - Sri Lanka
- Central Electricity Authority - India
- Chettinad Cement Corporation Ltd - India
- Kartika Selabumi Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Rio Tinto Coal - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Coalindo Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Carbofer General Trading SA - India
- Mintek Dendrill Indonesia
- Ministry of Finance - Indonesia
- Bharathi Cement Corporation - India
- LBH Netherlands Bv - Netherlands
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- India Bulls Power Limited - India
- Grasim Industreis Ltd - India
- GAC Shipping (India) Pvt Ltd
- Larsen & Toubro Limited - India
- Power Finance Corporation Ltd., India
- Australian Commodity Traders Exchange
- Manunggal Multi Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- ICICI Bank Limited - India
- Sindya Power Generating Company Private Ltd
- Romanian Commodities Exchange
- Bhatia International Limited - India
- Sinarmas Energy and Mining - Indonesia
- Heidelberg Cement - Germany
- Asmin Koalindo Tuhup - Indonesia
- Eastern Energy - Thailand
- Intertek Mineral Services - Indonesia
- Meralco Power Generation, Philippines
- Metalloyd Limited - United Kingdom
- VISA Power Limited - India
- Barasentosa Lestari - Indonesia
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- South Luzon Thermal Energy Corporation
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