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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, 30 June 12
THE FREIGHT RATES ARE EXPECTED TO BE STEADY TO FIRM NEXT WEEK - VISTAAR SINGAPORE
COALspot.com – The BDI was up by 2.66 pct (up by 26 points) closing at 1,004 points crossing the 1000 point barrier this week.
The c ...
Friday, 29 June 12
INDONESIAN PRODUCERS ARE PLANNING TO CUT PRODUCTION IF COAL PRICES FALL FURTHER
COALspot.com: Indonesia, the world largest multi grade coal exporter, shipped 31.54* million tons of coal in May 2012, compared to 31.86* mill ...
Friday, 29 June 12
DRY BULK SHIP OWNERS DOING THEIR MATHS BEFORE PLACING NEWBUILDING ORDERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With oversupply having plagued the dry bulk shipping fleet since the end of 2011, it’s become ever so evident that placing a newbuilding order ...
Thursday, 28 June 12
DRY BULK MARKET HIGHER ON CAPESIZE OPTIMISM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market inched a bit higher yesterday, as the BDI (Baltic Dry Index) ended up by 0.71% to 988 points. Most ship types were up, with the ...
Wednesday, 27 June 12
DIRECTORATE GENERAL OF MINERAL AND COAL OF INDONESIA INTRODUCES ON-LINE SYSTEM FOR MINING PRODUCTS EXPORT APPROVAL
COALspot.com - Directorate General of Mineral and Coal of Indonesia has released "Clear and Clean" certificate for another 33 coal miners ...
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- Indika Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Orica Mining Services - Indonesia
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Banpu Public Company Limited - Thailand
- Xindia Steels Limited - India
- Kapuas Tunggal Persada - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Electricity Authority, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Timah Investasi Mineral - Indoneisa
- Tamil Nadu electricity Board
- Latin American Coal - Colombia
- Bayan Resources Tbk. - Indonesia
- Coal and Oil Company - UAE
- Cement Manufacturers Association - India
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- Siam City Cement - Thailand
- Petron Corporation, Philippines
- Ministry of Finance - Indonesia
- Indogreen Group - Indonesia
- Goldman Sachs - Singapore
- Alfred C Toepfer International GmbH - Germany
- Orica Australia Pty. Ltd.
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- Oldendorff Carriers - Singapore
- Global Business Power Corporation, Philippines
- Singapore Mercantile Exchange
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- Siam City Cement PLC, Thailand
- Iligan Light & Power Inc, Philippines
- Semirara Mining Corp, Philippines
- Madhucon Powers Ltd - India
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- Asmin Koalindo Tuhup - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Riau Bara Harum - Indonesia
- Bangladesh Power Developement Board
- Trasteel International SA, Italy
- Miang Besar Coal Terminal - Indonesia
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- PNOC Exploration Corporation - Philippines
- Planning Commission, India
- Baramulti Group, Indonesia
- Independent Power Producers Association of India
- Altura Mining Limited, Indonesia
- McConnell Dowell - Australia
- Indonesian Coal Mining Association
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- Wood Mackenzie - Singapore
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- Kartika Selabumi Mining - Indonesia
- Tata Chemicals Ltd - India
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Billiton Holdings Pty Ltd - Australia
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- Global Coal Blending Company Limited - Australia
- The State Trading Corporation of India Ltd
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Karbindo Abesyapradhi - Indoneisa
- Sarangani Energy Corporation, Philippines
- Mercuria Energy - Indonesia
- The Treasury - Australian Government
- Vijayanagar Sugar Pvt Ltd - India
- Minerals Council of Australia
- Vizag Seaport Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- PowerSource Philippines DevCo
- Antam Resourcindo - Indonesia
- Deloitte Consulting - India
- New Zealand Coal & Carbon
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Barasentosa Lestari - Indonesia
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- White Energy Company Limited
- San Jose City I Power Corp, Philippines
- Bhoruka Overseas - Indonesia
- Carbofer General Trading SA - India
- Cigading International Bulk Terminal - Indonesia
- LBH Netherlands Bv - Netherlands
- Vedanta Resources Plc - India
- Sical Logistics Limited - India
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- PTC India Limited - India
- Commonwealth Bank - Australia
- Jorong Barutama Greston.PT - Indonesia
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- India Bulls Power Limited - India
- Merrill Lynch Commodities Europe
- Ministry of Transport, Egypt
- Chettinad Cement Corporation Ltd - India
- ICICI Bank Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- GVK Power & Infra Limited - India
- Kumho Petrochemical, South Korea
- Gujarat Sidhee Cement - India
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Ind-Barath Power Infra Limited - India
- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- Savvy Resources Ltd - HongKong
- Standard Chartered Bank - UAE
- Central Electricity Authority - India
- VISA Power Limited - India
- Aditya Birla Group - India
- Australian Commodity Traders Exchange
- Gujarat Mineral Development Corp Ltd - India
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- Medco Energi Mining Internasional
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- Sinarmas Energy and Mining - Indonesia
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Sindya Power Generating Company Private Ltd
- The University of Queensland
- Heidelberg Cement - Germany
- Neyveli Lignite Corporation Ltd, - India
- Energy Link Ltd, New Zealand
- Marubeni Corporation - India
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Rio Tinto Coal - Australia
- Ministry of Mines - Canada
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Coal Council - USA
- Price Waterhouse Coopers - Russia
- OPG Power Generation Pvt Ltd - India
- Uttam Galva Steels Limited - India
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kalimantan Lumbung Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Jindal Steel & Power Ltd - India
- Jaiprakash Power Ventures ltd
- Anglo American - United Kingdom
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- Metalloyd Limited - United Kingdom
- MS Steel International - UAE
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Central Java Power - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Economic Council, Georgia
- Renaissance Capital - South Africa
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- Edison Trading Spa - Italy
- Mjunction Services Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- CIMB Investment Bank - Malaysia
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Larsen & Toubro Limited - India
- Kideco Jaya Agung - Indonesia
- Pendopo Energi Batubara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Formosa Plastics Group - Taiwan
- Attock Cement Pakistan Limited
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercator Lines Limited - India
- Romanian Commodities Exchange
- Leighton Contractors Pty Ltd - Australia
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Karaikal Port Pvt Ltd - India
- Parry Sugars Refinery, India
- Bharathi Cement Corporation - India
- Chamber of Mines of South Africa
- SN Aboitiz Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- Agrawal Coal Company - India
- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
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- Global Green Power PLC Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- London Commodity Brokers - England
- Eastern Energy - Thailand
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