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Saturday, 03 November 12
DEMOLITION IS THE KEY FOR DRY BULK SHIPPING'S RECOVERY SAYS SHIPBROKER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
 With the number of new building deliveries so far in 2012 already having surpassed the total of 2011, it's more than clear that the dry bulk sector needs more than record demolition activity in order to compensate for the additional tonnage. In other words, older vessels will have to exit the world's fleet in a faster rate, otherwise they will end up competing with their newer counterparts for the same cargoes. According to a recent report from shipbroker Intermodal, more than 1,000 dry bulk carriers have already been delivered since the start of 2012, with over 85 million tons of deadweight capacity and there's two more months until the end of 2012.
According to Intermodal's Theodore Ntalakos, "demolition remains the only alternative for vintage tonnage especially for the bigger vessels. More than 25m tons dwt of dry tonnage have seen the way to the scrapyards, making 2012 another record year in demolition. If we look at demolition versus new deliveries, almost 400 dry bulk carriers have been scrapped representing around 40% of new deliveries. In terms of deadweight, since the new ships are always bigger, demolition is about 30% of the new building deliveries. Although the numbers are more favorable compared to 2011, in 2012 we have seen economies slowing down or even contracting which no doubt has affected global seaborne trade" he said.
We added that "looking at the ratio (demolition/new deliveries) x100 in terms of dwt and in each sub-sector of the dry fleet we can explain and highlight some findings:
Vessels up to 20,000dwt – Demolition is almost 74% of the tonnage or 93% in terms of dwt indicating that this is a sector where the fleet has remained stable.
+ Handysize – the ratio is 55% hinting both the small orderbook as well as the overaged fleet.
+ Handymax/Supramax – the ratio is 22%, showing the limited scraping compared to the very large Supramax orderbook. This number is up from 11% in 2011, which shows that despite the high utilization of this segment, the fleet needs to grow at a slower pace.
+ Panamax – the ratio is 33%, up from 24% in 2011. The lousy rates sent more ships for demo this year, 6.3m tons went for demolition and 19m tons dwt were delivered.
+ Capesize – another poor year for Capesizes explains the fact that scrapings represent almost 40% of new deliveries" he mentioned.
Concluding his argument, Mr. Ntalakos noted that "it feels like demolition activity this year was more of a necessity, not only because the market has remained depressed, but mainly because the future of the older vessels does not look that bright. No doubt the pressure of the orderbook remains enormous and will continue to strangle the market and when world demand subsides, the demolition alone cannot bring the rates back up. As we reach towards the end of 2012, more vessels are coming and surely more demo activity is expected".
Meanwhile, in terms of dry bulk supply, BIMCO noted in a mid-October report that "while our projections for the fleet growth in percentage have remained somewhat steady most of the year, the flows in and out have been much stronger than foreseen at the start of the year. The hectic delivery pace has surpassed the astonishing level of 10 million DWT a month several times, whilst demolition activity has breached the 3 million DWT a month level numerous times too".
The report also examined what can be deduced from this? "Probably that many shipyards are suffering under an intense lack of cash-flow. Whereas the payment structure of the contracts previously were mostly equally distributed or front-heavy from signing to delivery, the contracts that have been made more recently are likely to be back-end loaded, releasing the biggest chunk of the money to the yards closer to the completion and delivery of the ship. This could be one of many explanations that may eventually cause widespread bankruptcies amongst smaller and privately-held yards in the main shipbuilding nations. The active fleet has grown by 8.8% since the turn of the year, as 964 new ships have now been delivered into a fleet that already stood at 8,901 dry bulk carriers at the start of the year. Fortunately, the pressure of 80 million DWT of brand new capacity being poured into the market has been eased to some extent by 375 over aged vessels being demolished.
Ship owners continuously apply the demolition tool generously in order to improve the bad market conditions by cutting down on the supply side. Demolition activity in India, Bangladesh and Pakistan in particular is strong, with lots of dry bulk tonnage sold for breaking. Following the drop in demolition prices from the top in April prices have now moved sideways at a new lower level that has stuck around for some months now. 25 million DWT has now been demolished during 2012 with more to come, assuming that ship owners continue to be tempted by the recycling price level" it concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Saturday, 22 December 12
FALL IN CAPE AND PANAMAX RATES DRAG BDI INDEX - VISTAAR
COALspot.com - The freight market further softened this week closing at 700 points (down by 10.71 pct). The cape index continued to fall and w ...
Saturday, 22 December 12
DELTA DUNIA MAKMUR PRODUCED 3.2 MILLION TONS OF COAL IN NOVEMBER' 12
COALspot.com - PT Delta Dunia Makmur Tbk., has removed 28.1 million bcm* (+1.8% YoY) of Overburden in November 2012 while coal production was at 3.2 ...
Friday, 21 December 12
JORC CODE, 2012 EDITION NOW FINALIZED
COALspot.com - The JORC Committee has announced that, the completion of the review of the JORC Code of 2012 Edition.
The JORC Code, 2012 Ed ...
Thursday, 20 December 12
COAL CLOSING IN ON OIL AS WORLD'S TOP ENERGY SOURCE BY 2017
COALspot.com - Coal’s share of the global energy mix continues to rise, and by 2017 coal will come close to surpassing oil as the world’ ...
Thursday, 20 December 12
CHINA'S IRON ORE AND COAL DEMAND WILL SHAPE THE CAPESIZE DRY BULK TRADE DURING 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite the best efforts from ship owners to help alleviate the current tonnage oversupply issue in the dry bulk segment, especially in the larger v ...
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- Essar Steel Hazira Ltd - India
- Simpson Spence & Young - Indonesia
- Thai Mozambique Logistica
- Carbofer General Trading SA - India
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pendopo Energi Batubara - Indonesia
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Standard Chartered Bank - UAE
- Coastal Gujarat Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Edison Trading Spa - Italy
- Singapore Mercantile Exchange
- Neyveli Lignite Corporation Ltd, - India
- Minerals Council of Australia
- Interocean Group of Companies - India
- IHS Mccloskey Coal Group - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- Power Finance Corporation Ltd., India
- Agrawal Coal Company - India
- Savvy Resources Ltd - HongKong
- Commonwealth Bank - Australia
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- India Bulls Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Banpu Public Company Limited - Thailand
- International Coal Ventures Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Electricity Authority, New Zealand
- Larsen & Toubro Limited - India
- White Energy Company Limited
- GVK Power & Infra Limited - India
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Directorate General of MIneral and Coal - Indonesia
- Anglo American - United Kingdom
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Kaltim Prima Coal - Indonesia
- Siam City Cement PLC, Thailand
- Bhatia International Limited - India
- Indian Energy Exchange, India
- Port Waratah Coal Services - Australia
- Semirara Mining and Power Corporation, Philippines
- Vedanta Resources Plc - India
- Tamil Nadu electricity Board
- SMC Global Power, Philippines
- Makarim & Taira - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Parliament of New Zealand
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- Australian Commodity Traders Exchange
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
- Mjunction Services Limited - India
- Binh Thuan Hamico - Vietnam
- Coalindo Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Ministry of Finance - Indonesia
- Maheswari Brothers Coal Limited - India
- IEA Clean Coal Centre - UK
- Wood Mackenzie - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Aditya Birla Group - India
- Eastern Coal Council - USA
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- ASAPP Information Group - India
- GN Power Mariveles Coal Plant, Philippines
- Bhoruka Overseas - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Wilmar Investment Holdings
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Transport, Egypt
- Barasentosa Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Karaikal Port Pvt Ltd - India
- Eastern Energy - Thailand
- Sinarmas Energy and Mining - Indonesia
- Orica Australia Pty. Ltd.
- Marubeni Corporation - India
- Gujarat Sidhee Cement - India
- Madhucon Powers Ltd - India
- CNBM International Corporation - China
- Ministry of Mines - Canada
- Bulk Trading Sa - Switzerland
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- Mintek Dendrill Indonesia
- SMG Consultants - Indonesia
- Renaissance Capital - South Africa
- CIMB Investment Bank - Malaysia
- Timah Investasi Mineral - Indoneisa
- LBH Netherlands Bv - Netherlands
- Grasim Industreis Ltd - India
- Thiess Contractors Indonesia
- Borneo Indobara - Indonesia
- Petron Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Alfred C Toepfer International GmbH - Germany
- Kideco Jaya Agung - Indonesia
- Uttam Galva Steels Limited - India
- Bayan Resources Tbk. - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- New Zealand Coal & Carbon
- GMR Energy Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- Kumho Petrochemical, South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Formosa Plastics Group - Taiwan
- Parry Sugars Refinery, India
- Australian Coal Association
- Star Paper Mills Limited - India
- AsiaOL BioFuels Corp., Philippines
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Oldendorff Carriers - Singapore
- Kapuas Tunggal Persada - Indonesia
- Rio Tinto Coal - Australia
- Kobexindo Tractors - Indoneisa
- Indonesian Coal Mining Association
- Straits Asia Resources Limited - Singapore
- San Jose City I Power Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Africa Commodities Group - South Africa
- Indian Oil Corporation Limited
- Globalindo Alam Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- SN Aboitiz Power Inc, Philippines
- Bukit Makmur.PT - Indonesia
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Latin American Coal - Colombia
- Semirara Mining Corp, Philippines
- Deloitte Consulting - India
- Manunggal Multi Energi - Indonesia
- The University of Queensland
- Salva Resources Pvt Ltd - India
- Videocon Industries ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Sarangani Energy Corporation, Philippines
- Global Business Power Corporation, Philippines
- Central Electricity Authority - India
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Sakthi Sugars Limited - India
- Siam City Cement - Thailand
- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
- Bangladesh Power Developement Board
- Bukit Asam (Persero) Tbk - Indonesia
- Dalmia Cement Bharat India
- Ambuja Cements Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Meenaskhi Energy Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- TeaM Sual Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- OPG Power Generation Pvt Ltd - India
- Planning Commission, India
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Sical Logistics Limited - India
- Indo Tambangraya Megah - Indonesia
- London Commodity Brokers - England
- Mercuria Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Therma Luzon, Inc, Philippines
- PNOC Exploration Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Jaiprakash Power Ventures ltd
- Electricity Generating Authority of Thailand
- PowerSource Philippines DevCo
- PTC India Limited - India
- Toyota Tsusho Corporation, Japan
- McConnell Dowell - Australia
- GAC Shipping (India) Pvt Ltd
- Central Java Power - Indonesia
- Coal and Oil Company - UAE
- Holcim Trading Pte Ltd - Singapore
- Energy Development Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- The State Trading Corporation of India Ltd
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