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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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Thursday, 27 September 12
MINING RE-COMMENCES AT ORPHEUS' B2 EAST KALIMANTAN COAL PROJECT
- B2 project overburden removal completed and coal exposed
- Coal getting has commenced with target production of 30,000tpm
- Orpheus to re ...
Thursday, 27 September 12
HANDY: THE PACIFIC MARKET IS GETTING WEAKER WITH UPCOMING GOLDEN WEEK HOLIDAYS - FEARNLEYS AS
Handy
Yet another week with rates softening in all trades. Especially owners with ships open Continent struggle to find employment paying decent mo ...
Thursday, 27 September 12
DRY BULK MARKET LOSES STEAM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The rise of the BDI (Baltic Dry Index), the dry bulk industry’s benchmark during the course of the previous week, proved to be short-lived, as ...
Wednesday, 26 September 12
NEWBUILDING ORDERING ACTIVITY REMAINS SUBDUED ON GLOBAL MARKET UNCERTAINTY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Newbuilding ordering activity has been on the down side during the past few weeks, a trend also noticeable during the course of the past few days, a ...
Sunday, 23 September 12
AN ANOTHER UNSTABLE WEEK FOR INDONESIAN COAL SWAPS
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for November 2012 delivery lost 1.10 percent and 0.916 percent WOW and DOD respectively ...
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- Videocon Industries ltd - India
- Parliament of New Zealand
- Bulk Trading Sa - Switzerland
- Baramulti Group, Indonesia
- Chamber of Mines of South Africa
- Siam City Cement PLC, Thailand
- Coal and Oil Company - UAE
- Parry Sugars Refinery, India
- International Coal Ventures Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Mines - Canada
- Neyveli Lignite Corporation Ltd, - India
- Trasteel International SA, Italy
- Ministry of Transport, Egypt
- Kideco Jaya Agung - Indonesia
- Energy Link Ltd, New Zealand
- Grasim Industreis Ltd - India
- Iligan Light & Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Renaissance Capital - South Africa
- Indika Energy - Indonesia
- CIMB Investment Bank - Malaysia
- CNBM International Corporation - China
- Leighton Contractors Pty Ltd - Australia
- LBH Netherlands Bv - Netherlands
- Ambuja Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- Independent Power Producers Association of India
- Carbofer General Trading SA - India
- Samtan Co., Ltd - South Korea
- Straits Asia Resources Limited - Singapore
- Sinarmas Energy and Mining - Indonesia
- Tamil Nadu electricity Board
- Aditya Birla Group - India
- Planning Commission, India
- Gujarat Sidhee Cement - India
- AsiaOL BioFuels Corp., Philippines
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Wilmar Investment Holdings
- Thai Mozambique Logistica
- White Energy Company Limited
- Sical Logistics Limited - India
- Larsen & Toubro Limited - India
- Banpu Public Company Limited - Thailand
- Standard Chartered Bank - UAE
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- PNOC Exploration Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Commonwealth Bank - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GMR Energy Limited - India
- Jaiprakash Power Ventures ltd
- Krishnapatnam Port Company Ltd. - India
- Merrill Lynch Commodities Europe
- Sindya Power Generating Company Private Ltd
- PowerSource Philippines DevCo
- Mercator Lines Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- Posco Energy - South Korea
- Bukit Baiduri Energy - Indonesia
- Singapore Mercantile Exchange
- Deloitte Consulting - India
- Indian Oil Corporation Limited
- London Commodity Brokers - England
- Marubeni Corporation - India
- Orica Mining Services - Indonesia
- Bhushan Steel Limited - India
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Coastal Gujarat Power Limited - India
- TeaM Sual Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Makarim & Taira - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Central Java Power - Indonesia
- Eastern Energy - Thailand
- Sojitz Corporation - Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Minerals Council of Australia
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Heidelberg Cement - Germany
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- Interocean Group of Companies - India
- Semirara Mining Corp, Philippines
- Price Waterhouse Coopers - Russia
- Directorate Of Revenue Intelligence - India
- Petron Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Therma Luzon, Inc, Philippines
- Barasentosa Lestari - Indonesia
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Ind-Barath Power Infra Limited - India
- Billiton Holdings Pty Ltd - Australia
- Rio Tinto Coal - Australia
- IHS Mccloskey Coal Group - USA
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Bhatia International Limited - India
- Manunggal Multi Energi - Indonesia
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- OPG Power Generation Pvt Ltd - India
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Wood Mackenzie - Singapore
- Meenaskhi Energy Private Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Holcim Trading Pte Ltd - Singapore
- Kapuas Tunggal Persada - Indonesia
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Timah Investasi Mineral - Indoneisa
- SMG Consultants - Indonesia
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- Central Electricity Authority - India
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- South Luzon Thermal Energy Corporation
- Kepco SPC Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Ministry of Finance - Indonesia
- IEA Clean Coal Centre - UK
- San Jose City I Power Corp, Philippines
- Toyota Tsusho Corporation, Japan
- Altura Mining Limited, Indonesia
- ICICI Bank Limited - India
- The University of Queensland
- Borneo Indobara - Indonesia
- Cement Manufacturers Association - India
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Lanco Infratech Ltd - India
- Oldendorff Carriers - Singapore
- Chettinad Cement Corporation Ltd - India
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indo Tambangraya Megah - Indonesia
- Vedanta Resources Plc - India
- Energy Development Corp, Philippines
- Power Finance Corporation Ltd., India
- Indonesian Coal Mining Association
- Global Green Power PLC Corporation, Philippines
- Romanian Commodities Exchange
- Kumho Petrochemical, South Korea
- GN Power Mariveles Coal Plant, Philippines
- Thiess Contractors Indonesia
- Attock Cement Pakistan Limited
- Antam Resourcindo - Indonesia
- Bukit Makmur.PT - Indonesia
- Binh Thuan Hamico - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Maheswari Brothers Coal Limited - India
- Siam City Cement - Thailand
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- Semirara Mining and Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Pendopo Energi Batubara - Indonesia
- Aboitiz Power Corporation - Philippines
- Eastern Coal Council - USA
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Uttam Galva Steels Limited - India
- Mercuria Energy - Indonesia
- Orica Australia Pty. Ltd.
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Anglo American - United Kingdom
- Bangladesh Power Developement Board
- Simpson Spence & Young - Indonesia
- Sree Jayajothi Cements Limited - India
- GAC Shipping (India) Pvt Ltd
- Gujarat Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Mjunction Services Limited - India
- Bharathi Cement Corporation - India
- Mintek Dendrill Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Georgia Ports Authority, United States
- India Bulls Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Miang Besar Coal Terminal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- VISA Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Dalmia Cement Bharat India
- Karaikal Port Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Indogreen Group - Indonesia
- Jindal Steel & Power Ltd - India
- Star Paper Mills Limited - India
- Salva Resources Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- New Zealand Coal & Carbon
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