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Thursday, 06 December 12
STRONG CHINESE DEMAND FOR DRY BULK COMMODITIES EXPECTED FOR 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 A new analysis from BIMCO released yesterday suggests that 2013 is expected to be a stronger year in terms of China's "hunger" for commodities like iron ore and coal, which are the main products that larger dry bulk vessels are carrying. According to BIMCO's Chief Shipping Analyst, Peter Sand, "as we are heading into 2013, iron ore demand from the world’s largest consumer, China, is likely to provide a solid lift in demand alongside coal imports in Asia. BIMCO forecast Chinese iron ore imports to grow at a rate of 7.5% in 2013 up from 6.4% in 2012, driven by higher steel demand and the cost of the lower quality domestic ore.”
Statistical data seems to support this prediction. In September China imported the largest amount of iron ore since the record-high imports in January 2011. The 65.01 million tons imported in September strengthens the latest indication of a still growing Chinese demand for imported iron ore. A slight drop in the Chinese steel production from August shows that domestic miners grapple with a low iron content. "While imported iron ore has an average iron content of 63%, the stagnating steel production in China indicated that the implied iron content of domestic ore went south of 10% in September. The average iron content for Chinese iron ore is 14% for 2012. The iron content of Chinese iron ore is calculated residually utilising data on steel production, iron ore production, imports and port inventories. BIMCO calculations show that the Chinese iron ore content has declined since early 2008. This is good news for the dry bulk market, as it implies that the real costs of using domestically produced iron ore has increased" the report said.
It added that "the calculations provide a monthly forecast for iron ore imports, but the overview of the total iron ore input to the steel industry, domestically produced as well as imported is best seen on a quarterly basis where also the falling quality of the domestic ore is highlighted. It is this issue that presents a strong case for growing imports going forward at the expense of domestic production alongside a general growth in steel demand".
BIMCO expects that the monthly imports of iron ore in China will reach an average of 61 million tons in 2012. That number is expected to be higher next year, with a projection of 65 million tons of iron ore monthly. Aside from the declining quality of domestic iron ore, the demand driver for iron ore imports is the continued economic development in China, recently refuelled by the RMB 1 trillion infrastructure investment plans by the Chinese government.
Using a seasonally-adjusted linear expression, we estimate the following development in iron ore imports. The seasonal adjustment is done comparing a 3-month moving average for iron ore imports to a 12-month moving average. The seasonal factor is multiplied by the linear expression to acquire a number for iron ore imports.
As a consequence of the 7-day National Day holiday in early October, a drop in the Chinese steel production led to a fall in iron ore imports that month. According to BIMCO, "we expect imports to grow by a little more than 3 million tons in both November and December, making our 2012 estimate to be 730 million tons for Chinese iron ore imports – or 6.4% year-over-year. For 2013, BIMCO expect that China will increase their imports to 785 million tons – equal to 7.5% year-over-year. Translated into number of vessels, the iron ore import growth this year gives work to 39 Capesize vessels, with work for another 49 Capesize vessels in 2013 (estimating a Capesize that carries iron ore from Australia (2/3) and Brazil (1/3) can transport its cargo capacity 6.8 times a year). The majority of imported iron ore comes from Australia and Brazil. Out of the 57.6 million tons imported in July, more than half came from Australia and around one quarter came from Brazil, according to UN Comtrade. CRSL reports that in week 44, it cost USD10.35 to transport one ton of iron ore from Australia to China, while it cost USD22.45 to transport a ton of iron ore from Brazil to China.
This is still a long way from the happy days of 2008, where ship owners were paid USD50 to transport one ton of iron ore from Australia to China, and as much as USD107 per ton from Brazil to China. As it stands, the Chinese appetite for iron ore ensures that Capesize earnings should stay above an average of USD 9,000 per day in 2013. The reason for this being the positive outlook for iron ore demand as well as expected continuously higher demand for power generation in China and India. In the medium run, coal is likely to be the main contributing factor in boosting the demand side of the dry bulk sector. As laid out in the most recent BIMCO Shipping Market Overview & Outlook, October 2012, imported thermal coal volumes to the three top buyers are expected up by as much as 10%. In the short run, spot rates for transportation of coal may suffer a hit, as stockpiles remain at very high levels up 49% y-o-y, leaving little desire for more coal imports right now, but the stockpile effect may be partially offset by an upwards trend in electricity production as winter is approaching. “When we look into 2013, the fundamentals of the dry bulk segment are improving on both supply and demand side variables. We are still having a tonnage overhang but as we see global GDP improve, demand for dry bulk tonnage is also set to increase driven by surging demand for iron ore and coal. This development should ease the pressure on ship owners and operators” concluded Peter Sand.
Source: Nikos Roussanoglou, Hellenic Shipping
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Tuesday, 15 January 13
GRANT SMITH APPOINTED GROUP MANAGING DIRECTOR OF BRAEMAR ADJUSTING
The Board of Braemar Adjusting is delighted to announce the appointment of Grant Smith as Group Managing Director of the company with immediate effe ...
Tuesday, 15 January 13
2ND MYANMAR MINING SUMMIT & OFFICIAL HOST MINISTRY OF MINES TO WELCOME OVER 200 DELEGATES NEXT WEEK
Press Release: The Ministry of Mines is hosting the 2nd Myanmar Mining Summit in Yangon on 21-24 January to unravel the local mining climate, prospe ...
Monday, 14 January 13
NEWCASTLE PORT SHIPPED 2.32 PERCENT LESS COAL W/E 14 JANUARY 2013
COALspot.com - Newcastle port in Australia has loaded 3,123,312 MT of thermal and coking coal for week ended 0700 hours 14 January 2013, Newca ...
Monday, 14 January 13
THE COAL MONGOLIA - 2013 OFFICIALLY IN COOPERATION WITH TOP MINING COMPANIES
Press Release: Mongolian first mining portal site Mining.mn has already started its preparation of the International Conference “COAL MONGOLIA ...
Monday, 14 January 13
NTPC INVITES BIDS FOR 500K MT OF IMPORTED COAL
COALspot.com - NTPC Limited (formerly National Thermal Power Corporation) is the largest Indian state-owned electric utilities company called for a ...
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- Bukit Baiduri Energy - Indonesia
- Sojitz Corporation - Japan
- Chamber of Mines of South Africa
- Kobexindo Tractors - Indoneisa
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Straits Asia Resources Limited - Singapore
- IHS Mccloskey Coal Group - USA
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Borneo Indobara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vedanta Resources Plc - India
- Gujarat Electricity Regulatory Commission - India
- Baramulti Group, Indonesia
- Sarangani Energy Corporation, Philippines
- Makarim & Taira - Indonesia
- Kaltim Prima Coal - Indonesia
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- Singapore Mercantile Exchange
- Medco Energi Mining Internasional
- Alfred C Toepfer International GmbH - Germany
- Gujarat Sidhee Cement - India
- Directorate Of Revenue Intelligence - India
- Sakthi Sugars Limited - India
- Indo Tambangraya Megah - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sical Logistics Limited - India
- Marubeni Corporation - India
- Tata Chemicals Ltd - India
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- Edison Trading Spa - Italy
- Ministry of Transport, Egypt
- Indonesian Coal Mining Association
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- GMR Energy Limited - India
- OPG Power Generation Pvt Ltd - India
- Trasteel International SA, Italy
- Bukit Asam (Persero) Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Binh Thuan Hamico - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- Antam Resourcindo - Indonesia
- Coalindo Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Petron Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Anglo American - United Kingdom
- Bayan Resources Tbk. - Indonesia
- MS Steel International - UAE
- Kalimantan Lumbung Energi - Indonesia
- Indogreen Group - Indonesia
- McConnell Dowell - Australia
- The State Trading Corporation of India Ltd
- Mjunction Services Limited - India
- Thiess Contractors Indonesia
- Ind-Barath Power Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Star Paper Mills Limited - India
- Billiton Holdings Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Agrawal Coal Company - India
- Interocean Group of Companies - India
- Essar Steel Hazira Ltd - India
- Electricity Authority, New Zealand
- Bhushan Steel Limited - India
- IEA Clean Coal Centre - UK
- Kideco Jaya Agung - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Samtan Co., Ltd - South Korea
- Bulk Trading Sa - Switzerland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ceylon Electricity Board - Sri Lanka
- Port Waratah Coal Services - Australia
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Iligan Light & Power Inc, Philippines
- Xindia Steels Limited - India
- Cigading International Bulk Terminal - Indonesia
- Aditya Birla Group - India
- Bhatia International Limited - India
- Miang Besar Coal Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Larsen & Toubro Limited - India
- VISA Power Limited - India
- Central Java Power - Indonesia
- Orica Mining Services - Indonesia
- Lanco Infratech Ltd - India
- ICICI Bank Limited - India
- PTC India Limited - India
- Riau Bara Harum - Indonesia
- Sinarmas Energy and Mining - Indonesia
- San Jose City I Power Corp, Philippines
- Central Electricity Authority - India
- India Bulls Power Limited - India
- Mercuria Energy - Indonesia
- Energy Development Corp, Philippines
- New Zealand Coal & Carbon
- Malabar Cements Ltd - India
- Bhoruka Overseas - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Georgia Ports Authority, United States
- Bharathi Cement Corporation - India
- Siam City Cement - Thailand
- Wood Mackenzie - Singapore
- Kepco SPC Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Global Business Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Coal and Oil Company - UAE
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- Ministry of Mines - Canada
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- Ambuja Cements Ltd - India
- Cement Manufacturers Association - India
- Intertek Mineral Services - Indonesia
- CNBM International Corporation - China
- Therma Luzon, Inc, Philippines
- Australian Commodity Traders Exchange
- Power Finance Corporation Ltd., India
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Coastal Gujarat Power Limited - India
- Commonwealth Bank - Australia
- Timah Investasi Mineral - Indoneisa
- Globalindo Alam Lestari - Indonesia
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- Parliament of New Zealand
- Maheswari Brothers Coal Limited - India
- Heidelberg Cement - Germany
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Coal Blending Company Limited - Australia
- Parry Sugars Refinery, India
- PowerSource Philippines DevCo
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Pendopo Energi Batubara - Indonesia
- Mintek Dendrill Indonesia
- Thai Mozambique Logistica
- Leighton Contractors Pty Ltd - Australia
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- Meralco Power Generation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asmin Koalindo Tuhup - Indonesia
- Africa Commodities Group - South Africa
- TeaM Sual Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Minerals Council of Australia
- Videocon Industries ltd - India
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Kartika Selabumi Mining - Indonesia
- Madhucon Powers Ltd - India
- Savvy Resources Ltd - HongKong
- Global Green Power PLC Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Jindal Steel & Power Ltd - India
- Posco Energy - South Korea
- Indika Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Romanian Commodities Exchange
- LBH Netherlands Bv - Netherlands
- Eastern Energy - Thailand
- Australian Coal Association
- Latin American Coal - Colombia
- The Treasury - Australian Government
- Karaikal Port Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Indian Oil Corporation Limited
- Electricity Generating Authority of Thailand
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Standard Chartered Bank - UAE
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Sindya Power Generating Company Private Ltd
- SMC Global Power, Philippines
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Independent Power Producers Association of India
- Siam City Cement PLC, Thailand
- Price Waterhouse Coopers - Russia
- Salva Resources Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CIMB Investment Bank - Malaysia
- Energy Link Ltd, New Zealand
- Indian Energy Exchange, India
- Deloitte Consulting - India
- Tamil Nadu electricity Board
- International Coal Ventures Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- White Energy Company Limited
- Sree Jayajothi Cements Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Vizag Seaport Private Limited - India
- The University of Queensland
- Goldman Sachs - Singapore
- Aboitiz Power Corporation - Philippines
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