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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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Monday, 31 December 12
"DISTRESSED", "ECO" AND "FINANCE" ARE THE THREE WORDS WHICH CHARACTERIZED 2012 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
2012 was yet another year of speculation, anticipation, pessimism and more speculation in the shipping markets. According to the latest weekly repor ...
Saturday, 29 December 12
SHIPBREAKING YARDS IN INDIA DEMOLISH A TOTAL OF 527 VESSELS IN 2012, BREAKING ALL PREVIOUS RECORDS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
India's ship demolition experts of Star Matrix contemplated this week on the issue of why ships in the range of 1,000 and up to 6,500 liquid tons ( ...
Thursday, 27 December 12
A LOOK AT WORLD TRADE PATTERNS DURING 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
While China's leaders are likely to stick with the 2012 economic growth rate of 7.5% when they chart a course for 2013 - its weakest pace since 199 ...
Thursday, 27 December 12
INDONESIA SHIPPED 33.578* MMT COAL IN NOVEMBER
COALspot.com: Indonesia, the world largest multi grade coal exporter has shipped 33.578* million tons of coal in November 2012. thi ...
Wednesday, 26 December 12
UPDATE ON EXPORT BAN ON RAW MINERALS AND ORE - RITA SUSANTO
COALspot.com - In May 2012, the Minister of Energy and Mineral Resources (“MoEMR”) in Regulation No.7 (“Reg-7”, amended by R ...
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- Carbofer General Trading SA - India
- Mintek Dendrill Indonesia
- Manunggal Multi Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Pendopo Energi Batubara - Indonesia
- Trasteel International SA, Italy
- Maheswari Brothers Coal Limited - India
- Savvy Resources Ltd - HongKong
- Marubeni Corporation - India
- Central Java Power - Indonesia
- Kideco Jaya Agung - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Iligan Light & Power Inc, Philippines
- Ministry of Transport, Egypt
- Merrill Lynch Commodities Europe
- Posco Energy - South Korea
- Eastern Energy - Thailand
- Aditya Birla Group - India
- Deloitte Consulting - India
- Barasentosa Lestari - Indonesia
- Videocon Industries ltd - India
- San Jose City I Power Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Kartika Selabumi Mining - Indonesia
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Orica Australia Pty. Ltd.
- The University of Queensland
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Singapore Mercantile Exchange
- Straits Asia Resources Limited - Singapore
- Attock Cement Pakistan Limited
- Price Waterhouse Coopers - Russia
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Kumho Petrochemical, South Korea
- GAC Shipping (India) Pvt Ltd
- Medco Energi Mining Internasional
- White Energy Company Limited
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Georgia Ports Authority, United States
- Parliament of New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Antam Resourcindo - Indonesia
- Coalindo Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- PowerSource Philippines DevCo
- The Treasury - Australian Government
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Bayan Resources Tbk. - Indonesia
- Xindia Steels Limited - India
- Electricity Authority, New Zealand
- Sindya Power Generating Company Private Ltd
- Madhucon Powers Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Sidhee Cement - India
- Ministry of Finance - Indonesia
- OPG Power Generation Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Rio Tinto Coal - Australia
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Independent Power Producers Association of India
- Electricity Generating Authority of Thailand
- European Bulk Services B.V. - Netherlands
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- Tata Chemicals Ltd - India
- South Luzon Thermal Energy Corporation
- Goldman Sachs - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement - Thailand
- Maharashtra Electricity Regulatory Commission - India
- Vizag Seaport Private Limited - India
- Makarim & Taira - Indonesia
- Indian Oil Corporation Limited
- Asmin Koalindo Tuhup - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Kobexindo Tractors - Indoneisa
- Bukit Baiduri Energy - Indonesia
- SMC Global Power, Philippines
- Global Coal Blending Company Limited - Australia
- Gujarat Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Global Green Power PLC Corporation, Philippines
- GVK Power & Infra Limited - India
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- ICICI Bank Limited - India
- Thai Mozambique Logistica
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Heidelberg Cement - Germany
- GMR Energy Limited - India
- Wilmar Investment Holdings
- ASAPP Information Group - India
- Cement Manufacturers Association - India
- Sinarmas Energy and Mining - Indonesia
- Dalmia Cement Bharat India
- Jaiprakash Power Ventures ltd
- Globalindo Alam Lestari - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Larsen & Toubro Limited - India
- Parry Sugars Refinery, India
- Neyveli Lignite Corporation Ltd, - India
- Planning Commission, India
- Sakthi Sugars Limited - India
- Power Finance Corporation Ltd., India
- Bhushan Steel Limited - India
- Karaikal Port Pvt Ltd - India
- Mercuria Energy - Indonesia
- IEA Clean Coal Centre - UK
- Renaissance Capital - South Africa
- Ambuja Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Interocean Group of Companies - India
- MS Steel International - UAE
- Borneo Indobara - Indonesia
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- International Coal Ventures Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indika Energy - Indonesia
- Bhatia International Limited - India
- Central Electricity Authority - India
- Therma Luzon, Inc, Philippines
- New Zealand Coal & Carbon
- TeaM Sual Corporation - Philippines
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Holcim Trading Pte Ltd - Singapore
- Energy Link Ltd, New Zealand
- Rashtriya Ispat Nigam Limited - India
- Samtan Co., Ltd - South Korea
- Directorate General of MIneral and Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- Binh Thuan Hamico - Vietnam
- PTC India Limited - India
- Commonwealth Bank - Australia
- Agrawal Coal Company - India
- Romanian Commodities Exchange
- Economic Council, Georgia
- Australian Coal Association
- Thiess Contractors Indonesia
- Oldendorff Carriers - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Business Power Corporation, Philippines
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Mjunction Services Limited - India
- LBH Netherlands Bv - Netherlands
- Indogreen Group - Indonesia
- Minerals Council of Australia
- Standard Chartered Bank - UAE
- Malabar Cements Ltd - India
- Uttam Galva Steels Limited - India
- Salva Resources Pvt Ltd - India
- Petron Corporation, Philippines
- Tamil Nadu electricity Board
- Riau Bara Harum - Indonesia
- Latin American Coal - Colombia
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Sree Jayajothi Cements Limited - India
- Indian Energy Exchange, India
- Sarangani Energy Corporation, Philippines
- Grasim Industreis Ltd - India
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Edison Trading Spa - Italy
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Bharathi Cement Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Orica Mining Services - Indonesia
- Meralco Power Generation, Philippines
- McConnell Dowell - Australia
- Timah Investasi Mineral - Indoneisa
- Indonesian Coal Mining Association
- Wood Mackenzie - Singapore
- CNBM International Corporation - China
- Chamber of Mines of South Africa
- Toyota Tsusho Corporation, Japan
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- CIMB Investment Bank - Malaysia
- Port Waratah Coal Services - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Formosa Plastics Group - Taiwan
- India Bulls Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
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