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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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Sunday, 04 November 12
SUB-BIT INDONESIA COAL SWAPS FOR DECEMBER' 12 DELIVERY FALLS TO $ 59.78
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for December 2012 delivery fell -1.02 percent on WoW but gained 0.08 percent on D-D on Friday, 2 ...
Saturday, 03 November 12
THE SUPRAMAX FREIGHT EXPECTED TO BE SOFT NEXT WEEK - VISTAAR
COALspot.com - This week the market remained soft with all the sectors soft.
The BDI and was down by 6 pct closing at 986 points. The cape index ...
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 ...
Thursday, 01 November 12
INDONESIA HAS REVISED DOWN ITS 2012 DOMESTIC MARKET OBLIGATION REQUIREMENT FOR COAL
COALspot.com - Minister of Energy and Mineral Resources of Indonesia has revised down its 2012 domestic market obligation requirement due to lower d ...
Thursday, 01 November 12
SOUTH KOREAN POWER UTILITY EWP TO PURCHASE 670,000 MT OF COAL FOR JAN - FEB 2013 DELIVERY
COALspot.com: Korea East-West Power Co. Ltd. on behalf of Korea South-East Power Co. Ltd., Korea Southern Power Co. Ltd., Korea Midland Power Co. Lt ...
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- Jorong Barutama Greston.PT - Indonesia
- Jaiprakash Power Ventures ltd
- Timah Investasi Mineral - Indoneisa
- Makarim & Taira - Indonesia
- Orica Australia Pty. Ltd.
- Malabar Cements Ltd - India
- Aboitiz Power Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Ministry of Mines - Canada
- Vijayanagar Sugar Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- SN Aboitiz Power Inc, Philippines
- Indonesian Coal Mining Association
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Eastern Coal Council - USA
- Videocon Industries ltd - India
- Tamil Nadu electricity Board
- Tata Chemicals Ltd - India
- Independent Power Producers Association of India
- London Commodity Brokers - England
- European Bulk Services B.V. - Netherlands
- Merrill Lynch Commodities Europe
- Gujarat Sidhee Cement - India
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- SMC Global Power, Philippines
- Metalloyd Limited - United Kingdom
- Orica Mining Services - Indonesia
- Karaikal Port Pvt Ltd - India
- Ministry of Finance - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Banpu Public Company Limited - Thailand
- Energy Development Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Madhucon Powers Ltd - India
- Indogreen Group - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dalmia Cement Bharat India
- Australian Coal Association
- CNBM International Corporation - China
- Kideco Jaya Agung - Indonesia
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- McConnell Dowell - Australia
- Bulk Trading Sa - Switzerland
- South Luzon Thermal Energy Corporation
- Uttam Galva Steels Limited - India
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- Trasteel International SA, Italy
- Formosa Plastics Group - Taiwan
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Energy Link Ltd, New Zealand
- Kaltim Prima Coal - Indonesia
- Iligan Light & Power Inc, Philippines
- Central Java Power - Indonesia
- Ministry of Transport, Egypt
- Intertek Mineral Services - Indonesia
- Sical Logistics Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Semirara Mining Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Sree Jayajothi Cements Limited - India
- Romanian Commodities Exchange
- Bangladesh Power Developement Board
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- GN Power Mariveles Coal Plant, Philippines
- Mintek Dendrill Indonesia
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- ASAPP Information Group - India
- Port Waratah Coal Services - Australia
- Samtan Co., Ltd - South Korea
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Oldendorff Carriers - Singapore
- Asmin Koalindo Tuhup - Indonesia
- VISA Power Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Renaissance Capital - South Africa
- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Coastal Gujarat Power Limited - India
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- Chamber of Mines of South Africa
- Sojitz Corporation - Japan
- Meralco Power Generation, Philippines
- PowerSource Philippines DevCo
- Kapuas Tunggal Persada - Indonesia
- ICICI Bank Limited - India
- Mjunction Services Limited - India
- Cement Manufacturers Association - India
- GVK Power & Infra Limited - India
- Ind-Barath Power Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- Binh Thuan Hamico - Vietnam
- Goldman Sachs - Singapore
- Vizag Seaport Private Limited - India
- Grasim Industreis Ltd - India
- Savvy Resources Ltd - HongKong
- Therma Luzon, Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Altura Mining Limited, Indonesia
- International Coal Ventures Pvt Ltd - India
- Anglo American - United Kingdom
- Indian Oil Corporation Limited
- CIMB Investment Bank - Malaysia
- Riau Bara Harum - Indonesia
- Central Electricity Authority - India
- Medco Energi Mining Internasional
- India Bulls Power Limited - India
- Australian Commodity Traders Exchange
- LBH Netherlands Bv - Netherlands
- Wilmar Investment Holdings
- Borneo Indobara - Indonesia
- Global Green Power PLC Corporation, Philippines
- Larsen & Toubro Limited - India
- Aditya Birla Group - India
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- Georgia Ports Authority, United States
- San Jose City I Power Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Bhushan Steel Limited - India
- GMR Energy Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- Planning Commission, India
- Global Business Power Corporation, Philippines
- Petron Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- The University of Queensland
- Pendopo Energi Batubara - Indonesia
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- GAC Shipping (India) Pvt Ltd
- Kalimantan Lumbung Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Siam City Cement PLC, Thailand
- Standard Chartered Bank - UAE
- Lanco Infratech Ltd - India
- Power Finance Corporation Ltd., India
- Maheswari Brothers Coal Limited - India
- Sarangani Energy Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Attock Cement Pakistan Limited
- Antam Resourcindo - Indonesia
- Kobexindo Tractors - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Miang Besar Coal Terminal - Indonesia
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Price Waterhouse Coopers - Russia
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Sinarmas Energy and Mining - Indonesia
- Edison Trading Spa - Italy
- Bharathi Cement Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cigading International Bulk Terminal - Indonesia
- Eastern Energy - Thailand
- PTC India Limited - India
- Xindia Steels Limited - India
- Siam City Cement - Thailand
- Chettinad Cement Corporation Ltd - India
- IHS Mccloskey Coal Group - USA
- Bayan Resources Tbk. - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indian Energy Exchange, India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhatia International Limited - India
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- Gujarat Mineral Development Corp Ltd - India
- Mercator Lines Limited - India
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Petrochimia International Co. Ltd.- Taiwan
- Posco Energy - South Korea
- Mercuria Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The Treasury - Australian Government
- Marubeni Corporation - India
- Bukit Makmur.PT - Indonesia
- Ambuja Cements Ltd - India
- Indika Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Economic Council, Georgia
- MS Steel International - UAE
- Simpson Spence & Young - Indonesia
- Bukit Baiduri Energy - Indonesia
- Interocean Group of Companies - India
- Minerals Council of Australia
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