We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Saturday, 05 January 13
THE SHIPPING MARKET IN 2012 AND LOOKING FORWARD - BIMCO
 Global Economy: Things will go up from here
The global economy continues to grow, albeit at a slower pace than previous years. The slower economic development has been difficult for ship owners who, with a severe overhang of tonnage, have struggled with a depressed freight market since the start of the financial crisis back in 2008. The good news is that both GDP and world trade currently are expected to go up at 3.6% and 4.5% respectively in 2013, which may bring some relief to the shipping industry. The distribution of the global economic recovery will be a decisive factor in how the recovery is going to impact the different shipping segments.
During the second half of 2012, strong political will from the major economies introducing fiscal and monetary policies underpinned the upturn in economic development. However, many of the sustainable growth indicators remain weak, clearly reflecting the fragility in the financial markets. In China, the HSBC/ Markit Manufacturing PMI has been South of the threshold level of 50 throughout the year, indicating a slowdown. However, the November flash report gave rise to some optimism, probably spurred on by yet another economic stimulus. Meanwhile, the Eurozone continues to bear signs of a stand-still, as demand and consumer confidence remain very weak, but there are more positive signals coming from the US that expect a growth beyond 2% also next year.
BIMCO believes that 2013 will be the turning point on the macroeconomic scene. Our baseline scenario is that global GDP will grow stronger in 2013. This is founded in generally easier access to capital led by central banks, positive advocacy vis-à-vis policymakers in e.g. US, EU, Japan and China. This development is welcome and may well be the recipe to more effectively deal with the present challenges. Consumer confidence hinges on the employment situation and will be the catalyst supporting this development, creating demand for goods, housing and energy. In other words, the macroeconomic development should be a positive factor in the shipping markets in 2013, with a key risk being the fragile financial markets, fiscal consolidation in the advanced economies as well as a slowdown in some major emerging economies.
Supply: Overhang of tonnage is a major concern
The collapse of the financial markets in 2008 has taken its toll on ship owners who, in their predictions of a continued high growth in world trade back then, had ordered newbuildings at an unprecedented level. The effects of this overly-optimistic market outlook continue to haunt ship owners, who are trying their best to manage the overhang of tonnage by slow-steaming, idling and recycling. It will be some time before the fundamental supply and demand ratio is balanced. The fleet expansion during 2012 has not improved the situation, as the dry bulk fleet grew by 70 million DWT and the containership fleet by 1.1 million TEU. Fleet expansion in the tanker segments was more moderate, as the products fleet increased by a bit more than 2% and the crude oil fleet by 5%. Looking forward, BIMCO expects that the fleet will grow at a lower rate than the 2012 level. The containership fleet is expected to grow by 7%, the dry bulk fleet by 6%, the crude oil tanker fleet by 4.5% and finally, the product tanker segment is expected to have a judicious growth of 2% for 2013.
The buzzword of the newbuilding market is the so-called ECO-ships, offering potentially large fuel savings compared with the standard ship in the market. The jury is still out regarding the magnitude of the savings, but if the ships are as energy efficient as advertised by the yards, ECO-ships could be a sound business case for ship owners. The deciding factor will be fuel costs, which are not expected to decline. Many of the new ships, especially within the product tanker segment that have been contracted for since mid-2011, have been ordered with an ECO-design.
It is, however, important to emphasise that any major new influx of ships will only create further problems for the industry, considering the already heavy overhang of tonnage. The real challenge is how to optimise the energy efficiency of the current fleet, which age-wise is the youngest ever.
Dry Bulk: Demand is good but is it enough to save the day?
Coming into 2012, freight rates declined significantly and earnings dropped. The Capesize vessels were hurt the most, with freight rates falling below all other segments despite offering much higher cargo capacity. The dip is obviously a direct consequence of the massive overhang of tonnage, coupled with weaker demand.
Towards the end of 2012, demand for iron ore in particular picked up again, as China introduced another large stimulus package with focus on infrastructural developments. Even though this positively impacted the rates, the unsustainable low freight rate levels during most of 2012 proved only sufficient to cover operating expenses, but hardly any capital cost. Going forward, the economic development in China and India will spur demand for power generation, which will lead to increased imports of thermal coal next year. China is likely to import more iron ore in 2013, considering the infrastructure plan coupled with the falling quality of domestically mined iron ore which, all things being equal, will positively affect the demand for tonnage. The supply side is, however, likely to curb the freight rate upturn due to the significant oversupply in the Capesize and Panamax segments.
Tanker: All eyes on the US!
The world’s largest oil consumer, the US, might put downward pressure on seaborne demand in the coming years as the domestic production of oil and natural gas is expected to increase immensely, according to the International Energy Agency. Looking at imports, the extraction of oil sands in Canada means that more than a quarter of US crude oil imports come from their northern neighbour. This trend is unfortunate for the tanker shipping industry, as the large majority of these imports are transported via pipelines rather than tankers. Meanwhile, the shale gas adventures may prompt a shift in the energy mix, not only in US but also globally, towards more natural gas. The threats come on top of a weak crude tanker market, where freight rates this summer reached the lowest point since the miserable days of 2009.
In the oil product tankers sector, freight rates have been depressed throughout most of the year, with the summer months being the low point, but rate hikes during the Autumn and early Winter indicate that a slowly improving market may be in the making, potentially already next year. Things are stirring below the surface, as trade patterns are changing, with traditional importers becoming exporters, notably the US, and also in the spec-trade volumes are going higher.
Looking forward, the prospects of a big-scale North American oil and gas production may favour niche segments such as the LNG tankers outright. LNG tankers make substantial profits at the moment from the arbitrage opportunities arising from the difference in prices of natural gas across the globe. But it will take its toll on the crude and product tanker segments, unless the US significantly increases exports of these products.
Container: Is cascading the solution?
The first half of 2012 developed in the right direction for the liner trades, with rates from Far East to US West Coast rising to USD 2,600 per FEU in June, up from USD 1,800 per FEU in January. Comparably, rates on Far East to Northern Europe climbed from USD 750 per TEU in January to a peak of 1,900 per TEU in June. While the demand side was able to hold rates up in the trans-Pacific trade, rates to Northern Europe fell to touch USD 1,000 per TEU in November, as demand succumbed in the shadow of the Eurozone crisis.
Going forward, the liner segment is about to settle for lower growth rates than those that were once the norm. Globalisation is expected to continue as the main driver, but stronger intra-Asian demand rather than a speedy return to high demand from Europa and US is on the cards for the coming years.
We have seen a steady main trading lane cascading where the Far East – Europe container trade is now largely conducted by Ultra Large Container Vessels (ULCV), a fleet segment that has increased by a staggering 43% so far in 2012, with more to come in 2013. Some segments are being squeezed by the general economy of scale movement in this sector, notably the sub-3,000 TEUs that have accounted for 75% of the overall containership demolition, testifying a cascading to larger ships.
While voyage and operating expenses may just be covered at current rates, they are unfortunately insufficient to fully cover the cost of capital. In an effort to establish reasonable returns on investment, liner companies resort to deactivating routes, laying-up and demolishing tonnage extensively. Going forward, the route to and perspective of recovery will greatly depend on the container trade’s ability to balance the supply side to demand.
Source: Bimco
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 07 December 12
A NEW PHASE FOR AUSTRALIAN RESOURCES - A FITCH STREET INTERVIEW
This week Matt Jamieson spoke with Andrew Colquhoun in Fitch's Asian sovereign rating team, and Vicky Melbourne, Fitch's commodity analyst based i ...
Friday, 07 December 12
SHIPPING INDUSTRY LOOKING ON YET ANOTHER TOUGH YEAR AS WE APPROACH 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With shipping finance "on the ropes" as traditional lenders appear to be cutting their losses and tonnage oversupply still the most import ...
Thursday, 06 December 12
PANAMAX : THE POSITIVE VIBES IN THE ATLANTIC REMAINS - FEARNLEYS AS
Handy
The Atlantic market is still depressed with dearth of cargoes and more ships. The trips from Continent to Feast fixed around USD 12k. Trips f ...
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 commod ...
Tuesday, 04 December 12
JATENERGY SIGNS MOU FOR INDONESIAN COAL ASSET
COALspot.com - Jatenergy Limited has announced that its fully-owned Indonesian subsidiary, PT Barata Energy (BE), has signed an exclusive, non-bindi ...
|
|
|
Showing 4471 to 4475 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- Borneo Indobara - Indonesia
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bhoruka Overseas - Indonesia
- Commonwealth Bank - Australia
- ASAPP Information Group - India
- Sree Jayajothi Cements Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- CNBM International Corporation - China
- Maheswari Brothers Coal Limited - India
- Mercuria Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- Global Coal Blending Company Limited - Australia
- Grasim Industreis Ltd - India
- The Treasury - Australian Government
- Chettinad Cement Corporation Ltd - India
- Coastal Gujarat Power Limited - India
- Indogreen Group - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Posco Energy - South Korea
- Energy Development Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Economic Council, Georgia
- Orica Australia Pty. Ltd.
- Iligan Light & Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- PNOC Exploration Corporation - Philippines
- Essar Steel Hazira Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhatia International Limited - India
- Malabar Cements Ltd - India
- Energy Link Ltd, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Mercator Lines Limited - India
- Savvy Resources Ltd - HongKong
- Globalindo Alam Lestari - Indonesia
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Cement Manufacturers Association - India
- Georgia Ports Authority, United States
- Port Waratah Coal Services - Australia
- Indika Energy - Indonesia
- Petron Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Antam Resourcindo - Indonesia
- VISA Power Limited - India
- San Jose City I Power Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Sakthi Sugars Limited - India
- Kaltim Prima Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- Bharathi Cement Corporation - India
- Banpu Public Company Limited - Thailand
- Uttam Galva Steels Limited - India
- Bangladesh Power Developement Board
- Kobexindo Tractors - Indoneisa
- Orica Mining Services - Indonesia
- Medco Energi Mining Internasional
- Kideco Jaya Agung - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sindya Power Generating Company Private Ltd
- Pendopo Energi Batubara - Indonesia
- Formosa Plastics Group - Taiwan
- Karaikal Port Pvt Ltd - India
- Minerals Council of Australia
- Madhucon Powers Ltd - India
- Semirara Mining Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- PTC India Limited - India
- GMR Energy Limited - India
- Coalindo Energy - Indonesia
- New Zealand Coal & Carbon
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Aditya Birla Group - India
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- White Energy Company Limited
- Kohat Cement Company Ltd. - Pakistan
- Jaiprakash Power Ventures ltd
- Central Java Power - Indonesia
- LBH Netherlands Bv - Netherlands
- Miang Besar Coal Terminal - Indonesia
- Rio Tinto Coal - Australia
- Neyveli Lignite Corporation Ltd, - India
- Standard Chartered Bank - UAE
- Salva Resources Pvt Ltd - India
- Edison Trading Spa - Italy
- TNB Fuel Sdn Bhd - Malaysia
- Goldman Sachs - Singapore
- Tamil Nadu electricity Board
- Central Electricity Authority - India
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- Carbofer General Trading SA - India
- Chamber of Mines of South Africa
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- Australian Coal Association
- ICICI Bank Limited - India
- Ambuja Cements Ltd - India
- Latin American Coal - Colombia
- Renaissance Capital - South Africa
- Ministry of Finance - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Lanco Infratech Ltd - India
- India Bulls Power Limited - India
- Singapore Mercantile Exchange
- AsiaOL BioFuels Corp., Philippines
- The State Trading Corporation of India Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Intertek Mineral Services - Indonesia
- Price Waterhouse Coopers - Russia
- Africa Commodities Group - South Africa
- Karbindo Abesyapradhi - Indoneisa
- Bhushan Steel Limited - India
- Planning Commission, India
- Tata Chemicals Ltd - India
- Barasentosa Lestari - Indonesia
- Ministry of Transport, Egypt
- Timah Investasi Mineral - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Eastern Coal Council - USA
- Billiton Holdings Pty Ltd - Australia
- Wilmar Investment Holdings
- Asmin Koalindo Tuhup - Indonesia
- Bukit Makmur.PT - Indonesia
- Indonesian Coal Mining Association
- Makarim & Taira - Indonesia
- Videocon Industries ltd - India
- Mjunction Services Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Parliament of New Zealand
- Sarangani Energy Corporation, Philippines
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- IHS Mccloskey Coal Group - USA
- PowerSource Philippines DevCo
- Merrill Lynch Commodities Europe
- Oldendorff Carriers - Singapore
- Xindia Steels Limited - India
- Altura Mining Limited, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Electricity Authority, New Zealand
- Ind-Barath Power Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Marubeni Corporation - India
- Ceylon Electricity Board - Sri Lanka
- SMC Global Power, Philippines
- Independent Power Producers Association of India
- Trasteel International SA, Italy
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Baramulti Group, Indonesia
- Manunggal Multi Energi - Indonesia
- Larsen & Toubro Limited - India
- Anglo American - United Kingdom
- Samtan Co., Ltd - South Korea
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Simpson Spence & Young - Indonesia
- Semirara Mining and Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Directorate General of MIneral and Coal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Agrawal Coal Company - India
- Maharashtra Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- MS Steel International - UAE
- Thiess Contractors Indonesia
- Gujarat Sidhee Cement - India
- London Commodity Brokers - England
- Cigading International Bulk Terminal - Indonesia
- Wood Mackenzie - Singapore
- Australian Commodity Traders Exchange
- Siam City Cement - Thailand
- GVK Power & Infra Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sical Logistics Limited - India
- Power Finance Corporation Ltd., India
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Deloitte Consulting - India
- Straits Asia Resources Limited - Singapore
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coal and Oil Company - UAE
- Attock Cement Pakistan Limited
- Kumho Petrochemical, South Korea
- Binh Thuan Hamico - Vietnam
- McConnell Dowell - Australia
- Meralco Power Generation, Philippines
- International Coal Ventures Pvt Ltd - India
- Sojitz Corporation - Japan
|
| |
| |
|
