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Tuesday, 01 October 13
DRY BULK MARKET POISED FOR RETREAT ON CHINA HOLIDAY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The start of a national weeklong in China as of Tuesday is expected to put a lid in the latest rally of the dry bulk freight market, as has always been the case in similar occasions. This trend has already been obvious, by tracking the latest couple of sessions of the industry's benchmark, the Baltic Dry Index. The BDI was down 43 points yesterday, to end at 2,003 points, still more than double than the level of this past summer. The Capesize market witnessed the widest losses, which again was to be expected, given that most of the Capesize business is coming out of China. The BCI (Baltic Capesize Index) was down by 114 points to 3,853. Marginal losses were again obvious in the Panamax market, while smaller ship classes fared better, with Supramaxes rising by 10 points and Handysizes by three points to 1,079 and 597 respectively.
Capt. Jitesh Jaipuriyar, Chief Operating officer with Emerald Maritime, Dubai, offered Hellenic Shipping News Worldwide (www.hellenicshippingnews.com) an insight, regarding this latest rally of the dry bulk market, which has been fuelled by factors both "upstream" and "downstream". In the upstream factors, Capt. Jaipuriyar, noted that "miners are not able to sell at higher costs as there are few “takers”. India and China, as one of the most prospective import economies, are unable to support high raw material prices due to currency devaluation and slow growth combined. However, a miner may not be able to feed supply at the same cost for long as it threatens the very survival. Thus, the importer is forced to pay for high raw material prices which eventually is directly correlated to BDI upswing and supports the rally", he stated.
Regarding downstream factors, Capt. said that "in the current scenario, any increase in prices of raw materials, shall force miners to pass on the rises to the end users, in order to maintain profit margins, especially if this trend continues for an extended period. For shipping to recover, then this period has to be extended. Does it mean that it would bring “Inflationary pressure” in emerging economies? Not necessary. This is because when pressure builds up on downstream, other “balancing factors” shall come into play" he says.
According to Capt. Jaipuriyar, at this stage "the following question arises, if the high raw materials cost shall be able to create a “derived demand” or not. What we see as of now may not be real derived demand but more of a “Pseudo Demand”. Pseudo demand emerges from the constraint of choices a company has when having contracted out spot rates. This will show increased demand through paying more for shipping of the materials. However, the fact remains that companies have to commit to long term contracts (LTCs) and soaring period rates would not allow them to contract ships at lesser Time-Charter equivalents. But LTCs can play ‘Wait and watch’ game. This again contributes to pool of “pseudo demand” to be capitalized later and would support the rally", he says.
BULLWHIP EFFECT & “DECOUPLING”
"Last month, A Capesize stem from Australia to China, cost USD 14 per MT whereas same when slit in two panamaxes, costs only USD 13 per MT. This is against the economy of scale. So, how does it happen? When the demand goes up, a producer goes for bigger volumes and Capes rate go high. Due to limited Capes, the demand for smaller sizes down the chain increases which in effect creates a ‘Bullwhip effect’ to drive the demand for ships and rallies BDI overall.
So, at some point of time, the economic principles “decouple” with existing demand and supply scenario and lead to speculations. This in turn brings in volatility in the market. But the end demand drives it in sustainable way in spite of creation of multiple peaks and troughs on the way.
ROAD AHEAD
There have been many attempts to forecast BDIs in past and will continued to be explored. However, interestingly, it appears that the accuracy of forecasts lies not in “correlation” but possible “negative correlations”. It is for the fact that a positive correlation is not mere a result of one factor but a combination of many. Under such circumstances, it may not be possible to substantiate a proper or perfect “weightage” to one factor or another. But, past shows that gold, CRB (Commodity research bureau index) and crude prices often indicate how the negative correlation is building up and may help forecast BDI for short runs, possibly.
Overall, market remains upbeat for positive growth as stockpiles of grains and coal and other major commodities remain high to be shipped across the geographies", he concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Thursday, 12 September 13
PANAMAX : PACIFIC ROUNDS ARE NOW REPORTED BETWEEN USD 13K AND 15K PER DAY - FEARNRESEARCH
Handy
Nickel ore is a key support SE Asia/Feast rate at the moment; vessel in N.China were fixed around USD 11-12k, ships in mid China can expect a ...
Thursday, 12 September 13
CAPESIZE MARKET WILL BECOME EVEN TIGHTER - JEFFREY LANDSBERG
COALspot.com : While it is no secret that current capesize availability has become tight and has caused capesize rates to surge, availability is set ...
Thursday, 12 September 13
OVER THE WORST? WE MIGHT FIND OUT THIS WEEK - BIMCO
The shipping market has a spring in its step, even as summer draws to a close. There is it seems, confidence that finally, we are emerging into the ...
Thursday, 12 September 13
DRY BULK MARKET RALLY COMES AT A GOOD TIME FOR MOST SHIP OWNERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The latest surge of the dry bulk market has helped offset other lingering factors, which otherwise, could have plunged freight rates to new lows. Fo ...
Wednesday, 11 September 13
ASIA - PACIFIC THERMAL COAL MARKET TO REMAIN OVERSUPPLIED IN NEXT 12 MONTHS - FITCH RATINGS
COALspot.com: Fitch Ratings says the Asia-Pacific thermal coal market will remain oversupplied in the next 12 months because strong production has b ...
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- Bangladesh Power Developement Board
- Directorate Of Revenue Intelligence - India
- Bhushan Steel Limited - India
- Aditya Birla Group - India
- Meralco Power Generation, Philippines
- Maheswari Brothers Coal Limited - India
- Riau Bara Harum - Indonesia
- PNOC Exploration Corporation - Philippines
- Wilmar Investment Holdings
- Indo Tambangraya Megah - Indonesia
- Energy Link Ltd, New Zealand
- Eastern Coal Council - USA
- Merrill Lynch Commodities Europe
- Latin American Coal - Colombia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coal and Oil Company - UAE
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Coal Association
- MS Steel International - UAE
- Eastern Energy - Thailand
- Minerals Council of Australia
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- Kartika Selabumi Mining - Indonesia
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Singapore Mercantile Exchange
- Global Coal Blending Company Limited - Australia
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Price Waterhouse Coopers - Russia
- Kalimantan Lumbung Energi - Indonesia
- Marubeni Corporation - India
- Lanco Infratech Ltd - India
- GMR Energy Limited - India
- Baramulti Group, Indonesia
- Gujarat Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Edison Trading Spa - Italy
- Standard Chartered Bank - UAE
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Globalindo Alam Lestari - Indonesia
- Indian Energy Exchange, India
- Madhucon Powers Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Aboitiz Power Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Makarim & Taira - Indonesia
- Xindia Steels Limited - India
- Sindya Power Generating Company Private Ltd
- Bukit Makmur.PT - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Malabar Cements Ltd - India
- Ministry of Mines - Canada
- Sarangani Energy Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Heidelberg Cement - Germany
- Attock Cement Pakistan Limited
- Orica Mining Services - Indonesia
- Tata Chemicals Ltd - India
- Coastal Gujarat Power Limited - India
- SMC Global Power, Philippines
- Intertek Mineral Services - Indonesia
- Mintek Dendrill Indonesia
- Uttam Galva Steels Limited - India
- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Africa Commodities Group - South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karaikal Port Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- New Zealand Coal & Carbon
- Tamil Nadu electricity Board
- South Luzon Thermal Energy Corporation
- Essar Steel Hazira Ltd - India
- Indika Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- CIMB Investment Bank - Malaysia
- Thiess Contractors Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- ASAPP Information Group - India
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Anglo American - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- VISA Power Limited - India
- Ministry of Transport, Egypt
- Grasim Industreis Ltd - India
- Kideco Jaya Agung - Indonesia
- Antam Resourcindo - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Manunggal Multi Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Power Finance Corporation Ltd., India
- Meenaskhi Energy Private Limited - India
- Sree Jayajothi Cements Limited - India
- Siam City Cement - Thailand
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Kepco SPC Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- Billiton Holdings Pty Ltd - Australia
- Central Java Power - Indonesia
- Cigading International Bulk Terminal - Indonesia
- The Treasury - Australian Government
- Goldman Sachs - Singapore
- Therma Luzon, Inc, Philippines
- Vizag Seaport Private Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- ICICI Bank Limited - India
- Wood Mackenzie - Singapore
- Electricity Generating Authority of Thailand
- Port Waratah Coal Services - Australia
- Economic Council, Georgia
- European Bulk Services B.V. - Netherlands
- Siam City Cement PLC, Thailand
- Georgia Ports Authority, United States
- Star Paper Mills Limited - India
- Gujarat Sidhee Cement - India
- London Commodity Brokers - England
- Jindal Steel & Power Ltd - India
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Bayan Resources Tbk. - Indonesia
- Timah Investasi Mineral - Indoneisa
- Borneo Indobara - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Renaissance Capital - South Africa
- Parry Sugars Refinery, India
- Romanian Commodities Exchange
- TeaM Sual Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- Ind-Barath Power Infra Limited - India
- Kumho Petrochemical, South Korea
- Jaiprakash Power Ventures ltd
- Chamber of Mines of South Africa
- Miang Besar Coal Terminal - Indonesia
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- Straits Asia Resources Limited - Singapore
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Metalloyd Limited - United Kingdom
- Kaltim Prima Coal - Indonesia
- Orica Australia Pty. Ltd.
- India Bulls Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- Agrawal Coal Company - India
- Iligan Light & Power Inc, Philippines
- Indonesian Coal Mining Association
- Carbofer General Trading SA - India
- Indian Oil Corporation Limited
- Bulk Trading Sa - Switzerland
- PTC India Limited - India
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Rashtriya Ispat Nigam Limited - India
- GVK Power & Infra Limited - India
- Videocon Industries ltd - India
- Chettinad Cement Corporation Ltd - India
- Altura Mining Limited, Indonesia
- Global Green Power PLC Corporation, Philippines
- Medco Energi Mining Internasional
- Australian Commodity Traders Exchange
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Toyota Tsusho Corporation, Japan
- Larsen & Toubro Limited - India
- CNBM International Corporation - China
- Salva Resources Pvt Ltd - India
- Central Electricity Authority - India
- Rio Tinto Coal - Australia
- Bhoruka Overseas - Indonesia
- Deloitte Consulting - India
- IHS Mccloskey Coal Group - USA
- Vijayanagar Sugar Pvt Ltd - India
- Thai Mozambique Logistica
- Mjunction Services Limited - India
- Pendopo Energi Batubara - Indonesia
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- The University of Queensland
- Vedanta Resources Plc - India
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