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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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Tuesday, 10 September 13
COAL EXPORTS AT AUSTRALIA'S NEWCASTLE PORT SLIP 30.31% ON WEEK TO 2.36 MMT
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port down 30.31 per cent week on week to 2.36 million mt f ...
Tuesday, 10 September 13
WORLDWIDE COAL CONSUMPTION RISES SHARPLY - RA DR. ERICH SCHMITZ
By: RA Dr. Erich Schmitz, Verein der Kohlenimporteure (Germany Coal Importers Association)
World hard coal market in the first half of 2013: worl ...
Monday, 09 September 13
REBOUND IN NEWBUILDING ORDERS HASN'T HURT DRY BULK MARKET PROSPECTS, BUT SHIP OWNERS SHOULD STILL BE CAUTIOUS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Since the start of 2013 and up until the end of August, one thing has really caught the headlines in the dry bulk market, except of course, the frei ...
Sunday, 08 September 13
Q3 2014 THERMAL COAL SWAPS : STEADY DIRECTION
COALspot.com – Sub-Bit Indonesia coal swap (FOB ) for average Q4 2013 delivery up 1.88 percent month on month. The swap was moved ...
Sunday, 08 September 13
BALTIC INDEX UP ON HIGHER CAPESIZE, PANAMAX RATES
COALspot.com : The freight market continued saw one of the biggest rally last week with Cape Size taking the lead followed by Panamax.
The BDI wa ...
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- Madhucon Powers Ltd - India
- Sinarmas Energy and Mining - Indonesia
- GAC Shipping (India) Pvt Ltd
- Iligan Light & Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Wilmar Investment Holdings
- Price Waterhouse Coopers - Russia
- The University of Queensland
- Indian Energy Exchange, India
- Miang Besar Coal Terminal - Indonesia
- Sakthi Sugars Limited - India
- Meralco Power Generation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Carbofer General Trading SA - India
- Pendopo Energi Batubara - Indonesia
- The Treasury - Australian Government
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- Videocon Industries ltd - India
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Marubeni Corporation - India
- Intertek Mineral Services - Indonesia
- European Bulk Services B.V. - Netherlands
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Banpu Public Company Limited - Thailand
- Alfred C Toepfer International GmbH - Germany
- Posco Energy - South Korea
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Siam City Cement PLC, Thailand
- The State Trading Corporation of India Ltd
- Energy Link Ltd, New Zealand
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Essar Steel Hazira Ltd - India
- Singapore Mercantile Exchange
- Lanco Infratech Ltd - India
- Vizag Seaport Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- CNBM International Corporation - China
- Gujarat Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Asmin Koalindo Tuhup - Indonesia
- Metalloyd Limited - United Kingdom
- Indika Energy - Indonesia
- Coal and Oil Company - UAE
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Binh Thuan Hamico - Vietnam
- Eastern Coal Council - USA
- Manunggal Multi Energi - Indonesia
- Star Paper Mills Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Semirara Mining and Power Corporation, Philippines
- Orica Mining Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mercuria Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- San Jose City I Power Corp, Philippines
- Planning Commission, India
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- India Bulls Power Limited - India
- Samtan Co., Ltd - South Korea
- LBH Netherlands Bv - Netherlands
- Cigading International Bulk Terminal - Indonesia
- Indian Oil Corporation Limited
- Energy Development Corp, Philippines
- Gujarat Sidhee Cement - India
- Global Business Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Latin American Coal - Colombia
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- ICICI Bank Limited - India
- MS Steel International - UAE
- Ministry of Mines - Canada
- Ministry of Finance - Indonesia
- Australian Coal Association
- Tamil Nadu electricity Board
- SMG Consultants - Indonesia
- Xindia Steels Limited - India
- Bhatia International Limited - India
- Economic Council, Georgia
- Bukit Baiduri Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Mjunction Services Limited - India
- Savvy Resources Ltd - HongKong
- Attock Cement Pakistan Limited
- Wood Mackenzie - Singapore
- Riau Bara Harum - Indonesia
- Bulk Trading Sa - Switzerland
- International Coal Ventures Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- Simpson Spence & Young - Indonesia
- Chamber of Mines of South Africa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Port Waratah Coal Services - Australia
- Barasentosa Lestari - Indonesia
- Dalmia Cement Bharat India
- Borneo Indobara - Indonesia
- Bukit Makmur.PT - Indonesia
- Parliament of New Zealand
- Electricity Generating Authority of Thailand
- Kalimantan Lumbung Energi - Indonesia
- Bharathi Cement Corporation - India
- Antam Resourcindo - Indonesia
- Petron Corporation, Philippines
- Parry Sugars Refinery, India
- Mintek Dendrill Indonesia
- PTC India Limited - India
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Global Coal Blending Company Limited - Australia
- Central Electricity Authority - India
- Electricity Authority, New Zealand
- Bhoruka Overseas - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- PowerSource Philippines DevCo
- Mercator Lines Limited - India
- Bangladesh Power Developement Board
- Bhushan Steel Limited - India
- Toyota Tsusho Corporation, Japan
- Uttam Galva Steels Limited - India
- Sojitz Corporation - Japan
- Interocean Group of Companies - India
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Trasteel International SA, Italy
- Timah Investasi Mineral - Indoneisa
- Kaltim Prima Coal - Indonesia
- GMR Energy Limited - India
- Grasim Industreis Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Chettinad Cement Corporation Ltd - India
- Directorate Of Revenue Intelligence - India
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Karaikal Port Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Australian Commodity Traders Exchange
- New Zealand Coal & Carbon
- Sical Logistics Limited - India
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- Ministry of Transport, Egypt
- Minerals Council of Australia
- Africa Commodities Group - South Africa
- Romanian Commodities Exchange
- Orica Australia Pty. Ltd.
- Aboitiz Power Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- Altura Mining Limited, Indonesia
- Heidelberg Cement - Germany
- Eastern Energy - Thailand
- PetroVietnam Power Coal Import and Supply Company
- OPG Power Generation Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- South Luzon Thermal Energy Corporation
- Thai Mozambique Logistica
- Salva Resources Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Deloitte Consulting - India
- Vedanta Resources Plc - India
- Merrill Lynch Commodities Europe
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Jaiprakash Power Ventures ltd
- CIMB Investment Bank - Malaysia
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Standard Chartered Bank - UAE
- Power Finance Corporation Ltd., India
- Sindya Power Generating Company Private Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Holcim Trading Pte Ltd - Singapore
- Cement Manufacturers Association - India
- Kepco SPC Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Medco Energi Mining Internasional
- IHS Mccloskey Coal Group - USA
- Rashtriya Ispat Nigam Limited - India
- Maheswari Brothers Coal Limited - India
- Straits Asia Resources Limited - Singapore
- Rio Tinto Coal - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kartika Selabumi Mining - Indonesia
- Tata Chemicals Ltd - India
- Coastal Gujarat Power Limited - India
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Edison Trading Spa - Italy
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
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