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Thursday, 12 December 13
DRY BULK MARKET RATES FOR CAPESIZES TO REMAIN VOLATILE SAYS BIMCO
The dry bulk market has reached multi year highs this week, as the BDI is standing at the 2,300-point mark. In its analysis of the market, BIMCO predicted yesterday that the elevated level of Capesize Time Charter average rates will remain volatile and stay around USD 15,000-30,000 per day. Panamax TC average rates will stay in the region of USD 9,000-16,000 per day. For the Supramax segment, BIMCO forecasts freight rates in the USD 11,000-17,000 per day interval, whereas Handysize rates is expected to stay strong in the region of USD 9,000-12,000 per day.
According to the relative report, BIMCO noted that 2013 was a truly amazing year for Chinese iron ore imports. "A growth rate of 10.8% for the first 11 months as compared to the same period last year is solid. Evident also from the freight rate development in the Capesize market, the last 5 months have been exceptional, with 17.8% y-o-y growth for July-November. On top of that, coal imports (not all seaborne) have grown by 15.7% in January-October compared to the same period last year. As we move into a seasonally stronger part of the year for bulk trades, the November and December indications that are already visible point towards more strong numbers.
So far, we have not recorded any major impact on demand due to the announced 3% Chinese import tax on low calorific coal that should be in place now. Indonesia is expected to be affected by this to some extent, as almost all lignite imports into China originate from Indonesia".
It added that "as regards freight rates, the smaller segments of Handysize and Supramax have enjoyed an almost unbroken run of better earnings over a sustained period. Both segments are propelled forward by a strong Atlantic market, mainly driven by front-haul routes out of the US Gulf to Continental Europe and the North Coast of South America, mostly carrying grain.
Not since the middle of last year have we seen average Handysize rates above USD 10,000 per day. For Supramax, the stronger demand has meant average freight rates have gone from USD 10,000 per day to USD 15,000 per day. The 6-month TC rate has also gone up, indicating that the market does not believe this strength is about to instantly evaporate.
However, it will not last for very long if we use the same argument and look at the 1 and 3 year TC rates that have barely moved. When looking at Capesize TC rates, six months deals in the period market were quoted at USD 31,000 in September. As the market fell back during October to stabilise at the USD 15-20,000 per day interval during November, the breakaway in the short period market was neutralised. At the end of November, TC rates, regardless of duration, stood at the same level – indicating uncertainty about the future direction. FFA rates, on the other hand, are not quite as optimistic, but equally volatile when offering around USD 13,000 for a Q1-2014 contract in early December", BIMCO's analysts stated.
Supply
Meanwhile, in terms of tonnage supply, BIMCO said that "the fleet has now grown by 5.3% (55 million DWT) in 2013 with a further 7 million DWT still set for delivery in 2013. This means the full year fleet growth could hit 6% as the higher freight market has limited demolition activity. Since 1 July, just 6.3 million DWT has left the active fleet on that account.
Fleet growth in the Capesize segment has been going steeply South since the middle of last year, where the segment growth during the previous year reached 20%. Since then, the slow inflow of new tonnage in 2013 has left Capesize fleet growth at just 5% in October 2013. Panamax has been the fastest growing segment in 2013, but at a significantly lower peak level than the Capesize segment. It is more positive now for the Handysize segment, which has seen the fleet decrease in size this year as the demolition of 5.5 million DWT has offset the delivery of 5.3 million DWT.
The slowing trend in fleet growth will continue into next year and has not been wiped out completely by the hefty ordering activity we have witnessed in past two months – 136 new ships with a capacity of 13.3 million DWT. Amongst them were 20 VLOCs, 16 Capesizes and 24 Handysizes. Year-to-date contracting activity stand at 63.2 million DWT, this is on course to become higher for the full year than the combined bulk carrier contracting activity during 2011-2012" it said.
Outlook
For 2014, BIMCO expects that demand growth will range between 4½ and 6%, indicating that such strong growth will outstrip supply and bring about an improvement to the fundamental balance. According to BIMCO's head of shipping analysis, Peter Sand, "coal exports from the US have been growing since 2007. However, after a record-setting year in 2012, the numbers appear to be dwindling. Even though March this year set a record with 12.3 million tons, 7% higher than the record set in June 2012, it is not representative of the whole year. The exported total in the first nine months of 2013 is 7.5%, lower than that of the same time last year. Seen on a broader scale, however, the 2013 numbers are still around 100% higher than they were only 4 years ago. In combination with the long sailing distances that most US coal export routes hold, the trade has established itself as a key element in the market, also in the future" he said.
As such, "in the light of lower domestic demand for coal in the US due to the excess production of cheap gas, BIMCO expects US coal producers to become a mainstay in the Atlantic market. Down the road, we may also see coal exports from US West Coast ports.
Going forward, EIA expect US coal exports to remain elevated in 2014 too. Driven by the increased consumption of gas within the US at the expense of coal, producers opt for exporting to Europe and Asia. However, productions costs in the US require relatively high sales prices, and with coal being abundant, particularly in the Asian region, the potential seems to be capped for the near-term future. Despite slower Chinese GDP growth in 2014, commodity imports could very well stay strong. This is due to the factors of diversity in suppliers, lower commodity prices, and the lower quality of domestically produced iron ore and thermal coal", the report concluded.
Source: Nikos Roussanoglou, Hellenic Shipping
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Monday, 13 January 14
INDONESIAN ORE BAN TO HAVE LIMITED IMPACT ON CHINESE ALUMINIUM PRODUCERS, FITCH RATINGS SAYS
COALspot.com: Fitch Ratings says today that Indonesia's ban on exports of unprocessed mineral ore will have limited impact on Chinese aluminium pro ...
Sunday, 12 January 14
THE FREIGHT MARKET CONTINUE TO REMAIN WEAK NEXT WEEK - SOLYM CARRIERS
Wish You A very Happy New Year
COALspot.com: The market has dropped quite a lot as expected due to holidays and probably also the effect of ban o ...
Friday, 10 January 14
DECISION ON ORE EXPORT BAN WILL BE MADE TOMORROW: INDUSTRY MINISTER, JG SAYS
Industry Minister M.S. Hidayat dismissed reports on Thursday that the government had made a decision on the matter. “We will only make a decis ...
Friday, 10 January 14
US COAL PRODUCTION UP 5.8% ON WEEK IN WEEK ENDED SATURDAY 4 JANUARY
COALspot.com – United States the world’s second largest coal producer, produced approximately 18.8 million short tons (mmst) of coal in ...
Thursday, 09 January 14
THE INDONESIAN GOVERNMENT EASES ORE EXPORT BAN
COALspot.com: The Indonesian government has finally agreed to ease the ore-export ban just a few days before the Sunday deadline amid protests from ...
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- Therma Luzon, Inc, Philippines
- Standard Chartered Bank - UAE
- Alfred C Toepfer International GmbH - Germany
- Minerals Council of Australia
- Ind-Barath Power Infra Limited - India
- Indian Energy Exchange, India
- Pendopo Energi Batubara - Indonesia
- Trasteel International SA, Italy
- Sojitz Corporation - Japan
- London Commodity Brokers - England
- Gujarat Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Riau Bara Harum - Indonesia
- SMG Consultants - Indonesia
- Dalmia Cement Bharat India
- Miang Besar Coal Terminal - Indonesia
- Altura Mining Limited, Indonesia
- Australian Commodity Traders Exchange
- Wilmar Investment Holdings
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- Kapuas Tunggal Persada - Indonesia
- Chettinad Cement Corporation Ltd - India
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Electricity Authority, New Zealand
- Samtan Co., Ltd - South Korea
- Mintek Dendrill Indonesia
- Vizag Seaport Private Limited - India
- Central Java Power - Indonesia
- Iligan Light & Power Inc, Philippines
- Edison Trading Spa - Italy
- GN Power Mariveles Coal Plant, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parry Sugars Refinery, India
- Eastern Energy - Thailand
- McConnell Dowell - Australia
- Renaissance Capital - South Africa
- Metalloyd Limited - United Kingdom
- PNOC Exploration Corporation - Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- CNBM International Corporation - China
- Karbindo Abesyapradhi - Indoneisa
- Kartika Selabumi Mining - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Medco Energi Mining Internasional
- Independent Power Producers Association of India
- Indika Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Orica Mining Services - Indonesia
- Jaiprakash Power Ventures ltd
- San Jose City I Power Corp, Philippines
- Ambuja Cements Ltd - India
- Grasim Industreis Ltd - India
- GVK Power & Infra Limited - India
- Petron Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Karaikal Port Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- Oldendorff Carriers - Singapore
- Gujarat Sidhee Cement - India
- Bulk Trading Sa - Switzerland
- Aditya Birla Group - India
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Global Green Power PLC Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Carbofer General Trading SA - India
- Sical Logistics Limited - India
- Jindal Steel & Power Ltd - India
- Wood Mackenzie - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Bharathi Cement Corporation - India
- Indo Tambangraya Megah - Indonesia
- Salva Resources Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Attock Cement Pakistan Limited
- Singapore Mercantile Exchange
- ASAPP Information Group - India
- Port Waratah Coal Services - Australia
- Indonesian Coal Mining Association
- Africa Commodities Group - South Africa
- Simpson Spence & Young - Indonesia
- Bhatia International Limited - India
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- Kideco Jaya Agung - Indonesia
- Bukit Baiduri Energy - Indonesia
- Romanian Commodities Exchange
- Bukit Makmur.PT - Indonesia
- Siam City Cement PLC, Thailand
- Kobexindo Tractors - Indoneisa
- Madhucon Powers Ltd - India
- White Energy Company Limited
- Uttam Galva Steels Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- PowerSource Philippines DevCo
- The State Trading Corporation of India Ltd
- Ministry of Mines - Canada
- Offshore Bulk Terminal Pte Ltd, Singapore
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Savvy Resources Ltd - HongKong
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- Thai Mozambique Logistica
- Lanco Infratech Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Orica Australia Pty. Ltd.
- Energy Development Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- SMC Global Power, Philippines
- Coal and Oil Company - UAE
- Energy Link Ltd, New Zealand
- Makarim & Taira - Indonesia
- Directorate Of Revenue Intelligence - India
- Global Business Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Coalindo Energy - Indonesia
- Electricity Generating Authority of Thailand
- Straits Asia Resources Limited - Singapore
- Marubeni Corporation - India
- South Luzon Thermal Energy Corporation
- Larsen & Toubro Limited - India
- Cigading International Bulk Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Toyota Tsusho Corporation, Japan
- Asmin Koalindo Tuhup - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- PTC India Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Barasentosa Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- MS Steel International - UAE
- IHS Mccloskey Coal Group - USA
- Thiess Contractors Indonesia
- Rio Tinto Coal - Australia
- Kohat Cement Company Ltd. - Pakistan
- Anglo American - United Kingdom
- Essar Steel Hazira Ltd - India
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Parliament of New Zealand
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- Maheswari Brothers Coal Limited - India
- Australian Coal Association
- Billiton Holdings Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Pipit Mutiara Jaya. PT, Indonesia
- Binh Thuan Hamico - Vietnam
- IEA Clean Coal Centre - UK
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Neyveli Lignite Corporation Ltd, - India
- Indogreen Group - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Holcim Trading Pte Ltd - Singapore
- Borneo Indobara - Indonesia
- Meralco Power Generation, Philippines
- Bayan Resources Tbk. - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Cement Manufacturers Association - India
- Vedanta Resources Plc - India
- Videocon Industries ltd - India
- Baramulti Group, Indonesia
- Power Finance Corporation Ltd., India
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Ministry of Transport, Egypt
- Bangladesh Power Developement Board
- Malabar Cements Ltd - India
- Mjunction Services Limited - India
- Interocean Group of Companies - India
- New Zealand Coal & Carbon
- Global Coal Blending Company Limited - Australia
- Eastern Coal Council - USA
- Indian Oil Corporation Limited
- AsiaOL BioFuels Corp., Philippines
- Goldman Sachs - Singapore
- Central Electricity Authority - India
- Xindia Steels Limited - India
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- Sree Jayajothi Cements Limited - India
- Star Paper Mills Limited - India
- Bhushan Steel Limited - India
- Semirara Mining Corp, Philippines
- Kepco SPC Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Antam Resourcindo - Indonesia
- CIMB Investment Bank - Malaysia
- Mercuria Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ministry of Finance - Indonesia
- Sarangani Energy Corporation, Philippines
- The University of Queensland
- Posco Energy - South Korea
- Heidelberg Cement - Germany
- India Bulls Power Limited - India
- Merrill Lynch Commodities Europe
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