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Wednesday, 01 January 14
DRY BULK CARRIER OWNERS ANTICIPATING AN EVEN STRONGER 2014 YEAR - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
To begin with, The Hellenic Shipping News Worldwide team would like to wish you all a Happy and Prosperous 2014! We begin the New Year with our first analysis on the dry bulk market. The dry bulk market managed to reach multi year highs over 2013, with the final fourth months of the year, reminiscing of a healthier market. The Baltic Dry Index (BDI) ended the year near its higher point since the 2008 crisis and this is a clear indication of things to come, provided that ship owners don't succumb to the same mistakes of over ordering, like they did last time around.
Newbuilding wise, 2013 proved to be a record breaking year since 2008, but then again, this can be attributed, mostly, on the ship owners' attempt to lower the average cost of their fleet, by investing on newbuilding vessels which come at a much lower price than their 2007-2008 counterparts. As such, and with prices rising again, we cxpect that 2014 will probably not be that "hot", unless of course the pace of freight rates' increase is even higher. In that case, owners could be tempted to continue their newbuilding ordering spree.
In its latest analysis of the market, BIMCO predicted that in the coming weeks, 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 News
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Wednesday, 08 January 14
SHIPPING: THE ABSOLUTE BOTTOM OF THE CYCLE WAS REACHED AND PASSED - GEORGE LAZARIDIS
COALspot.com: To many in the industry 2013 has been the turning point in the market where the absolute bottom of the cycle was reached and passed.
...
Tuesday, 07 January 14
INDONESIA RAISES COAL PRICE THIS MONTH
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia has increased government declared coal bench mark price by US$ 1.59 / MT ...
Tuesday, 07 January 14
NEWCASTLE COAL TERMINAL'S COAL EXPORTS SLIDE TO 3.54 MMT W/E 30 DECEMBER 13
COALspot.com: In the week ended December 30, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled 3.54 ...
Tuesday, 07 January 14
US COAL OUTPUT SLIDES 9 PCT WEEK ON WEEK, EIA SAYS
COALspot.com – United States the world’s second largest coal producer, produced approximately 17.8 million short tons (mmst) of coal in ...
Monday, 06 January 14
ARGUS LAUNCHES SPOT CFR EAST COAST INDIA COAL ASSESSMENTS
COALspot.com: Global energy and commodity news and price reporting agency Argus has announced today that, the company has launched CFR coal assessme ...
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- Parliament of New Zealand
- Thiess Contractors Indonesia
- Thai Mozambique Logistica
- The University of Queensland
- Indogreen Group - Indonesia
- Riau Bara Harum - Indonesia
- IEA Clean Coal Centre - UK
- Ind-Barath Power Infra Limited - India
- MS Steel International - UAE
- India Bulls Power Limited - India
- The State Trading Corporation of India Ltd
- Maheswari Brothers Coal Limited - India
- European Bulk Services B.V. - Netherlands
- Vedanta Resources Plc - India
- Sakthi Sugars Limited - India
- Mintek Dendrill Indonesia
- TeaM Sual Corporation - Philippines
- Bhushan Steel Limited - India
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- International Coal Ventures Pvt Ltd - India
- Carbofer General Trading SA - India
- CIMB Investment Bank - Malaysia
- Semirara Mining and Power Corporation, Philippines
- Malabar Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- Ambuja Cements Ltd - India
- Oldendorff Carriers - Singapore
- Georgia Ports Authority, United States
- Indian Oil Corporation Limited
- Siam City Cement PLC, Thailand
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- GVK Power & Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Wood Mackenzie - Singapore
- White Energy Company Limited
- Petron Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- SMG Consultants - Indonesia
- Manunggal Multi Energi - Indonesia
- Renaissance Capital - South Africa
- Bukit Makmur.PT - Indonesia
- Uttam Galva Steels Limited - India
- Cigading International Bulk Terminal - Indonesia
- Meenaskhi Energy Private Limited - India
- Sojitz Corporation - Japan
- Indonesian Coal Mining Association
- Deloitte Consulting - India
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- Economic Council, Georgia
- Toyota Tsusho Corporation, Japan
- Bahari Cakrawala Sebuku - Indonesia
- The Treasury - Australian Government
- Formosa Plastics Group - Taiwan
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
- Rio Tinto Coal - Australia
- Agrawal Coal Company - India
- Bangladesh Power Developement Board
- IHS Mccloskey Coal Group - USA
- Kohat Cement Company Ltd. - Pakistan
- Semirara Mining Corp, Philippines
- Trasteel International SA, Italy
- OPG Power Generation Pvt Ltd - India
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- Kideco Jaya Agung - Indonesia
- Heidelberg Cement - Germany
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Directorate Of Revenue Intelligence - India
- Minerals Council of Australia
- Kalimantan Lumbung Energi - Indonesia
- Central Electricity Authority - India
- Globalindo Alam Lestari - Indonesia
- Aditya Birla Group - India
- SN Aboitiz Power Inc, Philippines
- Ministry of Mines - Canada
- Marubeni Corporation - India
- Central Java Power - Indonesia
- San Jose City I Power Corp, Philippines
- Binh Thuan Hamico - Vietnam
- Interocean Group of Companies - India
- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- Vizag Seaport Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- Orica Australia Pty. Ltd.
- Attock Cement Pakistan Limited
- Ministry of Finance - Indonesia
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Goldman Sachs - Singapore
- Africa Commodities Group - South Africa
- Coal and Oil Company - UAE
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Essar Steel Hazira Ltd - India
- Latin American Coal - Colombia
- Krishnapatnam Port Company Ltd. - India
- Iligan Light & Power Inc, Philippines
- Videocon Industries ltd - India
- Straits Asia Resources Limited - Singapore
- Savvy Resources Ltd - HongKong
- Barasentosa Lestari - Indonesia
- Eastern Energy - Thailand
- Indo Tambangraya Megah - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- TNB Fuel Sdn Bhd - Malaysia
- Grasim Industreis Ltd - India
- Sree Jayajothi Cements Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Posco Energy - South Korea
- Standard Chartered Bank - UAE
- Australian Coal Association
- Kepco SPC Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Anglo American - United Kingdom
- VISA Power Limited - India
- New Zealand Coal & Carbon
- Cement Manufacturers Association - India
- Petrochimia International Co. Ltd.- Taiwan
- Mercuria Energy - Indonesia
- Makarim & Taira - Indonesia
- PowerSource Philippines DevCo
- Simpson Spence & Young - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wilmar Investment Holdings
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Sical Logistics Limited - India
- Alfred C Toepfer International GmbH - Germany
- Banpu Public Company Limited - Thailand
- Bukit Baiduri Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Rashtriya Ispat Nigam Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Sidhee Cement - India
- Merrill Lynch Commodities Europe
- Karaikal Port Pvt Ltd - India
- GMR Energy Limited - India
- Tata Chemicals Ltd - India
- Borneo Indobara - Indonesia
- GAC Shipping (India) Pvt Ltd
- Chettinad Cement Corporation Ltd - India
- Commonwealth Bank - Australia
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- Baramulti Group, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- Meralco Power Generation, Philippines
- Global Business Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Bharathi Cement Corporation - India
- Holcim Trading Pte Ltd - Singapore
- ICICI Bank Limited - India
- Port Waratah Coal Services - Australia
- Ceylon Electricity Board - Sri Lanka
- Billiton Holdings Pty Ltd - Australia
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Kumho Petrochemical, South Korea
- Xindia Steels Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Bayan Resources Tbk. - Indonesia
- Singapore Mercantile Exchange
- Bulk Trading Sa - Switzerland
- Karbindo Abesyapradhi - Indoneisa
- Jaiprakash Power Ventures ltd
- Mjunction Services Limited - India
- Mercator Lines Limited - India
- Altura Mining Limited, Indonesia
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Indian Energy Exchange, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Power Finance Corporation Ltd., India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kapuas Tunggal Persada - Indonesia
- Timah Investasi Mineral - Indoneisa
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Dalmia Cement Bharat India
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Parry Sugars Refinery, India
- Aboitiz Power Corporation - Philippines
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Electricity Authority, New Zealand
- Romanian Commodities Exchange
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