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Thursday, 27 February 14
SHIPPING LOANS WORTH $5 BILLION HAVE CHANGED HANDS OVER THE PAST YEAR, AS FUNDS INVEST IN SHIPPING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Funds investing in shipping has been the "talk of the town" over the past couple of years, as institutional investors, private equity and hedge funds have all emerged as newcomers to the shipping financing segment, often assuming the role of traditional shipping banks, which have exited the market, or cut their exposure. According to the latest weekly report from shipbroker Intermodal, the vast majority of those funds have been consumed in buying up shipping loans. "About $5 billion in shipping loans have changed hands in the past year and demand is driving loan prices to levels almost in line with book values", said the shipbroker.
According to an analysis by Intermodal's SnP broker George Dermatis, these funds "do not hesitate taking over entire fleets and even align themselves with several managers in an insatiable escapade to take over debts and even ships/assets on their balance sheets. Funds tolerate systemic risk much more than traditional banks that are massively exiting or reducing their exposure in the sector. So one could argue that one player is filling up the void the other creates. Therein lays the paradox" he noted.
Dermatis said that "the characteristics of traditional banks are undoubtedly much more to the liking of traditional shipowners; no exit strategy other than full debt repayment, name lending based on interpersonal relationships, which in some cases dates back decades, experience over several shipping cycles and the list goes on. The industry perceives this as an overall alignment of interests. Private Equity funds stand more or less at the other side of the road on all of these points and that creates nervousness to most being afraid of how fast these investors can climb the learning curve or lose their interest in the process".
According to the broker, "the truth is that shipping largely remains in the hands of its professionals, who live and breathe the essence of this sector and who -to a large extent- have assigned a negative connotation to the publicity that funds along with capital markets and OTC offerings gather. So, despite the fact that financing from these sources has in many times arrived when no other source of funding was available, the truth is that our industry still views them with skepticism. My personal feeling is that people spend too much time “loving or hating” a way of financing whose significance has been grossly overestimated - at least for the time being", Dermatis mentioned.
He went on to add that "despite the fact that numbers -especially last year's- are indeed impressive, it seems that equity funds do not contribute more than $6-7bn on average per year, which seems like a drop in the ocean when compared to conventional debt financing by banks which continues to provide around $250bn annually according to Marine Money. During the peak times of 2008, these figures stood close to $500bn (!!!) and this should therefore be sufficient to hush down fears that private equity alone could lead to a bubble or that it could even distort market reality... The main worry linked to overcapacity remains and the finance gap on newbuilding orders persists if not broadens. The latest available data speaks of figures of over $125bn... Whilst the presence of “new” money is duly noted, we all need to realize that the industry must be able to carry its own weight. If that means changing our processes, transparency levels, corporate responsibility standards, etc. in order to bridge this gap and attract a greater share of their attention, then maybe this is a change we should embrace", Dermatis concluded.
Meanwhile, in the dry bulk market this past week, things continued to improve on the back of rates for the smaller size segments holding on to their levels and those for Capes correcting upwards, said Intermodal, while the spill-overs of the improved sentiment have yet to affect the Panamax market. Nevertheless, the BDI ended yesterday on yet another higher note, ending the session at 1,222 points.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Monday, 10 March 14
THE FREIGHT MARKET WAS QUITE FIRM THIS PAST WEEK
COALspot.com: The freight market was quite firm this past week with BDI sharply increased by 22.65 pct week on week and closed at 1543 points, while ...
Saturday, 08 March 14
LETTERS OF INDEMNITY - SKULD
KNOWLEDGE TO ELEVATE
In today's trading market, owners are frequently requested to accept a letter of indemnity (LOI) in exchange for complying ...
Friday, 07 March 14
DRY BULK MARKET TO BENEFIT FROM CHINA'S GDP GROWTH TARGET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
With the dry bulk market freight rates finally making waves, China's aim of 7.5% GDP growth for 2014 mean once again positive news for the shipping ...
Friday, 07 March 14
RBCT, WORLD'S LARGEST COAL EXPORTING TERMINAL SHIPPED 1.78% LESS COAL MONTH ON MONTH
COALspot.com: South Africa's Richards Bay Coal Terminal (RBCT) the single largest export coal terminal in the world, shipped 4.487 million tons of ...
Friday, 07 March 14
INDONESIA SHIPPED 7% LESS COAL IN JANUARY 2014 COMPARED TO ITS DECEMBER EXPORTS
COALspot.com: Indonesia, the world 4th largest coal producer and the Global largest multi grade coal exporter shipped around $1.8* billion ...
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- Electricity Generating Authority of Thailand
- Electricity Authority, New Zealand
- SMG Consultants - Indonesia
- Medco Energi Mining Internasional
- Tata Chemicals Ltd - India
- Minerals Council of Australia
- Vizag Seaport Private Limited - India
- Lanco Infratech Ltd - India
- Global Coal Blending Company Limited - Australia
- Metalloyd Limited - United Kingdom
- VISA Power Limited - India
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
- Renaissance Capital - South Africa
- Cement Manufacturers Association - India
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Orica Australia Pty. Ltd.
- Siam City Cement PLC, Thailand
- Heidelberg Cement - Germany
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Therma Luzon, Inc, Philippines
- The University of Queensland
- GN Power Mariveles Coal Plant, Philippines
- Jindal Steel & Power Ltd - India
- SMC Global Power, Philippines
- Central Electricity Authority - India
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Meenaskhi Energy Private Limited - India
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- ASAPP Information Group - India
- The Treasury - Australian Government
- Trasteel International SA, Italy
- Simpson Spence & Young - Indonesia
- Essar Steel Hazira Ltd - India
- Eastern Coal Council - USA
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Samtan Co., Ltd - South Korea
- CIMB Investment Bank - Malaysia
- Aditya Birla Group - India
- Bharathi Cement Corporation - India
- Indian Energy Exchange, India
- Kaltim Prima Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Indonesian Coal Mining Association
- Indika Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bayan Resources Tbk. - Indonesia
- Interocean Group of Companies - India
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Kideco Jaya Agung - Indonesia
- Mintek Dendrill Indonesia
- Indian Oil Corporation Limited
- Vedanta Resources Plc - India
- Sical Logistics Limited - India
- Banpu Public Company Limited - Thailand
- Wood Mackenzie - Singapore
- PTC India Limited - India
- Wilmar Investment Holdings
- Merrill Lynch Commodities Europe
- Standard Chartered Bank - UAE
- Karaikal Port Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- London Commodity Brokers - England
- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Videocon Industries ltd - India
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Star Paper Mills Limited - India
- Uttam Galva Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Coalindo Energy - Indonesia
- Mjunction Services Limited - India
- Formosa Plastics Group - Taiwan
- Toyota Tsusho Corporation, Japan
- Aboitiz Power Corporation - Philippines
- CNBM International Corporation - China
- Jaiprakash Power Ventures ltd
- OPG Power Generation Pvt Ltd - India
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rashtriya Ispat Nigam Limited - India
- Ministry of Mines - Canada
- PowerSource Philippines DevCo
- Madhucon Powers Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Bhatia International Limited - India
- Attock Cement Pakistan Limited
- Semirara Mining and Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Indo Tambangraya Megah - Indonesia
- Carbofer General Trading SA - India
- Manunggal Multi Energi - Indonesia
- Energy Link Ltd, New Zealand
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- India Bulls Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Orica Mining Services - Indonesia
- New Zealand Coal & Carbon
- Australian Coal Association
- Xindia Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Romanian Commodities Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- The State Trading Corporation of India Ltd
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Price Waterhouse Coopers - Russia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Ministry of Transport, Egypt
- PetroVietnam Power Coal Import and Supply Company
- Singapore Mercantile Exchange
- Ambuja Cements Ltd - India
- Larsen & Toubro Limited - India
- Gujarat Electricity Regulatory Commission - India
- Gujarat Mineral Development Corp Ltd - India
- Global Business Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- Tamil Nadu electricity Board
- Gujarat Sidhee Cement - India
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- Intertek Mineral Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Energy Development Corp, Philippines
- Ministry of Finance - Indonesia
- San Jose City I Power Corp, Philippines
- Independent Power Producers Association of India
- Alfred C Toepfer International GmbH - Germany
- Kobexindo Tractors - Indoneisa
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- European Bulk Services B.V. - Netherlands
- Global Green Power PLC Corporation, Philippines
- GMR Energy Limited - India
- Africa Commodities Group - South Africa
- ICICI Bank Limited - India
- Planning Commission, India
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Ind-Barath Power Infra Limited - India
- Mercuria Energy - Indonesia
- Commonwealth Bank - Australia
- White Energy Company Limited
- Marubeni Corporation - India
- Antam Resourcindo - Indonesia
- Baramulti Group, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Grasim Industreis Ltd - India
- Power Finance Corporation Ltd., India
- Sarangani Energy Corporation, Philippines
- Thai Mozambique Logistica
- Siam City Cement - Thailand
- Anglo American - United Kingdom
- Borneo Indobara - Indonesia
- Salva Resources Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Bhoruka Overseas - Indonesia
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Kumho Petrochemical, South Korea
- Asmin Koalindo Tuhup - Indonesia
- Port Waratah Coal Services - Australia
- Coastal Gujarat Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Latin American Coal - Colombia
- Rio Tinto Coal - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dalmia Cement Bharat India
- Sindya Power Generating Company Private Ltd
- Indogreen Group - Indonesia
- Edison Trading Spa - Italy
- Central Java Power - Indonesia
- Deloitte Consulting - India
- Eastern Energy - Thailand
- Billiton Holdings Pty Ltd - Australia
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sakthi Sugars Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Makarim & Taira - Indonesia
- Bulk Trading Sa - Switzerland
- Bank of Tokyo Mitsubishi UFJ Ltd
- Semirara Mining Corp, Philippines
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- LBH Netherlands Bv - Netherlands
- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Bangladesh Power Developement Board
- South Luzon Thermal Energy Corporation
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