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Tuesday, 17 June 14
DRY BULK FREIGHT RATES TO RISE DURING THE SECOND HALF OF 2014, AS CHINA IS EXPECTED TO START IMPORTING MORE IRON ORE FROM BRAZIL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
 In its latest analysis of the dry bulk market, BIMCO said that it doesn’t expect freight rates to react significantly to increased demand before China starts taking more iron ore from Brazil, most likely during the second half of the year,. As a result, BIMCO said that “our forecast for June/July: BIMCO believes that the level of Capesize TC average rates will stay around USD 12,000- 22,000 per day. Panamax TC average rates will feel the supply pressure and stay around USD 4,000-9,000 per day. For the Supramax segment, BIMCO forecasts freight rates in the USD 7,000-12,000 per day interval, whereas Handysize freight rates are expected around USD 6,000-8,500 per day.
According to the market outlook, “a trend has been developing over some years now and going forward, more of the same is expected. This trend is a continued Asia-biased dry bulk market, where China is completely dominant, dwarfing the slow but steady Indian import growth, while the rest of the world only grows imports slowly. Moreover, the trend in commodities became increasingly focused on coal and iron ore trades that are taking an even larger share of the pie going forward. This trend favours the larger bulkers. As the big mines in Australia and Brazil have scaled up iron ore output significantly in 2014 and will do so in the coming two years, the price of the commodity has been under pressure.
Such a development should benefit international trading at the expense of China’s higher-cost, domestically-produced iron ore of poorer quality. Is that what is happening? Yes and no. China has increased its iron ore imports significantly (up by 21% in the first four months of 2014 from a year on) as good merchants buy at the right price, but domestic production keeps up (so far) despite the obvious cost pressure. They are doing so at a very steady level seen during the past 5 years. Conclusion: Don’t expect China to become 100% reliant on imports while enjoying the lower market price. The current iron ore price is around USD 90 per ton, down from 130-140 per ton in H2-2013″, BIMCO noted.
According to BIMCO’s Chief Shipping Analyst, Mr. Peter Sand, the first half of 2013 “was a low and flat freight rate environment, so in that sense so much more has happened in 2014. Normally, volatility is good for operators, but when the past two months have been flat, there is only some comfort in knowing that the year-to-date BDI average is up by 51% (end-May). Below the surface, Capesize earnings are up by 158% to USD 14,504 per day, Panamaxes up by 22% (to USD 9,208 per day), Supramaxes up by 28% (to USD 10,906 per day) and Handysizes up by 26% (to USD 9,181 per day), he noted.
Supply wise, BIMCO’s report said that “the dry bulk fleet has grown by another 121 ships in the past two months (0.9% in DWT). The expansion has been easy in the Capesize segment, with only 10 new deliveries, as compared to roughly 30 new ships flowing into each of the other three sub-segments. For the full year, our estimates have been slightly upwardly adjusted, now to reach 52 million DWT of newbuilt deliveries, meaning that the fleet will grow by 5.3% (up from 49 million DWT).
Order-book activity has been slowing down since January. The order book now holds 1,989 ships (163.4 million DWT) for future delivery and is still heavy on the Panamax side. One hundred and nine ships had left the fleet by the end of May 2014, equal to 6.6 million DWT. During the first five months of 2013 no less than 12.2 million DWT left the fleet. BIMCO remains firm on the forecast of 14 million DWT to be sold for demolition for the full year, significantly down from last years’ 22.2 million DWT. Demolished tonnage is only marginally younger on average this year. With expectations of improved markets just around the corner, BIMCO forecasts lower levels of demolition for the coming years as well”, the report noted.
It added that “the Handysize fleet started to grow again in April, following nine successive months of contraction. The total Handysize fleet remains shy of the record 89.17 million DWT fleet size in 1985, currently at 87.8 million DWT. BIMCO forecasts the Handysize fleet to grow slowly and thus remain South of the record size in 2014 and potentially in 2015 too.
In opposition to this is the Panamax segment, which with little hesitation, sets a new fleet size record every day. Currently growing at 8.7% on a year-on-year basis, standing at 191 million DWT at the end of May, the 200 million DWT fleet size threshold is likely to be reached before year-end”, BIMCO said.
Demand
Demand-wise South American grain exports finally got under way. According to BIMCO, “the lower export figures from April being only on a par with 2012 illustrates the delayed take-off in shipments. Brazil has been the major exporter during Q2, while Argentina delivered more steadily throughout Q2 and Q3. Ship broking company SSY expects a combined 35.8 million tons (mt) of soya exports in Q2, with 30.8 mt in Q3.
The strength of the current upturn depends on Asia’s appetite, as all growth stems from that region. The Atlantic basin has been awash with ships during most of 2014, putting downward pressure on freight rates for Panamax and Supramax ships in particular. Freight rates for a trans-Atlantic round-voyage, which were hitting a three-year high by mid-December 2013 (USD 20,500 per day), subsequently experienced four straight months of losses to hit USD 2,500 per day for Panamaxes. Since mid-April, Panamaxes have tripled earnings on the back of demand, finally meeting expectations. Supramax ships are still in the doldrums, failing to follow suit with big brother so far.
The optimism built up in H2-2013 has all but evaporated. BIMCO still expects stronger earnings as we enter into H2-2014, but the world fleet is capable of catering to a much higher level of demand than it does today. This is what makes the road forward full of air pockets, with owners and operators trying to hit the optimum speed in a quest to utilise their ships better”, BIMCO concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Sunday, 15 June 14
COAL FREIGHT RATES FALL FURTHER ON LACK OF DEMANDS - CAPT. REDDY
COALspot.com: The BDI softened this week as all segments fell this week. The Panamax sector being most affected. The Cape index was down 3.51 pct w ...
Friday, 13 June 14
US COAL PRODUCTION FELL 3% IN WEEK THAT ENDED JUNE 7, SAYS EIA
COALspot.com – United States the world's second largest coal producer, produced approximately 18.6 million short tons (mmst) of coal in a ...
Friday, 13 June 14
DRY BULK MARKET KEEPS ON FALLING, DESPITE RESPITE OF THE CAPESIZE SECTOR - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has kept on its lacklustre performance overall, with the Baltic Dry Index (BDI) still hovering below the 1,000 point mark. Yest ...
Thursday, 12 June 14
INDONESIA SETS HBA FOR MONTH OF JUNE AT US$ 73.64
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia has revised up first time in last four months the coal bench mark price. ...
Thursday, 12 June 14
HANDY : TA MARKET IS CONTINUING SOUTH WITH A DECREASE OF 26% W-O-W
Handy
The week started off with holidays in most European countries and the TA market is continuing south with a decrease of 26% w-o-w. We do see ...
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- Coalindo Energy - Indonesia
- Agrawal Coal Company - India
- Pipit Mutiara Jaya. PT, Indonesia
- MS Steel International - UAE
- Interocean Group of Companies - India
- VISA Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- Rashtriya Ispat Nigam Limited - India
- GMR Energy Limited - India
- Power Finance Corporation Ltd., India
- Grasim Industreis Ltd - India
- Bukit Makmur.PT - Indonesia
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- PNOC Exploration Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Siam City Cement - Thailand
- Bayan Resources Tbk. - Indonesia
- Petron Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- ICICI Bank Limited - India
- Baramulti Group, Indonesia
- Ministry of Mines - Canada
- SMG Consultants - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Essar Steel Hazira Ltd - India
- Goldman Sachs - Singapore
- Electricity Authority, New Zealand
- Orica Australia Pty. Ltd.
- Borneo Indobara - Indonesia
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Krishnapatnam Port Company Ltd. - India
- Coal and Oil Company - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PTC India Limited - India
- Directorate Of Revenue Intelligence - India
- Merrill Lynch Commodities Europe
- Kideco Jaya Agung - Indonesia
- Videocon Industries ltd - India
- Kapuas Tunggal Persada - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Attock Cement Pakistan Limited
- India Bulls Power Limited - India
- Aditya Birla Group - India
- Marubeni Corporation - India
- The State Trading Corporation of India Ltd
- Commonwealth Bank - Australia
- Planning Commission, India
- Electricity Generating Authority of Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Neyveli Lignite Corporation Ltd, - India
- Meralco Power Generation, Philippines
- Semirara Mining Corp, Philippines
- Ministry of Finance - Indonesia
- Eastern Coal Council - USA
- Indian Oil Corporation Limited
- Petrochimia International Co. Ltd.- Taiwan
- Vedanta Resources Plc - India
- Edison Trading Spa - Italy
- Banpu Public Company Limited - Thailand
- Malabar Cements Ltd - India
- Mercator Lines Limited - India
- Thiess Contractors Indonesia
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- CNBM International Corporation - China
- Romanian Commodities Exchange
- Maharashtra Electricity Regulatory Commission - India
- Gujarat Sidhee Cement - India
- Bukit Asam (Persero) Tbk - Indonesia
- Sical Logistics Limited - India
- Kartika Selabumi Mining - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Maheswari Brothers Coal Limited - India
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- Cement Manufacturers Association - India
- Manunggal Multi Energi - Indonesia
- Siam City Cement PLC, Thailand
- Kumho Petrochemical, South Korea
- Minerals Council of Australia
- IEA Clean Coal Centre - UK
- Kohat Cement Company Ltd. - Pakistan
- Chamber of Mines of South Africa
- Renaissance Capital - South Africa
- Latin American Coal - Colombia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Aboitiz Power Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Transport, Egypt
- Pendopo Energi Batubara - Indonesia
- Australian Coal Association
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- CIMB Investment Bank - Malaysia
- Globalindo Alam Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Indo Tambangraya Megah - Indonesia
- Chettinad Cement Corporation Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indogreen Group - Indonesia
- Price Waterhouse Coopers - Russia
- Thai Mozambique Logistica
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Wood Mackenzie - Singapore
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Tamil Nadu electricity Board
- Metalloyd Limited - United Kingdom
- SMC Global Power, Philippines
- Georgia Ports Authority, United States
- GN Power Mariveles Coal Plant, Philippines
- Deloitte Consulting - India
- Rio Tinto Coal - Australia
- Independent Power Producers Association of India
- Sree Jayajothi Cements Limited - India
- Bangladesh Power Developement Board
- Straits Asia Resources Limited - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- OPG Power Generation Pvt Ltd - India
- Sojitz Corporation - Japan
- London Commodity Brokers - England
- Cigading International Bulk Terminal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Wilmar Investment Holdings
- Bhushan Steel Limited - India
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- GVK Power & Infra Limited - India
- Singapore Mercantile Exchange
- TeaM Sual Corporation - Philippines
- Ind-Barath Power Infra Limited - India
- Mercuria Energy - Indonesia
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
- Coastal Gujarat Power Limited - India
- Simpson Spence & Young - Indonesia
- Heidelberg Cement - Germany
- McConnell Dowell - Australia
- White Energy Company Limited
- Dalmia Cement Bharat India
- Tata Chemicals Ltd - India
- Sindya Power Generating Company Private Ltd
- Intertek Mineral Services - Indonesia
- Energy Development Corp, Philippines
- Orica Mining Services - Indonesia
- Binh Thuan Hamico - Vietnam
- The University of Queensland
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- Africa Commodities Group - South Africa
- Jaiprakash Power Ventures ltd
- GAC Shipping (India) Pvt Ltd
- Australian Commodity Traders Exchange
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- Energy Link Ltd, New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Trasteel International SA, Italy
- LBH Netherlands Bv - Netherlands
- Star Paper Mills Limited - India
- Global Business Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- San Jose City I Power Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Bulk Trading Sa - Switzerland
- Xindia Steels Limited - India
- Bhoruka Overseas - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- Bharathi Cement Corporation - India
- Mintek Dendrill Indonesia
- Oldendorff Carriers - Singapore
- Ceylon Electricity Board - Sri Lanka
- Makarim & Taira - Indonesia
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Iligan Light & Power Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Economic Council, Georgia
- Indika Energy - Indonesia
- Anglo American - United Kingdom
- Global Green Power PLC Corporation, Philippines
- Therma Luzon, Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Central Java Power - Indonesia
- IHS Mccloskey Coal Group - USA
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- Riau Bara Harum - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Medco Energi Mining Internasional
- Indonesian Coal Mining Association
- PowerSource Philippines DevCo
- Alfred C Toepfer International GmbH - Germany
- Mjunction Services Limited - India
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