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Wednesday, 09 July 14
SHIPPING MARKET INSIGHT - PANOS TSILINGIRIS
 The mini-boom in dry bulker values catapulted ship prices too fast too far over the last one-and-a-half year. The concurrence of historically low prices in both second-hand and newbuilding markets, which approached the post Asian crisis lows in inflation-adjusted terms, offered the perfect background for asset play, but this is much easier said than done.
Most real-world buy-low-sell-higher cases concentrated on the flipping of newbuildings contracted at rock-bottom prices when we witnessed Handysize Newbuildings at sub-20musd levels, Ultramaxes at sub-24musd, Kamsarmaxes at rgn 26musd, and Capes at low-mid 40s. Notably, Cargill penned in May 2013 3x180kdwt Capes at SWS, acknowledging they would not operate these ships forever, and by the end of the same year sold them to Scorpio at 57musd each at a stunning rgn10musd profit per vessel. Oldendorff purchased a Crown-63 resale in late 2012 for mid-24s and after trading her, sold her for rgn31musd to Greeks. The same interests recently sold to Diana, a 180k Capesize resale under construction at Qingdao Beihai, for 58musd and a profit in excess of 10musd.
S&P-wise, the appreciation was spectacular on all dry asset classes last year. Regarding LME Panamaxes, ex-Ocean Planet (‘05 Sasebo) was committed in January 2013 by Chartworld at sub-m$15 while ex-Ocean Lily (’06 Imabari) was sold to Sanko close to 25musd this March, resulting in a 2/3 value appreciation in 14mos. While initial appreciation was substantiated, it went on irrationally (mimicry, artificial liquidity by the speculative funds, fear of ‘losing’ the market or even having money in the bank, taxation considerations, low interest rates, etc). On a few S&P asset play cases, in late 2012 Norwegian interests committed the 2006-built Tsuneishi Kamsarmax ex ‘Mizunagi Maru’ arnd 18.4musd and sold her a year later at 23.5musd to Greek interests enjoying a 5musd profit. Chinese owners also got on the bandwagon, having sold two late 90s Capes (m/v Lian Fu Star and m/v Tai Fu Star) to Ukrainians at mid/high teens recording a profit of rgn/xs 5musd per vessel in less than a year.
The current price correction is evidenced by the sale of the ‘Yusho Spica’ at rgn 20musd marked an abrupt 5musd discount from her same-year built sister ‘Ocean Lily’ 3 months ago. This brings asset values back to May 2013 when the ex-Shoyo (76k ’06 Namura) was sold at 20.25musd to Diana. Most likely, the current correction will not break soon the previous lows, because the costs of creating a new asset, ie, newbuilding prices, are well above previous lows and there are still many buyers/funds getting ready to step in, should a further correction in asset values occurs.
Well-timed acquisitions materialize when the others are fearful, when the banks do not lend money, when speculative money becomes disappointed. Nobody knows where we are heading but the recent past has benchmarked a lower bound for assets. As such, there may be longer-term value in modern S&P deals priced up to a 20% premium above the rock-bottom (e.g. a 2006/7 Japanese built Panamax BC at 18musd) and at a respective 10% premium for newbuildings (e.g., rgn/sub 29-30musd for Kamsa NBs from top Chinese yards). We may be getting close to there, but there are strong resistance forces as well.
Perhaps the wildest scenario would arise if the freight market stays depressed for another year and asset prices deteriorate further. What would then be the reaction of the speculative funds that, having a short-term investment horizon anyway, may massively look for an exit? In case this happens, it may signal the biggest asset play opportunity in the coming years.
By Panos Tsilingiris - SnP Broker
Analysts:
Mr. George Lazaridis
Ms. Eva Tzima
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no re-producing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Wednesday, 25 June 14
INDONESIAN COAL EXPORTS ON RISE; EARNINGS FALL ON LOWER SELLING PRICES
COALspot.com: Indonesia, one of the world's largest coal producer and the global largest multi grade coal exporter shipped around $1.84* ...
Wednesday, 25 June 14
THE PANAMAX MARKET REACHED FRESH LOWS FOR THE YEAR, SAYS INTERMODAL
COALspot.com: The Dry Bulk market closed off the week noting a slight decrease, but this image of stability is merely representative of freight rat ...
Wednesday, 25 June 14
SHIPPING: MARKET INSIGHT - YANNIS OLZIERSKY
During his recent visit in London, China's Premier, Li Keqiang, announced that China's economy, the world's second largest after the US ...
Tuesday, 24 June 14
INDONESIAN COAL MINER TARGETS RP 313 BILLION IPO
COALspot.com: Indonesian coal miner PT Mitrabara Adiperdana is aiming to raise up to Rp 313 billion to Rp 368 billion (approximately $26.133 millio ...
Monday, 23 June 14
INDONESIAN COAL SWAP FOR Q3 DELIVERY LOST 8.60% Y-O-Y;4.80% M-O-M
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on day, week and on month according to AsiaClear OTC coal swap's reports re ...
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- Power Finance Corporation Ltd., India
- Central Electricity Authority - India
- TeaM Sual Corporation - Philippines
- Minerals Council of Australia
- Siam City Cement PLC, Thailand
- Sinarmas Energy and Mining - Indonesia
- Global Coal Blending Company Limited - Australia
- MS Steel International - UAE
- Mintek Dendrill Indonesia
- Alfred C Toepfer International GmbH - Germany
- Trasteel International SA, Italy
- Deloitte Consulting - India
- VISA Power Limited - India
- LBH Netherlands Bv - Netherlands
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Siam City Cement - Thailand
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Gujarat Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Renaissance Capital - South Africa
- Kobexindo Tractors - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- GVK Power & Infra Limited - India
- Aboitiz Power Corporation - Philippines
- Madhucon Powers Ltd - India
- Central Java Power - Indonesia
- Bhushan Steel Limited - India
- Vizag Seaport Private Limited - India
- IEA Clean Coal Centre - UK
- Semirara Mining Corp, Philippines
- Bhoruka Overseas - Indonesia
- Attock Cement Pakistan Limited
- Larsen & Toubro Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- Ministry of Transport, Egypt
- ICICI Bank Limited - India
- Krishnapatnam Port Company Ltd. - India
- London Commodity Brokers - England
- Electricity Authority, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Chamber of Mines of South Africa
- Maharashtra Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Banpu Public Company Limited - Thailand
- Coal and Oil Company - UAE
- Thiess Contractors Indonesia
- The State Trading Corporation of India Ltd
- CNBM International Corporation - China
- Chettinad Cement Corporation Ltd - India
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- Vijayanagar Sugar Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Oldendorff Carriers - Singapore
- Iligan Light & Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Barasentosa Lestari - Indonesia
- Port Waratah Coal Services - Australia
- Kalimantan Lumbung Energi - Indonesia
- Altura Mining Limited, Indonesia
- Videocon Industries ltd - India
- Latin American Coal - Colombia
- Sical Logistics Limited - India
- Ministry of Mines - Canada
- IHS Mccloskey Coal Group - USA
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- AsiaOL BioFuels Corp., Philippines
- Antam Resourcindo - Indonesia
- Goldman Sachs - Singapore
- PowerSource Philippines DevCo
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Kideco Jaya Agung - Indonesia
- McConnell Dowell - Australia
- Tata Chemicals Ltd - India
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- Kapuas Tunggal Persada - Indonesia
- Intertek Mineral Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Bukit Baiduri Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Kaltim Prima Coal - Indonesia
- Aditya Birla Group - India
- Cement Manufacturers Association - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Anglo American - United Kingdom
- Petron Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Carbofer General Trading SA - India
- Gujarat Mineral Development Corp Ltd - India
- Metalloyd Limited - United Kingdom
- Parliament of New Zealand
- SMC Global Power, Philippines
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- OPG Power Generation Pvt Ltd - India
- GMR Energy Limited - India
- Mercuria Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Marubeni Corporation - India
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vedanta Resources Plc - India
- Price Waterhouse Coopers - Russia
- Bukit Makmur.PT - Indonesia
- Bhatia International Limited - India
- Meralco Power Generation, Philippines
- Coalindo Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- South Luzon Thermal Energy Corporation
- Commonwealth Bank - Australia
- Medco Energi Mining Internasional
- Baramulti Group, Indonesia
- Georgia Ports Authority, United States
- European Bulk Services B.V. - Netherlands
- Toyota Tsusho Corporation, Japan
- Jaiprakash Power Ventures ltd
- Electricity Generating Authority of Thailand
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Rio Tinto Coal - Australia
- Billiton Holdings Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Mercator Lines Limited - India
- Leighton Contractors Pty Ltd - Australia
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- PNOC Exploration Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Agrawal Coal Company - India
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- Merrill Lynch Commodities Europe
- Jindal Steel & Power Ltd - India
- Ceylon Electricity Board - Sri Lanka
- White Energy Company Limited
- Singapore Mercantile Exchange
- Dalmia Cement Bharat India
- Australian Coal Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- Karaikal Port Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Malabar Cements Ltd - India
- Bulk Trading Sa - Switzerland
- India Bulls Power Limited - India
- Thai Mozambique Logistica
- Therma Luzon, Inc, Philippines
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- Indian Oil Corporation Limited
- Ministry of Finance - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Uttam Galva Steels Limited - India
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- New Zealand Coal & Carbon
- Kepco SPC Power Corporation, Philippines
- Parry Sugars Refinery, India
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- PTC India Limited - India
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- Indian Energy Exchange, India
- Energy Link Ltd, New Zealand
- Bayan Resources Tbk. - Indonesia
- Eastern Coal Council - USA
- International Coal Ventures Pvt Ltd - India
- Planning Commission, India
- Orica Australia Pty. Ltd.
- Energy Development Corp, Philippines
- Bharathi Cement Corporation - India
- Orica Mining Services - Indonesia
- Sakthi Sugars Limited - India
- Eastern Energy - Thailand
- Tamil Nadu electricity Board
- Edison Trading Spa - Italy
- Globalindo Alam Lestari - Indonesia
- Wilmar Investment Holdings
- Bangladesh Power Developement Board
- Manunggal Multi Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Grasim Industreis Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Indogreen Group - Indonesia
- Indika Energy - Indonesia
- Kumho Petrochemical, South Korea
- Sarangani Energy Corporation, Philippines
- Wood Mackenzie - Singapore
- Standard Chartered Bank - UAE
- Pendopo Energi Batubara - Indonesia
- Meenaskhi Energy Private Limited - India
- Global Business Power Corporation, Philippines
- Economic Council, Georgia
- Miang Besar Coal Terminal - Indonesia
- Formosa Plastics Group - Taiwan
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