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Wednesday, 15 October 14
DRY BULK SHIPPING: RATE IMPROVEMENTS ARRIVED AS FORECAST, BUT UNCERTAINTY MOUNTS FOR 2015 DEMAND - BIMCO
 BIMCO released its latest short term assessment of the dry bulk market, estimating that over the October-November period, the level of Capesize TC average rates will rise from the current level below the USD 10,000 per day mark. Once the belated, but still anticipated, rush of Brazilian iron ore spot cargoes enter the market, freight rates should be volatile around USD 8,000-23,000 per day. Panamax TC average rates will remain around USD 5,000-10,000 per day. For the Supramax segment, BIMCO forecasts freight rates in the USD 8,500-13,500 per day range, whereas Handysize freight rates are expected around USD 6,500-9,500 per day.
According to the report, “while we await the long-anticipated rebound in Capesize freight rates centred on Brazilian exports, let’s focus on the brighter spots elsewhere in dry bulk shipping. Panamax freight rates are dragging along, as the oversupply is still clearly felt in the freight market. Fortunately, the erratic movements have now been mostly upward since the bottom-out on 27 June at USD 3,362 per day. Since then, freight rates have more than doubled to USD 7,101 per day, but this is still very different from delivering healthy earnings to owners and operators as the present ones are barely covering OPEX.
Supramaxes and Handysizes live a less volatile life than their larger peers do, and the rebound is clearly felt and seen, moving from the lower end of BIMCO’s forecast freight rate interval to the top for Handysizes, with Supramaxes still firming to close the gap completely.
Freight rates for all four segments have performed as forecast in our last report; a positive development without fireworks. The only disappointment was the fact that Capesize freight rates only reached USD 17,670 per day on 10 September and have since then slid down to USD 11,000 per day”.
BIMCO’s Chief Shipping Analyst, Mr. Peter Sand added that “the development in the sub-Capesize ship sizes mirrors very well what we have experienced in terms of demand. The weak development of coal cargoes into China has given some softness to the Panamax market, with Indian imports failing to make up for all the lost demand. In the meantime, the Supras and Handies have both benefitted from the strong demand for minor bulks. On top of that, we have surging Indian coal imports up by 19% year-onyear to 16 million tonnes in September, as busy power companies went on a buying spree at low international prices. The grain export season is also up and running now across the northern hemisphere. Even the exports of wheat and barley from Ukraine have contributed positively to the market, despite the difficult situation Ukraine is facing due to the stand-off with Russia. Russia’s exports of the same commodities are also very high and projected to hit record levels this year as the season progresses. Russian exports in August were at a record high of 4.2 MT according to USDA, as seasonality spikes exports. In Ukraine, exports are strong too at 3.3 MT in both August and September, according to BIMCO data.
SUPPLY
In terms of supply, BIMCO noted that “the dry bulk carrier fleet has grown by 3.6% in the first nine months of the year – 37.8 million DWT (486 units) have been delivered, offset by 11.5 million DWT (213 units) being demolished. One-third of the total added capacity came in the form of 66 Capesizes and 1 Valemax. In addition to that, 144 Panamaxes, 150 Supra-/Handymax and 125 Handysizes entered the active fleet. BIMCO forecast the total level of newbuilt deliveries for 2014 to reach 55 million DWT, with the current forecast for 2015 heading for a slightly lower level than that. Since our last report, the order book for 2016 has built up to reach 60 million DWT. With demolition expected to remain somewhat unchanged, this will again increase the pressure on the fundamental supply-demand balance as the fleet could expand by almost 6% again, up from 5.2% projected for 2015. Fortunately, the newbuilding contracting activity has been more subdued in 2014 as compared to the rush of 2013, where 102 million DWT of new orders were placed. At the beginning of October 2014, the year-to-date contracting volumes stood at exactly half that of the full year 2013. 2014 is therefore heading for a significant slowdown from 2013, but still a level that does not support an improved market balance going forward unless it is combined with a strong demolition activity, which BIMCO does not expect to happen”.
Outlook
Meanwhile, “the poor state of the freight market has naturally also affected asset values in a negative way. At the beginning of October 2014, Capesize ships made most of the gains from the early parts of the year, while the three smaller segments are in the red by 7% to 20% – the older the ship the bigger the lost value as assessed by Vesselvalue.com. Uncertainty mounts around the future imports of coal into India. This follows the ruling by India’s Supreme Court to deem illegal 214 out of 218 coal-block licences allocated to various companies from 1994-2010, of which 42 are being worked. Following a six month grace period given prior to the closing of the mines, only four could potentially continue operations. Should this become reality, significant seaborne imports will follow once the stockpiles have been run down. Nevertheless, it is too early to know if only four mines will continue to operate beyond 24 March 2015. Imports are likely to come from South Africa, as India favours the higher quality to the higher ash content (23%) coal imports from Australia, which is seeking new buyers, with China potentially shying away from imports of thermal coal with an ash content higher than 16% from 1 January 2015″.
According to the report, “these are two wild cards for the seaborne coal trade next year if implemented as described. The oversupply of iron ore into the market has dragged prices to the floor. In September 2014, iron ore prices reached a five-year low for 62% Fe content delivered at Qingdao, China, as it went below USD 80 per tonnes. This low level does not reflect poor demand conditions for iron ore or lower steel production in China, which is up by 5% in the first eight months of 2014. However, the lower iron ore prices may push forward a higher Chinese import level, as domestic production can be squeezed out because of higher production costs, as well as lower commodity prices tending to spur increased seaborne demand”, BIMCO concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Monday, 06 October 14
' COAL-BY-WIRE' FROM SUMATRA TO JAVA - THE JAKARTA POST
Coal from the island of Sumatra accounts for most of Indonesia’s low-grade lignite, a low-quality coal that receives a poor price in internat ...
Monday, 06 October 14
THE IRON ORE SHIPPING BUSINESS IS FACING SOME ROUGH SEAS - EAST ASIA FORUM
The impact of Chinese demand on global iron ore prices is well known. A less acknowledged consequence of China’s emergence is the transformat ...
Sunday, 05 October 14
BALTIC DRY INDEX SLIPS 1.14%; BALTIC PANAMAX INDEX GAINED 9.91% WEEK ON WEEK
COALspot.com: The BDI was down by 1.14 pct and closed at 1037 points this Friday.
The Cape index was down significantly week on week or lost 5 ...
Friday, 03 October 14
U.S. WEEKLY COAL PRODUCTION UP 5.8% TO 19.9 MMST
COALspot.com – United States the world's one of largest coal producers, produced approximately 19.9 million short tons (mmst) of co ...
Thursday, 02 October 14
CAPESIZE - DULL AND WITHOUT MUCH DIRECTION AS IRON ORE AND COAL VOLUMES FAIL TO LIVE UP EXPECTATIONS
Handy
After the recent weeks´ rate increase in the Atlantic we see Panamaxes snapping up handymax and Supra cargoes at much lower levels, p ...
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- Star Paper Mills Limited - India
- Larsen & Toubro Limited - India
- Gujarat Sidhee Cement - India
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- Bhatia International Limited - India
- Directorate Of Revenue Intelligence - India
- Asmin Koalindo Tuhup - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMC Global Power, Philippines
- Sree Jayajothi Cements Limited - India
- Semirara Mining Corp, Philippines
- Formosa Plastics Group - Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PNOC Exploration Corporation - Philippines
- Tata Chemicals Ltd - India
- Aditya Birla Group - India
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- Heidelberg Cement - Germany
- Dalmia Cement Bharat India
- Chamber of Mines of South Africa
- Merrill Lynch Commodities Europe
- Indian Oil Corporation Limited
- Madhucon Powers Ltd - India
- Oldendorff Carriers - Singapore
- Marubeni Corporation - India
- Timah Investasi Mineral - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Energy Development Corp, Philippines
- IHS Mccloskey Coal Group - USA
- McConnell Dowell - Australia
- Bulk Trading Sa - Switzerland
- European Bulk Services B.V. - Netherlands
- Barasentosa Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Anglo American - United Kingdom
- Global Coal Blending Company Limited - Australia
- Miang Besar Coal Terminal - Indonesia
- LBH Netherlands Bv - Netherlands
- Latin American Coal - Colombia
- Sinarmas Energy and Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- London Commodity Brokers - England
- Central Electricity Authority - India
- Kideco Jaya Agung - Indonesia
- Bharathi Cement Corporation - India
- Altura Mining Limited, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Edison Trading Spa - Italy
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Krishnapatnam Port Company Ltd. - India
- Semirara Mining and Power Corporation, Philippines
- Indonesian Coal Mining Association
- IEA Clean Coal Centre - UK
- Interocean Group of Companies - India
- Rio Tinto Coal - Australia
- White Energy Company Limited
- GVK Power & Infra Limited - India
- Rashtriya Ispat Nigam Limited - India
- Mintek Dendrill Indonesia
- South Luzon Thermal Energy Corporation
- Siam City Cement - Thailand
- Wood Mackenzie - Singapore
- Indo Tambangraya Megah - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Energy Exchange, India
- Kartika Selabumi Mining - Indonesia
- San Jose City I Power Corp, Philippines
- Singapore Mercantile Exchange
- Makarim & Taira - Indonesia
- India Bulls Power Limited - India
- Bhoruka Overseas - Indonesia
- Baramulti Group, Indonesia
- Port Waratah Coal Services - Australia
- OPG Power Generation Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Carbofer General Trading SA - India
- Minerals Council of Australia
- Africa Commodities Group - South Africa
- Cement Manufacturers Association - India
- Gujarat Electricity Regulatory Commission - India
- Gujarat Mineral Development Corp Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Global Business Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- SMG Consultants - Indonesia
- Eastern Coal Council - USA
- Maharashtra Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Banpu Public Company Limited - Thailand
- Manunggal Multi Energi - Indonesia
- Ministry of Finance - Indonesia
- Bukit Baiduri Energy - Indonesia
- Indika Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- Karaikal Port Pvt Ltd - India
- Ministry of Transport, Egypt
- Kapuas Tunggal Persada - Indonesia
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Kumho Petrochemical, South Korea
- Alfred C Toepfer International GmbH - Germany
- Energy Link Ltd, New Zealand
- Videocon Industries ltd - India
- Sical Logistics Limited - India
- Meralco Power Generation, Philippines
- Romanian Commodities Exchange
- Agrawal Coal Company - India
- Attock Cement Pakistan Limited
- PTC India Limited - India
- Indogreen Group - Indonesia
- Intertek Mineral Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- The University of Queensland
- ICICI Bank Limited - India
- Lanco Infratech Ltd - India
- Posco Energy - South Korea
- Goldman Sachs - Singapore
- ASAPP Information Group - India
- TNB Fuel Sdn Bhd - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Coalindo Energy - Indonesia
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- CIMB Investment Bank - Malaysia
- Sojitz Corporation - Japan
- Samtan Co., Ltd - South Korea
- Deloitte Consulting - India
- Savvy Resources Ltd - HongKong
- Antam Resourcindo - Indonesia
- Meenaskhi Energy Private Limited - India
- New Zealand Coal & Carbon
- Kaltim Prima Coal - Indonesia
- Tamil Nadu electricity Board
- Bangladesh Power Developement Board
- Thiess Contractors Indonesia
- Globalindo Alam Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Aboitiz Power Corporation - Philippines
- Medco Energi Mining Internasional
- TeaM Sual Corporation - Philippines
- Planning Commission, India
- Directorate General of MIneral and Coal - Indonesia
- Trasteel International SA, Italy
- Ambuja Cements Ltd - India
- Sakthi Sugars Limited - India
- Bhushan Steel Limited - India
- Ind-Barath Power Infra Limited - India
- Renaissance Capital - South Africa
- The State Trading Corporation of India Ltd
- Kobexindo Tractors - Indoneisa
- Essar Steel Hazira Ltd - India
- Parry Sugars Refinery, India
- International Coal Ventures Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Simpson Spence & Young - Indonesia
- Electricity Authority, New Zealand
- Parliament of New Zealand
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PowerSource Philippines DevCo
- Central Java Power - Indonesia
- Electricity Generating Authority of Thailand
- Economic Council, Georgia
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Mercator Lines Limited - India
- Xindia Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Australian Coal Association
- Iligan Light & Power Inc, Philippines
- CNBM International Corporation - China
- Power Finance Corporation Ltd., India
- GMR Energy Limited - India
- Petron Corporation, Philippines
- Riau Bara Harum - Indonesia
- GAC Shipping (India) Pvt Ltd
- Billiton Holdings Pty Ltd - Australia
- Ministry of Mines - Canada
- Sarangani Energy Corporation, Philippines
- VISA Power Limited - India
- Borneo Indobara - Indonesia
- Thai Mozambique Logistica
- Leighton Contractors Pty Ltd - Australia
- Karbindo Abesyapradhi - Indoneisa
- Independent Power Producers Association of India
- Mjunction Services Limited - India
- Pendopo Energi Batubara - Indonesia
- Sindya Power Generating Company Private Ltd
- Wilmar Investment Holdings
- Coastal Gujarat Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- PetroVietnam Power Coal Import and Supply Company
- Kepco SPC Power Corporation, Philippines
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