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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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Tuesday, 09 September 14
PORT OF NEWCASTLE SHIPPED 13.207 MTN OF COAL IN AUGUST; TRADE VALUE AROUND $1.17 BILLION
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $1.17 billio ...
Monday, 08 September 14
SUB-BIT FOB INDONESIA COAL SWAP UNDERPERFORMED LAST WEEK
COALspot.com: Indonesian coal swaps for average October 2014 decreased US$ 0.20 (-0.39%) day on day and US$ 1.60 (-3.04%) per mt week on week. The ...
Monday, 08 September 14
API 8 CFR SOUTH CHINA COAL SWAP FOR DELIVERY JAN'15 CLOSED AT US$ 66.30 PMT W/E 5 SEPTEMBER 2014; LOST 5.15% M-O-M
COALspot.com: API 8 CFR South China Coal swap for delivery in October 2014 decreased US$ 0.15 (-0.23%) day on day and US$ 2.05 (-3.04%) week on wee ...
Monday, 08 September 14
CHINESE IRON ORE IMPORT DEMAND VERY STRONG - COMMODORE
COALspot.com: 30 dry bulk vessels were chartered in the spot iron ore market last week to haul iron ore import cargoes to Chinese buyers.
Acco ...
Sunday, 07 September 14
FREIGHT MARKET CONTINUED TO BE FIRM IN SPITE OF CAPE'S THIS WEEK'S WEAK PERFORMANCE
COALspot.com: BDI up by 0.7 pct week on week and closed at 1155 points this week. The Baltic Dry Index is a composite of three sub-indexes that mea ...
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- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PTC India Limited - India
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Agrawal Coal Company - India
- Toyota Tsusho Corporation, Japan
- Parry Sugars Refinery, India
- Posco Energy - South Korea
- Thiess Contractors Indonesia
- Holcim Trading Pte Ltd - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining and Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- Leighton Contractors Pty Ltd - Australia
- CNBM International Corporation - China
- Orica Australia Pty. Ltd.
- OPG Power Generation Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Merrill Lynch Commodities Europe
- Heidelberg Cement - Germany
- PetroVietnam Power Coal Import and Supply Company
- GMR Energy Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Interocean Group of Companies - India
- Binh Thuan Hamico - Vietnam
- Coalindo Energy - Indonesia
- Bangladesh Power Developement Board
- Indo Tambangraya Megah - Indonesia
- SMC Global Power, Philippines
- Sindya Power Generating Company Private Ltd
- Bukit Makmur.PT - Indonesia
- McConnell Dowell - Australia
- Wilmar Investment Holdings
- Jorong Barutama Greston.PT - Indonesia
- Standard Chartered Bank - UAE
- PowerSource Philippines DevCo
- Mintek Dendrill Indonesia
- Rio Tinto Coal - Australia
- Bhoruka Overseas - Indonesia
- Economic Council, Georgia
- GAC Shipping (India) Pvt Ltd
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Xindia Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Planning Commission, India
- Global Coal Blending Company Limited - Australia
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Development Corp, Philippines
- Parliament of New Zealand
- PNOC Exploration Corporation - Philippines
- Indika Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Billiton Holdings Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Malabar Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Mercator Lines Limited - India
- Global Green Power PLC Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- Ministry of Transport, Egypt
- Therma Luzon, Inc, Philippines
- Deloitte Consulting - India
- Australian Commodity Traders Exchange
- White Energy Company Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Anglo American - United Kingdom
- CIMB Investment Bank - Malaysia
- ICICI Bank Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- South Luzon Thermal Energy Corporation
- The State Trading Corporation of India Ltd
- Africa Commodities Group - South Africa
- Gujarat Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- Price Waterhouse Coopers - Russia
- Cigading International Bulk Terminal - Indonesia
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- India Bulls Power Limited - India
- Eastern Energy - Thailand
- Essar Steel Hazira Ltd - India
- Romanian Commodities Exchange
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- Riau Bara Harum - Indonesia
- Antam Resourcindo - Indonesia
- Timah Investasi Mineral - Indoneisa
- Dalmia Cement Bharat India
- Savvy Resources Ltd - HongKong
- Medco Energi Mining Internasional
- Cement Manufacturers Association - India
- Electricity Authority, New Zealand
- Directorate Of Revenue Intelligence - India
- Carbofer General Trading SA - India
- Gujarat Mineral Development Corp Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Kideco Jaya Agung - Indonesia
- London Commodity Brokers - England
- Bulk Trading Sa - Switzerland
- Sical Logistics Limited - India
- Meenaskhi Energy Private Limited - India
- Ind-Barath Power Infra Limited - India
- Videocon Industries ltd - India
- TeaM Sual Corporation - Philippines
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Minerals Council of Australia
- Kalimantan Lumbung Energi - Indonesia
- Formosa Plastics Group - Taiwan
- Siam City Cement PLC, Thailand
- Kartika Selabumi Mining - Indonesia
- Aditya Birla Group - India
- Sakthi Sugars Limited - India
- Vizag Seaport Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- Latin American Coal - Colombia
- Miang Besar Coal Terminal - Indonesia
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- Altura Mining Limited, Indonesia
- Indonesian Coal Mining Association
- Vijayanagar Sugar Pvt Ltd - India
- Central Java Power - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Kumho Petrochemical, South Korea
- Ministry of Finance - Indonesia
- Vedanta Resources Plc - India
- VISA Power Limited - India
- SMG Consultants - Indonesia
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- LBH Netherlands Bv - Netherlands
- Indogreen Group - Indonesia
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Rashtriya Ispat Nigam Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Salva Resources Pvt Ltd - India
- Orica Mining Services - Indonesia
- Gujarat Sidhee Cement - India
- Global Business Power Corporation, Philippines
- Edison Trading Spa - Italy
- Barasentosa Lestari - Indonesia
- Star Paper Mills Limited - India
- GVK Power & Infra Limited - India
- Bhushan Steel Limited - India
- Central Electricity Authority - India
- San Jose City I Power Corp, Philippines
- Karaikal Port Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Jaiprakash Power Ventures ltd
- Siam City Cement - Thailand
- Iligan Light & Power Inc, Philippines
- Trasteel International SA, Italy
- Oldendorff Carriers - Singapore
- Chettinad Cement Corporation Ltd - India
- ASAPP Information Group - India
- Thai Mozambique Logistica
- Australian Coal Association
- Grasim Industreis Ltd - India
- MS Steel International - UAE
- Lanco Infratech Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Uttam Galva Steels Limited - India
- Attock Cement Pakistan Limited
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bayan Resources Tbk. - Indonesia
- Intertek Mineral Services - Indonesia
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- The Treasury - Australian Government
- Maheswari Brothers Coal Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- International Coal Ventures Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Wood Mackenzie - Singapore
- Tamil Nadu electricity Board
- Baramulti Group, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Krishnapatnam Port Company Ltd. - India
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Kaltim Prima Coal - Indonesia
- Marubeni Corporation - India
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- Simpson Spence & Young - Indonesia
- Tata Chemicals Ltd - India
- IHS Mccloskey Coal Group - USA
- Semirara Mining Corp, Philippines
- Bhatia International Limited - India
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
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