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Monday, 24 November 14
CHOPPY WATERS IN DRY BULK - SGX
 COALspot.com: Dry bulk freight rates have experienced a sharp rise in volatility in recent weeks as bulk commodity supply has ramped up, said SGX in its latest note.
SGX, Singapore Exchange represents the premier access point for managing Asian capital and investment exposure, and is Asia’s most international exchange with more than 40% of companies listed on SGX originating outside of Singapore.
SGX further said, the 30-day annualised volatility of the Baltic Dry Index has surpassed 50%, versus a Q3 average of 37%. This spike in volatility has been primarily driven by Capesize rates, with the Baltic Capesize Index 30-day annualised volatility averaging a staggering 138% so far this month.
According to SGX, year-to-date, the benchmark iron ore price has fallen 48% while thermal coal prices have also steadily declined through the course of the year. Freight rates meanwhile have been extremely volatile, but on average holding well at higher levels. As a result, freight rates have become a much more significant component of delivered iron ore and coal prices.
"In January 2014 for example, the C5 route (Western Australia to China) averaged less than 7% of the benchmark delivered iron ore price into China. At present, the same route makes up more than 13% of the delivered iron ore price. Falling bulk commodity prices have led freight to become a relatively more important consideration along the commodity value chain, and with volatility spiking, effective freight risk management tools have become all the more important," said SGX.
The dry bulk freight market is often subject to severe seasonality, with typically stronger demand through Q4. Iron ore, coal and steel account for about 60% of total dry bulk tonne-miles, according to Clarksons. Seasonality within the seaborne iron ore and thermal coal markets therefore has a significant impact on the dry bulk freight market, as noted by SGX.
SGX further said, Iron ore usually sees strong seaborne trade volumes during Q4 as producers look to maximise exports ahead of seasonal weather-related supply disruptions that often occur in Q1, while the Chinese steel industry typically restocks steelmaking raw materials ahead of the cold winter months/Chinese New Year. Over the past three years, Brazilian and Australian iron ore shipments have on average risen in Q4 (versus Q3) by 9% and 6%, respectively. Thermal coal also usually experiences higher seaborne volumes towards year-end in anticipation of winter as power supply companies look to build inventory. In the past three years, Indonesian and Australian thermal coal exports have on average risen by 17% and 5% respectively in Q4.
With relatively inelastic supply in the dry bulk freight market, these seasonal demand fluctuations can lead to heightened price volatility, and in past years freight rates have often risen in Q4. Indeed, recent prices rises in Capesize and Panamax rates are indicative of such seasonality. That said, uncertainty remains over whether we will see typical seasonal impacts sustained over the coming months. Reasons for such uncertainty and potentially unseasonal trends may include: (i) tight credit availability and ample iron ore port inventory in China, which may limit the degree of seasonal restocking; (ii) Chinese coal imports are declining, and government regulations appear supportive of this trend; and (iii) meteorologists are suggesting a high probability of an El Nino event this year, which may mean drier than usual weather in Australia and Indonesia, and potentially therefore lower than normal weather-related supply disruptions, concluded SGX.
According to SGX, it is managing both commodity & freight on one platform; capital efficiencies through margin optimisation
SGX uniquely provides effective risk management tools to manage both the underlying bulk commodity and freight rate exposures together on the same platform. Furthermore, with all products on one platform SGX is able to offer highly competitive intra-commodity margin offsets. With a range of margin credits across different freight products as well as intra-commodity margin offsets between freight and iron ore, SGX provides a unique value proposition for the clearing of freight and bulk commodity derivatives.
For more details about SGX please click here to visit its official website.
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Friday, 10 October 14
U.S. PRODUCED 83.2 MMST OF COAL IN SEPTEMBER, SAYS EIA
COALspot.com – United States the world's one of largest coal producers, produced approximately 18.6 million short tons (mmst) of coal in ...
Thursday, 09 October 14
CAPESIZE MARKET HAS CONTINUED TO SHOW WEAKNESS - FEARNLEYS
Handy
We mentioned last week that after several weeks of rate increase for the Supras, the bigger Panamaxes started to snap up better paying Supr ...
Thursday, 09 October 14
SHIPPING REMAINS CHALLENGED AS GLOBAL GROWTH DISAPPOINTS - BIMCO
The global shipping industry finds no grace from much stronger economic activity going forward, as the global recovery remains fragile and uneven. ...
Wednesday, 08 October 14
CAPES RATE FOR THE W. AUSTRALIA TO CHINA VOYAGE MOVED TO BELOW $8/MT - INTERMODAL
The Dry Bulk market remained under pressure last week, with rates for Capes remaining on the red while those for Panamaxes managed to outperform th ...
Wednesday, 08 October 14
OIL COULD FALL TO USD80 BEFORE SHALE SUPPLY RESPONSE - FITCH
COALspot.com: Brent oil could fall as low as USD80 a barrel before triggering a self-correcting supply response with shale-oil drillers cutting inv ...
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- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- Minerals Council of Australia
- Marubeni Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Bulk Trading Sa - Switzerland
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- PNOC Exploration Corporation - Philippines
- White Energy Company Limited
- Kumho Petrochemical, South Korea
- Parry Sugars Refinery, India
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Global Green Power PLC Corporation, Philippines
- Savvy Resources Ltd - HongKong
- The Treasury - Australian Government
- Attock Cement Pakistan Limited
- San Jose City I Power Corp, Philippines
- Ministry of Mines - Canada
- Central Java Power - Indonesia
- Altura Mining Limited, Indonesia
- Barasentosa Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indika Energy - Indonesia
- Videocon Industries ltd - India
- Indogreen Group - Indonesia
- Meenaskhi Energy Private Limited - India
- Metalloyd Limited - United Kingdom
- ICICI Bank Limited - India
- Mercuria Energy - Indonesia
- Gujarat Sidhee Cement - India
- Neyveli Lignite Corporation Ltd, - India
- Maharashtra Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Formosa Plastics Group - Taiwan
- Thiess Contractors Indonesia
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Planning Commission, India
- Bhatia International Limited - India
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Alfred C Toepfer International GmbH - Germany
- Kohat Cement Company Ltd. - Pakistan
- International Coal Ventures Pvt Ltd - India
- Aditya Birla Group - India
- Aboitiz Power Corporation - Philippines
- Meralco Power Generation, Philippines
- Independent Power Producers Association of India
- India Bulls Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Semirara Mining Corp, Philippines
- Uttam Galva Steels Limited - India
- Orica Mining Services - Indonesia
- Standard Chartered Bank - UAE
- Wilmar Investment Holdings
- Parliament of New Zealand
- Krishnapatnam Port Company Ltd. - India
- Commonwealth Bank - Australia
- Xindia Steels Limited - India
- SMG Consultants - Indonesia
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Samtan Co., Ltd - South Korea
- Ministry of Finance - Indonesia
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- Eastern Coal Council - USA
- Kobexindo Tractors - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Merrill Lynch Commodities Europe
- Port Waratah Coal Services - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Mjunction Services Limited - India
- Sinarmas Energy and Mining - Indonesia
- Interocean Group of Companies - India
- Trasteel International SA, Italy
- IHS Mccloskey Coal Group - USA
- Tata Chemicals Ltd - India
- Georgia Ports Authority, United States
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- Global Business Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Coal and Oil Company - UAE
- Posco Energy - South Korea
- Rio Tinto Coal - Australia
- Bukit Baiduri Energy - Indonesia
- The State Trading Corporation of India Ltd
- Petron Corporation, Philippines
- Agrawal Coal Company - India
- Antam Resourcindo - Indonesia
- GVK Power & Infra Limited - India
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Riau Bara Harum - Indonesia
- Cement Manufacturers Association - India
- Toyota Tsusho Corporation, Japan
- McConnell Dowell - Australia
- The University of Queensland
- Sakthi Sugars Limited - India
- Oldendorff Carriers - Singapore
- CIMB Investment Bank - Malaysia
- Mintek Dendrill Indonesia
- Kideco Jaya Agung - Indonesia
- Intertek Mineral Services - Indonesia
- Grasim Industreis Ltd - India
- Ambuja Cements Ltd - India
- Goldman Sachs - Singapore
- Sindya Power Generating Company Private Ltd
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Lanco Infratech Ltd - India
- Binh Thuan Hamico - Vietnam
- Australian Coal Association
- Energy Link Ltd, New Zealand
- LBH Netherlands Bv - Netherlands
- CNBM International Corporation - China
- Indian Energy Exchange, India
- Directorate Of Revenue Intelligence - India
- Manunggal Multi Energi - Indonesia
- Eastern Energy - Thailand
- Medco Energi Mining Internasional
- Vedanta Resources Plc - India
- SMC Global Power, Philippines
- GMR Energy Limited - India
- Energy Development Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Power Finance Corporation Ltd., India
- Ceylon Electricity Board - Sri Lanka
- Makarim & Taira - Indonesia
- Jaiprakash Power Ventures ltd
- GN Power Mariveles Coal Plant, Philippines
- Globalindo Alam Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- New Zealand Coal & Carbon
- GAC Shipping (India) Pvt Ltd
- Siam City Cement - Thailand
- Thai Mozambique Logistica
- OPG Power Generation Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Ind-Barath Power Infra Limited - India
- Wood Mackenzie - Singapore
- Latin American Coal - Colombia
- Timah Investasi Mineral - Indoneisa
- Anglo American - United Kingdom
- Electricity Generating Authority of Thailand
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- Bukit Makmur.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- MS Steel International - UAE
- Indonesian Coal Mining Association
- Semirara Mining and Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Madhucon Powers Ltd - India
- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Central Electricity Authority - India
- Jorong Barutama Greston.PT - Indonesia
- Mercator Lines Limited - India
- Coalindo Energy - Indonesia
- Economic Council, Georgia
- Sical Logistics Limited - India
- Dalmia Cement Bharat India
- Petrochimia International Co. Ltd.- Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Essar Steel Hazira Ltd - India
- VISA Power Limited - India
- IEA Clean Coal Centre - UK
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- PowerSource Philippines DevCo
- AsiaOL BioFuels Corp., Philippines
- Asmin Koalindo Tuhup - Indonesia
- Sojitz Corporation - Japan
- Kepco SPC Power Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- Carbofer General Trading SA - India
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- Chamber of Mines of South Africa
- London Commodity Brokers - England
- Orica Australia Pty. Ltd.
- Sree Jayajothi Cements Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- Star Paper Mills Limited - India
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Simpson Spence & Young - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Global Coal Blending Company Limited - Australia
- Edison Trading Spa - Italy
- Bangladesh Power Developement Board
- Indian Oil Corporation Limited
- South Luzon Thermal Energy Corporation
- Renaissance Capital - South Africa
- Rashtriya Ispat Nigam Limited - India
- Ministry of Transport, Egypt
- Electricity Authority, New Zealand
- TeaM Sual Corporation - Philippines
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