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Wednesday, 24 December 14
MARKET INSIGHT - JOHN N. COTZIAS, INTERMODAL SNP BROKER
 The year is coming to an end, and we should be able to assess if this was a good year, a bad year, or even a lousy one? The answer clearly depends on where you stand… which was your bet-horse in other words.
The negative sentiment that has been prevailing in the dry bulk market lately leaves most owners with a rather bitter taste following the free fall of the past weeks. Enquiry levels remain low and we observe with great concern the everyday softening that takes place in the Capesize segment, with the BCI touching new historical lows daily, since its introduction in March 1999. In the past four weeks we have seen the index dropping from above 3,000 points to well below 500 points, while the average T/C for the segment has moved from $23,000/day to below $4,900/day. What a drop! If one considers that most Capes run their OPEX in excess of $10k/day and the level of CAPEX for those Capes acquired at 100mil USD then it goes without saying that some owners and their banks are facing hard times ahead. The drop in second-hand prices is also evident, with prices approaching the levels we witnessed back in December 2012 and January 2013, while every new deal is marking a lower last done, which is also the benchmark for the negotiation of the next sale candidate.
It was this time two years ago, in our brokers insight once more just before the Xmas holidays that we mentioned that we are facing low ship values that pose a great opportunity for anyone proceeding with purchases to possibly achieve an asset play. Buy low sell higher! And yes that was the case. Definitely we were no prophets, nor in a possession of a crystal bowl. It was just a clear observation of market fundamentals, and the shipping business cycles that always bring these spikes and enable investors to better ride the waves of the cycle.
So what are the fundamentals now? Bunker prices are at a 5 year low, the Japanese Yen reached a seven year low against the US Dollar, the Euro to the Dollar may be soon approaching 1.15 according to some, the Russian economy presently looks Rubbled... sorry meant troubled, iron ore prices are phenomenally low, China’s softening appetite in November has been weighing down on Capes and mineral export bans from Indonesia hurt further the Pacific trade. At the same time the scrap price offered in China is at $220-$230/ton and price levels have also been dropping sharply in the Indian Subcontinent. Most notably, the overall scrap activity for 2014 is 30% less than that of last year, while newbuilding ordering in 2014 is almost 50% down compared to 2013 levels.
A very simplistic approach says that during a bad market when freight rates suffer, the normal is that ship prices correct. Definitely some owners lose their sleep during this period, however others are seeing this as a golden opportunity to buy low, support their investment until rates improve and once their asset gains in value, lock in the profits. Bankers always say that a business proposal should be viable with all figures “adding-up” positively… however these proposals never take into account the value of asset play. A business deal in which you are buying low, is usually one taking place in a freight environment which doesn’t make sense for a banker to invest in, but is usually the one that will most probably offer the opportunity to asset play.
Fasten your seatbelt, the cycle ahead might be bumpy. My best and warmest wishes to all of you and all friends and colleagues that have been showing their continual support throughout the years.
” Kali Chronia” as we say in Greece!
By ohn N. Cotzias, Intermodal SnP Broker
Compiled by:
Intermodal Research & Valuations
Analysts:
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.
Information contained within the website of COALspot.com is intended for informational purposes only and is not intended as professional counsel and should not be used as such.
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Friday, 30 January 15
U.S. YEAR-TO-DATE COAL PRODUCTION REACHED 65.7 MMST
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19.9 million short tons (mmst) of coal ...
Friday, 30 January 15
CAN BULKER CONVERSIONS SPOIL THE TANKER MARKET'S PARTY? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Oversupply of tonnage has always been in the back of the head of ship owners when it comes to taking advantage of favorable market conditions. As s ...
Thursday, 29 January 15
CHINA ENERGY DEMAND MUST BE REVIEWED DUE TO FUNDAMENTAL ECONOMIC CHANGES - WOOD MACKENZIE
New patterns emerging as energy demand growth decoupled significantly from GDP growth for the first time in 2014
Wood Mackenzie says 2014 was ...
Thursday, 29 January 15
CAPE MARKET IS STILL STRUGGLING WITH LOW DEMAND AND LOW COMMODITY PRICES
Handy
Supramax rates are heading south with slipping rates all across the block. USG activity is slow with mid-week levels in the mid 8.000s, Fea ...
Wednesday, 28 January 15
MARKET INSIGHT - STELIOS KOLLINTZAS
With most traders having returned to action from year end festivities, we have already seen signs of activity in the specialized product markets. L ...
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- Billiton Holdings Pty Ltd - Australia
- Chamber of Mines of South Africa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Straits Asia Resources Limited - Singapore
- International Coal Ventures Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Indian Oil Corporation Limited
- VISA Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Ministry of Finance - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GMR Energy Limited - India
- Minerals Council of Australia
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- Parry Sugars Refinery, India
- Star Paper Mills Limited - India
- Central Java Power - Indonesia
- Essar Steel Hazira Ltd - India
- Intertek Mineral Services - Indonesia
- TeaM Sual Corporation - Philippines
- Attock Cement Pakistan Limited
- Merrill Lynch Commodities Europe
- Deloitte Consulting - India
- Mercuria Energy - Indonesia
- Standard Chartered Bank - UAE
- Bukit Baiduri Energy - Indonesia
- Makarim & Taira - Indonesia
- Indogreen Group - Indonesia
- Bangladesh Power Developement Board
- South Luzon Thermal Energy Corporation
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Maheswari Brothers Coal Limited - India
- The State Trading Corporation of India Ltd
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercator Lines Limited - India
- Thai Mozambique Logistica
- Commonwealth Bank - Australia
- Interocean Group of Companies - India
- Pipit Mutiara Jaya. PT, Indonesia
- The University of Queensland
- PNOC Exploration Corporation - Philippines
- Meralco Power Generation, Philippines
- Independent Power Producers Association of India
- The Treasury - Australian Government
- Miang Besar Coal Terminal - Indonesia
- Ambuja Cements Ltd - India
- Malabar Cements Ltd - India
- Madhucon Powers Ltd - India
- IEA Clean Coal Centre - UK
- Xindia Steels Limited - India
- Medco Energi Mining Internasional
- Riau Bara Harum - Indonesia
- CNBM International Corporation - China
- Orica Mining Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Posco Energy - South Korea
- Larsen & Toubro Limited - India
- Renaissance Capital - South Africa
- Bayan Resources Tbk. - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Bhatia International Limited - India
- Parliament of New Zealand
- Indo Tambangraya Megah - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Economic Council, Georgia
- Wood Mackenzie - Singapore
- Gujarat Sidhee Cement - India
- CIMB Investment Bank - Malaysia
- Carbofer General Trading SA - India
- Leighton Contractors Pty Ltd - Australia
- Jorong Barutama Greston.PT - Indonesia
- Goldman Sachs - Singapore
- Latin American Coal - Colombia
- Sree Jayajothi Cements Limited - India
- Kumho Petrochemical, South Korea
- Planning Commission, India
- India Bulls Power Limited - India
- Grasim Industreis Ltd - India
- SN Aboitiz Power Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Meenaskhi Energy Private Limited - India
- Energy Link Ltd, New Zealand
- LBH Netherlands Bv - Netherlands
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Mjunction Services Limited - India
- European Bulk Services B.V. - Netherlands
- Borneo Indobara - Indonesia
- Central Electricity Authority - India
- Rio Tinto Coal - Australia
- Cigading International Bulk Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Thiess Contractors Indonesia
- Semirara Mining Corp, Philippines
- Tamil Nadu electricity Board
- Karbindo Abesyapradhi - Indoneisa
- Dalmia Cement Bharat India
- Tata Chemicals Ltd - India
- Savvy Resources Ltd - HongKong
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Transport, Egypt
- Petrochimia International Co. Ltd.- Taiwan
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- Sojitz Corporation - Japan
- London Commodity Brokers - England
- Bhushan Steel Limited - India
- OPG Power Generation Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Electricity Generating Authority of Thailand
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Globalindo Alam Lestari - Indonesia
- Aditya Birla Group - India
- Sindya Power Generating Company Private Ltd
- White Energy Company Limited
- PowerSource Philippines DevCo
- Siam City Cement PLC, Thailand
- Barasentosa Lestari - Indonesia
- Coalindo Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Jaiprakash Power Ventures ltd
- Karaikal Port Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Sarangani Energy Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Kartika Selabumi Mining - Indonesia
- Marubeni Corporation - India
- Bahari Cakrawala Sebuku - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Eastern Coal Council - USA
- Indian Energy Exchange, India
- Petron Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Heidelberg Cement - Germany
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Romanian Commodities Exchange
- Global Coal Blending Company Limited - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Wilmar Investment Holdings
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Manunggal Multi Energi - Indonesia
- PTC India Limited - India
- GVK Power & Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Kideco Jaya Agung - Indonesia
- Global Green Power PLC Corporation, Philippines
- Electricity Authority, New Zealand
- Baramulti Group, Indonesia
- Antam Resourcindo - Indonesia
- Global Business Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- Australian Commodity Traders Exchange
- Singapore Mercantile Exchange
- ICICI Bank Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Holcim Trading Pte Ltd - Singapore
- Formosa Plastics Group - Taiwan
- McConnell Dowell - Australia
- San Jose City I Power Corp, Philippines
- Port Waratah Coal Services - Australia
- Ind-Barath Power Infra Limited - India
- Metalloyd Limited - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- Edison Trading Spa - Italy
- Australian Coal Association
- Therma Luzon, Inc, Philippines
- Vedanta Resources Plc - India
- Uttam Galva Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Energy Development Corp, Philippines
- ASAPP Information Group - India
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- Pendopo Energi Batubara - Indonesia
- Mintek Dendrill Indonesia
- Directorate Of Revenue Intelligence - India
- Gujarat Mineral Development Corp Ltd - India
- Kepco SPC Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Ministry of Mines - Canada
- Banpu Public Company Limited - Thailand
- IHS Mccloskey Coal Group - USA
- Sakthi Sugars Limited - India
- Timah Investasi Mineral - Indoneisa
- Vizag Seaport Private Limited - India
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- Salva Resources Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Eastern Energy - Thailand
- MS Steel International - UAE
- Indika Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- Bharathi Cement Corporation - India
- Sical Logistics Limited - India
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