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Friday, 10 April 15
DRY BULK MARKET'S DOWNFALL ALSO OFFER INVESTMENT BARGAINS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
 Dry bulk market rates have fallen to historical lows over the past few weeks, with no clear path of recovery, at least in the near term. As such, most ship owners are finding themselves caught “between a rock and hard place”. But is it really this the case? Some shipbrokers believe that the current market environment has also one important side effect, the fall of asset prices, which means that dry bulk ships are getting cheaper by the day. As such, cash-rich ship owners could easily take advantage of knock down prices, especially as more and more distressed sales could emerge in the coming weeks.
According to the latest report from shipbroker Allied Shipbroking, “while dry bulk owners start to feel that they have managed to get out of one bad patch, everyone starts to point at yet another up ahead. It seems to be a perfect storm unfolding and one that many will claim was more than expected. Yet amidst poor sentiment in the freight market is were real opportunity is born. The market will eventually recovery and those who manage to take the right pickings during the bottom are often herald as the pioneers and holders of true foresight of what lays ahead. However it is never as clear as that. Taking on any investment decision, as things stand now, seems to be bor-derline crazy. Earnings are hovering at around OPEX levels, often with owners search-ing into their own pockets in order to cover the cost of voyages they have fixed”, said Mr. George Lazaridis, Head of Market Research & Asset Valuations.
He added that “amidst all this pessimism is where you will also find sufficient discounts in the prices of secondhand assets which will provide the ample promise for reward that would com-pensate the current risk. One such size segment that shows to have a good ratio of risk against potential reward is that of the Hadysize vessels and particularly modern vessels on the larger end of the size spectrum (ie.35-38,000dwt). Prices for these assets have never been lower and compared to placing a new contracting on one of the “hungry for orders” shipyards, the discount is more than enough. At a price of US$ 13.5m for a 5 year old unit you get a discount of close to 40% which is equal to close to 8% deprecia-tion in value per year. But one may ask, why is this any different to the larger Supras and Panamaxes which offer similar if not better discounts on modern units?”.
“Handysize vessels seem to hold one more ace up the sleeve. Last month we witnessed yet another drop in size of the fleet in terms of number of vessels. The fleet now stands now stands at 2,437 which is only 3 more vessels then what there was on the 1st of January 2015. This becomes all the more noteworthy when you consider that this has happened during a period in the year were new building deliveries are more intense (everyone wants to benefit from having their vessel written as built in the new year), while also worth noting is the limited orderbook compared to the strong number of vessels in the fleet which are currently over 25 years of age”, said Lazaridis.
Earlier in the week, ship owner Pacific Basin, which is focused in the smaller ship classes, said that “in the Handysize and Handymax segments, where “market spot rates averaged US$5,070 and US$6,110 per day net respectively in the first quarter of 2015, representing a 45% reduction in average rates compared to the same period last year. Newbuilding deliveries deferred from 2014 into January and February coincided with the lunar new year holidays seasonal demand slowdown in China and seasonal export disruptions in key trade areas. Together, these pulled the Baltic Dry Index (BDI) to its lowest since indices began in 1985. However, spot market rates for Handysize and Handymax vessels have gradually improved since lunar new year, albeit from a very low base”, concluded Pacific Basin”.
Lazaridis concluded his analysis by noting that “all this put together allows for better prospects and in essence lower risk while providing comparatively similar asset play returns (in percentage terms) with that of the larger sizes. To close off, it is always worth noting that there is a bright side to every market slump as there is also a dark side to every market boom. Both need caution and proper estimating of the kind of risk/reward one engages with”.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Friday, 08 May 15
COAL PRODUCTION IN U.S. UP 3.2% THIS PAST WEEK - EIA
COALspot.com – United States the second largest coal producer in the world has produced approximately totaled an estimated 17.4 million short ...
Wednesday, 06 May 15
COMBINATION OF HOLIDAYS AND A SHAKY MARKET PUT ADDITIONAL PRESSURE ON RATES
COALspot.com: The combination of holidays and a shaky market is always a recipe for additional pressure on rates and last week was no exception. Wi ...
Wednesday, 06 May 15
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
The first four months of 2015 are now behind us and they make up for a decent amount of time to look back and assess how the year is evolving so fa ...
Tuesday, 05 May 15
MIFA BERSAUDARA UNIT OF ABM INVESTAMA STARTS OPERATING $200M COAL MINE IN ACEH
Reswara Minergi Hartama, a coal mining unit of coal miner ABM Investama known as known as Reswara, inaugurated a $200 million integrated coal minin ...
Tuesday, 05 May 15
FREIGHT DERIVATIVE VOLUMES REACHED TOTALED 14,154 CONTRACTS IN APRIL - SGX
COALspot.com: “Our unique suite of freight and bulk commodity products provides market participants with a wide range of trading strategies a ...
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- Coal and Oil Company - UAE
- Aboitiz Power Corporation - Philippines
- MS Steel International - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- Star Paper Mills Limited - India
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Indo Tambangraya Megah - Indonesia
- European Bulk Services B.V. - Netherlands
- Medco Energi Mining Internasional
- Karbindo Abesyapradhi - Indoneisa
- Sree Jayajothi Cements Limited - India
- Indogreen Group - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Madhucon Powers Ltd - India
- CIMB Investment Bank - Malaysia
- Central Java Power - Indonesia
- Electricity Generating Authority of Thailand
- Neyveli Lignite Corporation Ltd, - India
- Grasim Industreis Ltd - India
- Jindal Steel & Power Ltd - India
- Thai Mozambique Logistica
- Holcim Trading Pte Ltd - Singapore
- Semirara Mining Corp, Philippines
- The University of Queensland
- OPG Power Generation Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Chettinad Cement Corporation Ltd - India
- Renaissance Capital - South Africa
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- Cement Manufacturers Association - India
- Indika Energy - Indonesia
- ICICI Bank Limited - India
- Bharathi Cement Corporation - India
- Bhatia International Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Essar Steel Hazira Ltd - India
- Sinarmas Energy and Mining - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Orica Australia Pty. Ltd.
- Price Waterhouse Coopers - Russia
- Orica Mining Services - Indonesia
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- International Coal Ventures Pvt Ltd - India
- Commonwealth Bank - Australia
- Rio Tinto Coal - Australia
- Billiton Holdings Pty Ltd - Australia
- Marubeni Corporation - India
- PowerSource Philippines DevCo
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- Alfred C Toepfer International GmbH - Germany
- Meralco Power Generation, Philippines
- SMG Consultants - Indonesia
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Parry Sugars Refinery, India
- GMR Energy Limited - India
- Jorong Barutama Greston.PT - Indonesia
- CNBM International Corporation - China
- Dalmia Cement Bharat India
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Asmin Koalindo Tuhup - Indonesia
- Wood Mackenzie - Singapore
- The Treasury - Australian Government
- Sarangani Energy Corporation, Philippines
- Trasteel International SA, Italy
- Gujarat Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Standard Chartered Bank - UAE
- Malabar Cements Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Makarim & Taira - Indonesia
- Ind-Barath Power Infra Limited - India
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- Videocon Industries ltd - India
- Barasentosa Lestari - Indonesia
- Bhoruka Overseas - Indonesia
- Ministry of Finance - Indonesia
- Binh Thuan Hamico - Vietnam
- Samtan Co., Ltd - South Korea
- Uttam Galva Steels Limited - India
- Miang Besar Coal Terminal - Indonesia
- The State Trading Corporation of India Ltd
- Formosa Plastics Group - Taiwan
- Independent Power Producers Association of India
- Aditya Birla Group - India
- TNB Fuel Sdn Bhd - Malaysia
- Siam City Cement - Thailand
- Banpu Public Company Limited - Thailand
- Bukit Baiduri Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Minerals Council of Australia
- Oldendorff Carriers - Singapore
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Attock Cement Pakistan Limited
- PTC India Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Deloitte Consulting - India
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Jaiprakash Power Ventures ltd
- Electricity Authority, New Zealand
- Iligan Light & Power Inc, Philippines
- Savvy Resources Ltd - HongKong
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Meenaskhi Energy Private Limited - India
- Ministry of Mines - Canada
- Sical Logistics Limited - India
- Kobexindo Tractors - Indoneisa
- Lanco Infratech Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Borneo Indobara - Indonesia
- Indian Energy Exchange, India
- Simpson Spence & Young - Indonesia
- London Commodity Brokers - England
- ASAPP Information Group - India
- Globalindo Alam Lestari - Indonesia
- SMC Global Power, Philippines
- Parliament of New Zealand
- Edison Trading Spa - Italy
- Leighton Contractors Pty Ltd - Australia
- Australian Coal Association
- Sojitz Corporation - Japan
- San Jose City I Power Corp, Philippines
- Singapore Mercantile Exchange
- Kepco SPC Power Corporation, Philippines
- Carbofer General Trading SA - India
- Semirara Mining and Power Corporation, Philippines
- Sakthi Sugars Limited - India
- Global Green Power PLC Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Mjunction Services Limited - India
- Energy Development Corp, Philippines
- Antam Resourcindo - Indonesia
- Eastern Energy - Thailand
- Energy Link Ltd, New Zealand
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- GN Power Mariveles Coal Plant, Philippines
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Vedanta Resources Plc - India
- Central Electricity Authority - India
- Manunggal Multi Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- White Energy Company Limited
- Ceylon Electricity Board - Sri Lanka
- Pipit Mutiara Jaya. PT, Indonesia
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Merrill Lynch Commodities Europe
- Larsen & Toubro Limited - India
- Agrawal Coal Company - India
- VISA Power Limited - India
- Toyota Tsusho Corporation, Japan
- India Bulls Power Limited - India
- Bangladesh Power Developement Board
- Karaikal Port Pvt Ltd - India
- Interocean Group of Companies - India
- Bulk Trading Sa - Switzerland
- Thiess Contractors Indonesia
- Africa Commodities Group - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Baramulti Group, Indonesia
- Kideco Jaya Agung - Indonesia
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Georgia Ports Authority, United States
- Siam City Cement PLC, Thailand
- Goldman Sachs - Singapore
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- South Luzon Thermal Energy Corporation
- Latin American Coal - Colombia
- Metalloyd Limited - United Kingdom
- Gujarat Mineral Development Corp Ltd - India
- Global Business Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Mercator Lines Limited - India
- Anglo American - United Kingdom
- Riau Bara Harum - Indonesia
- Wilmar Investment Holdings
- Romanian Commodities Exchange
- Petron Corporation, Philippines
- Xindia Steels Limited - India
- Indonesian Coal Mining Association
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