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Tuesday, 04 August 15
SHIPPING CYCLES - A CHESS GAME YOU DON'T WANT TO LOSE - CLARKSONS
 Ingmar Bergman’s classic movie The Seventh Seal is about a knight who, during the Black Death, challenges Death to a chess match, in the hope that while the game continues he can put off his demise. This grim epic could be seen as a metaphor for the daunting progress through long shipping cycles, as one risk-laden move in the toxic chess game follows another.
August 2007 – The Game Starts
Today’s cycle started eight years ago in 2007. It was an epic year. Capesize earnings averaged over $110,000/day and merchant shipbuilding investment reached a record $229 billion (excluding offshore). But there was good reason to be apprehensive. In August the first signs of the financial crisis hit Europe, as interbank investors grew paranoid about the vulnerability of their counterparties to CDO exposure, bringing Eurodollar trading to a halt. Meanwhile analysts were worried that the Chinese super-boom would peak out after the Olympic Games in 2008. So although dry bulk investors were still making money and ordering ships, the solitary chess game with destiny had already started.
Mounting A Comeback
Seven years later the chess game is still going on. The financial crisis got off to a more dramatic start than anyone anticipated. In 2008 as panic swept through financial markets and trade credit became almost unobtainable, the world economy, including China, came precariously close to meltdown. But fortunately this time the politicians eased through the crisis successfully. China mounted a heroic infrastructure programme which gave bulkers a very decent boom in 2009-10. Following this the market fluctuated, but reached decent levels in late 2011 and again in late 2013.
Not Deadly Or Distressed?
As recessions go so far the game with destiny has gone quite well. Since the end of 2007 Capesize earnings have averaged $32,300/day and the market has soaked up 490m dwt of new bulkers. In 2013, 104m dwt of bulkers were ordered. So someone in the industry believed bulkers would win their chess game.
But in 2015 the game changed. Capesize earnings averaged only $6,212/day in the first half. For the first time signs of real distress are apparent. After 8 years, dry bulk sentiment finally collapsed and bulker orders fell from 16m dwt in January 2014 to 0.05m dwt in June 2015. A helpful step towards market recovery, but it leaves the shipyards with a problem. Over the last 8 years bulkers were a third of shipyard workload (see inset pie chart). Although tankers and container ships are still being ordered, they show no sign of filling the gap left by bulkers.
Dance Macabre
So there you have it. Bulkers have finally made a meaningful move towards better times by cutting investment. But the game isn’t over yet. They still need a strong world economy and continued Chinese import growth. Meanwhile a new chess game with destiny is getting started, this time in the shipyards as they try to plug the bulker gap. Maybe the game’s not over yet. So if you want a nice relaxing summer, our advice is don’t watch The Seventh Seal.
Source: Clarksons | Hellenic Shipping News
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Friday, 11 September 15
SHIPPING MARKETS SHOW MIXED EMOTIONS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has managed to show marginal improvements over the past few days, with the Capesize segment faring better than smaller dry bulk ...
Friday, 11 September 15
U.S'S WEEKLY COAL PRODUCTION WAS ALMOST FLAT PAST WEEK
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 18.6 million shor ...
Thursday, 10 September 15
U.S. H1' 15 STEAM COAL EXPORTS FELL BY 21 PER CENT Y-Y: EIA
Coal Trade
Slower growth in world coal demand, lower international coal prices, and higher coal output in other coal-exporting countries have all ...
Thursday, 10 September 15
INDONESIAN COAL BENCHMARK PRICE HITS A NEW LOW OF $58.21 PER TON
COALspot.com - The Director General of Mineral and Coal of Indonesia once a again revised down Indonesian coal benchmark price to US$ 58.21 per MT ...
Thursday, 10 September 15
IF NOT NOW, WHEN? - GIANNIS ANDRITSOPOULOS
Our industry is well known to be cyclical with some cycles lasting longer than others. Despite the fact that these shifts in the behavior of the fr ...
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- Ministry of Finance - Indonesia
- The University of Queensland
- Indogreen Group - Indonesia
- McConnell Dowell - Australia
- Banpu Public Company Limited - Thailand
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Uttam Galva Steels Limited - India
- Tata Chemicals Ltd - India
- Madhucon Powers Ltd - India
- Siam City Cement PLC, Thailand
- Borneo Indobara - Indonesia
- London Commodity Brokers - England
- Malabar Cements Ltd - India
- International Coal Ventures Pvt Ltd - India
- Minerals Council of Australia
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- Kaltim Prima Coal - Indonesia
- Price Waterhouse Coopers - Russia
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Transport, Egypt
- Sinarmas Energy and Mining - Indonesia
- Sical Logistics Limited - India
- Trasteel International SA, Italy
- Meenaskhi Energy Private Limited - India
- Savvy Resources Ltd - HongKong
- Gujarat Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Dalmia Cement Bharat India
- Samtan Co., Ltd - South Korea
- Kartika Selabumi Mining - Indonesia
- Formosa Plastics Group - Taiwan
- Attock Cement Pakistan Limited
- Makarim & Taira - Indonesia
- Ind-Barath Power Infra Limited - India
- Antam Resourcindo - Indonesia
- New Zealand Coal & Carbon
- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indian Oil Corporation Limited
- MS Steel International - UAE
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Sindya Power Generating Company Private Ltd
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Global Business Power Corporation, Philippines
- PowerSource Philippines DevCo
- Wood Mackenzie - Singapore
- Indika Energy - Indonesia
- Australian Coal Association
- Meralco Power Generation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Tamil Nadu electricity Board
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- IHS Mccloskey Coal Group - USA
- CIMB Investment Bank - Malaysia
- Ministry of Mines - Canada
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- Xindia Steels Limited - India
- Chamber of Mines of South Africa
- Orica Australia Pty. Ltd.
- Pipit Mutiara Jaya. PT, Indonesia
- Barasentosa Lestari - Indonesia
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kumho Petrochemical, South Korea
- Mintek Dendrill Indonesia
- European Bulk Services B.V. - Netherlands
- Eastern Coal Council - USA
- Gujarat Mineral Development Corp Ltd - India
- Rashtriya Ispat Nigam Limited - India
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- Agrawal Coal Company - India
- Goldman Sachs - Singapore
- Bangladesh Power Developement Board
- Asmin Koalindo Tuhup - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PetroVietnam Power Coal Import and Supply Company
- Global Coal Blending Company Limited - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Parliament of New Zealand
- Indian Energy Exchange, India
- Bharathi Cement Corporation - India
- Sakthi Sugars Limited - India
- Aboitiz Power Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Coalindo Energy - Indonesia
- Mercator Lines Limited - India
- Rio Tinto Coal - Australia
- GMR Energy Limited - India
- Holcim Trading Pte Ltd - Singapore
- Leighton Contractors Pty Ltd - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Wilmar Investment Holdings
- Larsen & Toubro Limited - India
- Edison Trading Spa - Italy
- Star Paper Mills Limited - India
- Semirara Mining Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Grasim Industreis Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Sarangani Energy Corporation, Philippines
- Electricity Authority, New Zealand
- TeaM Sual Corporation - Philippines
- Interocean Group of Companies - India
- Videocon Industries ltd - India
- Eastern Energy - Thailand
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Heidelberg Cement - Germany
- Altura Mining Limited, Indonesia
- Electricity Generating Authority of Thailand
- Central Java Power - Indonesia
- Marubeni Corporation - India
- Central Electricity Authority - India
- Bahari Cakrawala Sebuku - Indonesia
- Indonesian Coal Mining Association
- CNBM International Corporation - China
- Cigading International Bulk Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Baramulti Group, Indonesia
- GAC Shipping (India) Pvt Ltd
- Australian Commodity Traders Exchange
- GN Power Mariveles Coal Plant, Philippines
- OPG Power Generation Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- Bhushan Steel Limited - India
- Singapore Mercantile Exchange
- Kepco SPC Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Posco Energy - South Korea
- Renaissance Capital - South Africa
- Mercuria Energy - Indonesia
- VISA Power Limited - India
- PTC India Limited - India
- Romanian Commodities Exchange
- Miang Besar Coal Terminal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Africa Commodities Group - South Africa
- San Jose City I Power Corp, Philippines
- Thai Mozambique Logistica
- Latin American Coal - Colombia
- Aditya Birla Group - India
- Power Finance Corporation Ltd., India
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Siam City Cement - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- GVK Power & Infra Limited - India
- Binh Thuan Hamico - Vietnam
- Petrochimia International Co. Ltd.- Taiwan
- Straits Asia Resources Limited - Singapore
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Timah Investasi Mineral - Indoneisa
- Orica Mining Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- India Bulls Power Limited - India
- Petron Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Metalloyd Limited - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- Riau Bara Harum - Indonesia
- Lanco Infratech Ltd - India
- Kideco Jaya Agung - Indonesia
- Planning Commission, India
- Semirara Mining and Power Corporation, Philippines
- Economic Council, Georgia
- Krishnapatnam Port Company Ltd. - India
- Bhatia International Limited - India
- South Luzon Thermal Energy Corporation
- Intertek Mineral Services - Indonesia
- Standard Chartered Bank - UAE
- Maheswari Brothers Coal Limited - India
- Oldendorff Carriers - Singapore
- Mjunction Services Limited - India
- Port Waratah Coal Services - Australia
- Cement Manufacturers Association - India
- Merrill Lynch Commodities Europe
- Commonwealth Bank - Australia
- Directorate General of MIneral and Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- Bukit Baiduri Energy - Indonesia
- Energy Link Ltd, New Zealand
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