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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 $6,212/day in the first half. For the first time signs of real distress are apparent. After 8 years, dry bulk sentiment finally collapsed and bulker orders fell from 16m dwt in January 2014 to 0.05m dwt in June 2015. A helpful step towards market recovery, but it leaves the shipyards with a problem. Over the last 8 years bulkers were a third of shipyard workload (see inset pie chart). Although tankers and container ships are still being ordered, they show no sign of filling the gap left by bulkers.
Dance Macabre
So there you have it. Bulkers have finally made a meaningful move towards better times by cutting investment. But the game isn’t over yet. They still need a strong world economy and continued Chinese import growth. Meanwhile a new chess game with destiny is getting started, this time in the shipyards as they try to plug the bulker gap. Maybe the game’s not over yet. So if you want a nice relaxing summer, our advice is don’t watch The Seventh Seal.
Source: Clarksons | Hellenic Shipping News
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Friday, 14 August 15
CONDITIONS AND COMPLEXITIES IN A TRIPARTITE AGREEMENT: BE SPECIFIC! - INCE & CO
KNOWLEDGE TO ELEVATE
A tripartite agreement reached between the Owners, the Shippers and the Receivers provided that demurrage be paid to the ...
Thursday, 13 August 15
THE RATES FOR CAPES KEPT RALLYING LAST WEEK - INTERMODAL
COALspot.com: Strong Capesize performance kept supporting the Dry Bulk market last week, which noted another positive weekly closing, while rates f ...
Thursday, 13 August 15
FOB RICHARDS BAY COAL SWAPS CONTINUE FALLING
COALspot.com: API4 FOB Richards Bay Coal swap for delivery 4Q' 2015 declined month over month and week over week.
The 4Q swap was down US$ ...
Wednesday, 12 August 15
DRY BULK MARKET: WITHOUT A DOUBT REACHED HEALTHIER LEVEL
A few weeks before the end of the summer season, the BDI is hovering around 1,200 points, providing some much needed optimism to all Dry Bulk marke ...
Wednesday, 12 August 15
REGULATION CURBS POWER OF LOCAL AUTHORITIES IN MINING SECTOR IN INDONESIA - FLORENCE G. SANTOSO
The Indonesian Government appears to be getting serious about stripping Regents of the authority to issue mining licenses. The Government took the ...
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- Wilmar Investment Holdings
- Vizag Seaport Private Limited - India
- Jindal Steel & Power Ltd - India
- Indian Oil Corporation Limited
- PTC India Limited - India
- Gujarat Electricity Regulatory Commission - India
- Maheswari Brothers Coal Limited - India
- Georgia Ports Authority, United States
- Gujarat Sidhee Cement - India
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- Indian Energy Exchange, India
- Commonwealth Bank - Australia
- Leighton Contractors Pty Ltd - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vedanta Resources Plc - India
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Interocean Group of Companies - India
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- Romanian Commodities Exchange
- Kaltim Prima Coal - Indonesia
- Sakthi Sugars Limited - India
- Chamber of Mines of South Africa
- Barasentosa Lestari - Indonesia
- Meenaskhi Energy Private Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tata Chemicals Ltd - India
- SMG Consultants - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Green Power PLC Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Central Java Power - Indonesia
- Bhoruka Overseas - Indonesia
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Bangladesh Power Developement Board
- Renaissance Capital - South Africa
- Orica Mining Services - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement - Thailand
- Krishnapatnam Port Company Ltd. - India
- Sarangani Energy Corporation, Philippines
- Star Paper Mills Limited - India
- Coalindo Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Energy Link Ltd, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Sojitz Corporation - Japan
- Mjunction Services Limited - India
- Baramulti Group, Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement PLC, Thailand
- Bukit Makmur.PT - Indonesia
- Semirara Mining and Power Corporation, Philippines
- ICICI Bank Limited - India
- Edison Trading Spa - Italy
- CNBM International Corporation - China
- Cement Manufacturers Association - India
- Straits Asia Resources Limited - Singapore
- Riau Bara Harum - Indonesia
- Goldman Sachs - Singapore
- Ministry of Finance - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- OPG Power Generation Pvt Ltd - India
- Mercator Lines Limited - India
- Anglo American - United Kingdom
- The State Trading Corporation of India Ltd
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Borneo Indobara - Indonesia
- Banpu Public Company Limited - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- Attock Cement Pakistan Limited
- Asmin Koalindo Tuhup - Indonesia
- Aboitiz Power Corporation - Philippines
- GAC Shipping (India) Pvt Ltd
- Bhatia International Limited - India
- Planning Commission, India
- Malabar Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- Larsen & Toubro Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Indogreen Group - Indonesia
- Thai Mozambique Logistica
- Manunggal Multi Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Kobexindo Tractors - Indoneisa
- Trasteel International SA, Italy
- International Coal Ventures Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- McConnell Dowell - Australia
- Economic Council, Georgia
- Ministry of Transport, Egypt
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- Latin American Coal - Colombia
- AsiaOL BioFuels Corp., Philippines
- Karbindo Abesyapradhi - Indoneisa
- Sree Jayajothi Cements Limited - India
- Merrill Lynch Commodities Europe
- Pendopo Energi Batubara - Indonesia
- Orica Australia Pty. Ltd.
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- Miang Besar Coal Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Electricity Generating Authority of Thailand
- South Luzon Thermal Energy Corporation
- Australian Commodity Traders Exchange
- Bharathi Cement Corporation - India
- Alfred C Toepfer International GmbH - Germany
- Eastern Energy - Thailand
- Standard Chartered Bank - UAE
- Uttam Galva Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Intertek Mineral Services - Indonesia
- Tamil Nadu electricity Board
- Oldendorff Carriers - Singapore
- Iligan Light & Power Inc, Philippines
- Electricity Authority, New Zealand
- Parry Sugars Refinery, India
- Metalloyd Limited - United Kingdom
- SN Aboitiz Power Inc, Philippines
- GVK Power & Infra Limited - India
- Independent Power Producers Association of India
- Kalimantan Lumbung Energi - Indonesia
- The University of Queensland
- Directorate General of MIneral and Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Mercuria Energy - Indonesia
- Dalmia Cement Bharat India
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Ind-Barath Power Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sical Logistics Limited - India
- VISA Power Limited - India
- Semirara Mining Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Posco Energy - South Korea
- Deloitte Consulting - India
- Lanco Infratech Ltd - India
- Bhushan Steel Limited - India
- Indo Tambangraya Megah - Indonesia
- Antam Resourcindo - Indonesia
- Rio Tinto Coal - Australia
- Parliament of New Zealand
- Power Finance Corporation Ltd., India
- Central Electricity Authority - India
- Meralco Power Generation, Philippines
- Wood Mackenzie - Singapore
- Global Business Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Coastal Gujarat Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Indonesian Coal Mining Association
- Videocon Industries ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Heidelberg Cement - Germany
- Formosa Plastics Group - Taiwan
- Africa Commodities Group - South Africa
- Holcim Trading Pte Ltd - Singapore
- India Bulls Power Limited - India
- Minerals Council of Australia
- Ministry of Mines - Canada
- Jaiprakash Power Ventures ltd
- Binh Thuan Hamico - Vietnam
- Indika Energy - Indonesia
- Simpson Spence & Young - Indonesia
- IHS Mccloskey Coal Group - USA
- PNOC Exploration Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Coal and Oil Company - UAE
- LBH Netherlands Bv - Netherlands
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- ASAPP Information Group - India
- Aditya Birla Group - India
- PetroVietnam Power Coal Import and Supply Company
- New Zealand Coal & Carbon
- Essar Steel Hazira Ltd - India
- Global Coal Blending Company Limited - Australia
- Makarim & Taira - Indonesia
- Thiess Contractors Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Australian Coal Association
- Singapore Mercantile Exchange
- Ceylon Electricity Board - Sri Lanka
- Cigading International Bulk Terminal - Indonesia
- Bulk Trading Sa - Switzerland
- Toyota Tsusho Corporation, Japan
- Rashtriya Ispat Nigam Limited - India
- European Bulk Services B.V. - Netherlands
- Globalindo Alam Lestari - Indonesia
- Grasim Industreis Ltd - India
- Directorate Of Revenue Intelligence - India
- Mintek Dendrill Indonesia
- The Treasury - Australian Government
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