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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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Wednesday, 05 August 15
SHIPPING MARKET INSIGHT - KATERINA RESTIS
On July 14th, 2015 a historical consensus was reached in Vienna between Iran and the five permanent members of the U.N. Security Council, plus Germ ...
Wednesday, 05 August 15
COAL CONSUMPTION POSTED THE STRONGEST GROWTH AMONG THE FOSSIL ENERGY SOURCES IN 2014 - VDKI
Coal 2014: again the world's fastest-growing primary energy source and an indispensable asset for the success of the energy turnaround.
Ac ...
Wednesday, 05 August 15
FOB INDONESIA THERMAL COAL SWAPS FALL
COALspot.com: Indonesian coal swap for delivery 4Q 2015 declined month on month and week over week, this past week.
The 4Q swap was declined $ ...
Wednesday, 05 August 15
DRY BULKER PRICES START TO FIRM UP AS MARKET SENTIMENT IMPROVES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Market pessimism in the dry bulk industry, a trend which had established itself over the course of the year, has started to fade away over the past ...
Tuesday, 04 August 15
FOB RICHARDS BAY COAL SWAPS CONTINUE TO FALL DUE TO SLIDING DEMAND
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$ ...
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- Chettinad Cement Corporation Ltd - India
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- Bank of Tokyo Mitsubishi UFJ Ltd
- Pipit Mutiara Jaya. PT, Indonesia
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- Indian Energy Exchange, India
- Therma Luzon, Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Grasim Industreis Ltd - India
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- Mjunction Services Limited - India
- Siam City Cement - Thailand
- Electricity Authority, New Zealand
- Straits Asia Resources Limited - Singapore
- Central Electricity Authority - India
- Agrawal Coal Company - India
- Posco Energy - South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- CNBM International Corporation - China
- Ind-Barath Power Infra Limited - India
- PowerSource Philippines DevCo
- Semirara Mining and Power Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Business Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
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- Orica Mining Services - Indonesia
- Heidelberg Cement - Germany
- Cigading International Bulk Terminal - Indonesia
- PNOC Exploration Corporation - Philippines
- Borneo Indobara - Indonesia
- Thai Mozambique Logistica
- Independent Power Producers Association of India
- Kumho Petrochemical, South Korea
- Holcim Trading Pte Ltd - Singapore
- Globalindo Alam Lestari - Indonesia
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Meenaskhi Energy Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- AsiaOL BioFuels Corp., Philippines
- SMG Consultants - Indonesia
- ICICI Bank Limited - India
- Malabar Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Indian Oil Corporation Limited
- LBH Netherlands Bv - Netherlands
- Essar Steel Hazira Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Mercuria Energy - Indonesia
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- Wood Mackenzie - Singapore
- Carbofer General Trading SA - India
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- Mercator Lines Limited - India
- Edison Trading Spa - Italy
- Indika Energy - Indonesia
- Antam Resourcindo - Indonesia
- Meralco Power Generation, Philippines
- Parry Sugars Refinery, India
- Price Waterhouse Coopers - Russia
- Rio Tinto Coal - Australia
- Global Green Power PLC Corporation, Philippines
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- VISA Power Limited - India
- Salva Resources Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Anglo American - United Kingdom
- GMR Energy Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- Barasentosa Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Tata Chemicals Ltd - India
- Deloitte Consulting - India
- Parliament of New Zealand
- Intertek Mineral Services - Indonesia
- Power Finance Corporation Ltd., India
- Jindal Steel & Power Ltd - India
- Medco Energi Mining Internasional
- Bukit Baiduri Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- IEA Clean Coal Centre - UK
- Directorate General of MIneral and Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Makarim & Taira - Indonesia
- The University of Queensland
- San Jose City I Power Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- The State Trading Corporation of India Ltd
- European Bulk Services B.V. - Netherlands
- Uttam Galva Steels Limited - India
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- Chamber of Mines of South Africa
- Bhoruka Overseas - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Petron Corporation, Philippines
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- Eastern Coal Council - USA
- Semirara Mining Corp, Philippines
- Planning Commission, India
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Renaissance Capital - South Africa
- Thiess Contractors Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Oldendorff Carriers - Singapore
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- Sakthi Sugars Limited - India
- Goldman Sachs - Singapore
- Directorate Of Revenue Intelligence - India
- Orica Australia Pty. Ltd.
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Bangladesh Power Developement Board
- Electricity Generating Authority of Thailand
- Jorong Barutama Greston.PT - Indonesia
- The Treasury - Australian Government
- Ceylon Electricity Board - Sri Lanka
- Baramulti Group, Indonesia
- Indonesian Coal Mining Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- McConnell Dowell - Australia
- Cement Manufacturers Association - India
- OPG Power Generation Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- Minerals Council of Australia
- Mintek Dendrill Indonesia
- Metalloyd Limited - United Kingdom
- Coal and Oil Company - UAE
- Banpu Public Company Limited - Thailand
- Attock Cement Pakistan Limited
- Vizag Seaport Private Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- CIMB Investment Bank - Malaysia
- Bharathi Cement Corporation - India
- Toyota Tsusho Corporation, Japan
- Kaltim Prima Coal - Indonesia
- Jaiprakash Power Ventures ltd
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Sidhee Cement - India
- Sical Logistics Limited - India
- London Commodity Brokers - England
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- PTC India Limited - India
- Riau Bara Harum - Indonesia
- SMC Global Power, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Aboitiz Power Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Australian Coal Association
- Bayan Resources Tbk. - Indonesia
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- Ambuja Cements Ltd - India
- Sarangani Energy Corporation, Philippines
- Economic Council, Georgia
- Asmin Koalindo Tuhup - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Vedanta Resources Plc - India
- Binh Thuan Hamico - Vietnam
- Bhushan Steel Limited - India
- Sojitz Corporation - Japan
- Neyveli Lignite Corporation Ltd, - India
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Standard Chartered Bank - UAE
- Miang Besar Coal Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Lanco Infratech Ltd - India
- Wilmar Investment Holdings
- MS Steel International - UAE
- Sree Jayajothi Cements Limited - India
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Star Paper Mills Limited - India
- Savvy Resources Ltd - HongKong
- Australian Commodity Traders Exchange
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
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