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Friday, 28 August 15
DRY BULK SHIP OWNER OPTIMISTIC ABOUT FUTURE PROSPECTS OF THE MARKET: NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Dry bulk ship owner Golden Ocean appeared optimistic on the long term prospects of the dry bulk market, mainly thanks to an expected resolution of the oversupply problems of the market. The owner added in its second quarter report that the average spot rates so far in the third quarter are higher than the rates in the first half of 2015, which means that the company’s revenues are expected to improve compared to the two previous quarters. Golden Ocean noted that following two very weak quarters, the third quarter started with more optimism, in particular, for the Capesize segment. With a spot market close to $20,000 per day it was questionable whether it was a structurally damaged market balance due to oversupply. “Then a three step devaluation by the Chinese Central Bank and a very nervous Chinese stock market removed all signs of optimism over a fortnight. With falling commodity prices and growing uncertainty in general, activity among dry bulk charterers is low at present. Short term this could be painful for owners of dry bulk assets, but in a longer term perspective the supply side should repair itself faster than previously anticipated”, Golden Ocean said.
In any case, according to the shipowner, the dry bulk spot market in the second quarter of 2015 did not give owners of dry bulk vessels any relief. “Rates ended up more or less at similar levels as in the pervious quarter and with limited volatility. According to the Baltic Exchange, average earnings for the Supramax segment were $6,766 per day compared to $6,434 per day in the previous quarter and $8,982 per day in the same quarter last year. Capesize vessels were again facing the lowest earnings with an average of $4,600 per day against $4,582 per day the previous quarter and $11,901 per day in the same quarter last year. Panamaxes earned on average $5,183 per day compared to $4,815 during the first quarter and $6,304 in the same quarter in 2014″.
FLEET SUPPLY
According to Golden Ocean though, the low utilization of the dry bulk fleet the first six months of the year has been due to demand issues rather than increased supply. “Actual deliveries for the first six months amounted to 110 Handysize vessels, 159 Handymaxes/Supramaxes, 88 Panamaxes/Kamsarmaxes and 57 Capesize vessels. During the first half of 2015 less than 27 mdwt were delivered. Even though the delivery rate picked up slightly during the month of July it is unlikely that the delivery ratio will exceed 65 per cent of the official order book this year. At the same time scrapping prior the monsoon season in June/July was beating most analysts’ expectations. For the entire sector above 10,000dwt, 300 vessels have been scrapped. The net effect of this is that after seven months into the year there is still zero net fleet growth for Handysize and Capesize”, said Golden Ocean.
The ship owner added that “historically, limited number of vessels will be delivered during the fourth quarter and in spite of fewer removals due to a combination of improved spot market and lower scrap prices, net fleet growth in 2015 will most likely end up at less than 3 per cent of additional capacity. In aggregate the total order book to fleet ratio fell below 18 per cent at the end of the second quarter, which marks the lowest level since 2003. Still many analysts believe that the official order book is bigger than reality. The positive trend on the supply side is definitely needed due to softer demand for dry bulk commodities”.
DRY BULK DEMAND
In terms of demand, Golden Ocean said in its report that “we witnessed a slight improvement in total demand in the second quarter of the year compared to the previous slow quarter. Measured in tonne miles demand for dry bulk commodities grew by one per cent compared to first quarter, but still one per cent lower than same quarter last year. Uncertainty and conflicting information from the most important country for dry bulk transportation is still making the headlines. The devaluation of the renminbi by the Chinese Central Bank took many by surprise. It is not expected that this will have a significant impact on import levels. Compared to the average exchange rate in January this year, the currency is trading 4 per cent lower while the average spot price for iron ore is 15 per cent lower than the January average price. Chinese steel consumption (observed) was 4.3 per cent lower in the second quarter compared to the same quarter last year, but increased by 3.5 per cent compared to the previous quarter. Chinese iron ore imports for the first half the year ended at 453 million mt, followed by a strong 86 million mt in July. This is 15 per cent up from previous month and the highest monthly import figure seen in 2015. It is interesting to note that iron ore inventories remain at relatively low levels and almost 30 million mt lower than same time last year. Australia and Brazil continue taking market share from marginal producers and are up 30 million and 10 million tons, respectively, in the first seven months of 2015. New capacity from both countries is expected to be made available in the coming months represented by Roy Hill in Australia and new production from Vale. Coal imports to China continue to be the most negative contributor to dry bulk demand and are 34 per cent lower year-on-year for the first seven months of 2015. July showed a similar uptick in imports as for iron ore and for the last few weeks Chinas southwestern regions received less rain than usual. As a consequence hydro power production in July fell for the first time since October 2013. Given that China imports only six per cent of the coal it consumes, the sensitivity and uncertainty is substantial. Limited new hydro power capacity will be introduced over the next five years. India’s growth in coal imports is steady, but at a slower pace last two months. In the first half of 2015, the country imported 120 million mt which is almost 30 million mt more than the same period previous year”, Golden Ocean noted.
Ship prices
The soft freight market continued to put downward pressure on asset values for all vessel classes during the second quarter. According to industry sources, prices fell by 7.5 percent to 12.5 percent depending on the country of construction. Asset prices have reacted positively so far in third quarter to the improved spot market freight environment and most analysts are of the opinion that the industry has seen the bottom in this cycle”, the shipowner concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Friday, 04 September 15
GOVERNORS WILL HAVE THE POWER TO REVOKE MINERS' PERMITS: ENERGY MINISTRY - JG
Starting Oct. 1, Indonesia's governors will lawfully become "executors" in revoking the licenses of miners that fail to secure a &quo ...
Thursday, 03 September 15
MINISTRY OF ENERGY AND MINERAL RESOURCES OF INDONESIA TO REVISE HBA METHODOLOGY
COALspot.com: Ministry of Energy and Mineral Resources (ESDM) in process to revise Indonesian Coal Price Reference (HBA) and expected to complete b ...
Thursday, 03 September 15
THE CHINESE STOCK MARKET AND THE CHINESE ECONOMY CONTINUE TO SUBSTANTIALLY AFFECT TRADING - INTERMODAL
The last week of the summer season saw the BDI dipping further on the back of another significant drop in rates for Capes, which brought the market ...
Wednesday, 02 September 15
PORT OF NEWCASTLE SHIPPED 13.46 MMT OF COAL IN JULY; UP 0.66 PER CENT M-O-M
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $1.224 billi ...
Wednesday, 02 September 15
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
In the beginning of the summer period SnP activity was firm with numerous buyers, coming mainly from Greece and the Far East, inspecting ships and ...
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- White Energy Company Limited
- Aboitiz Power Corporation - Philippines
- Thai Mozambique Logistica
- Sojitz Corporation - Japan
- Energy Development Corp, Philippines
- Parliament of New Zealand
- Commonwealth Bank - Australia
- Indian Oil Corporation Limited
- Bhushan Steel Limited - India
- Global Business Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Rio Tinto Coal - Australia
- Romanian Commodities Exchange
- Merrill Lynch Commodities Europe
- Alfred C Toepfer International GmbH - Germany
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- New Zealand Coal & Carbon
- Maharashtra Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Cement Manufacturers Association - India
- Kideco Jaya Agung - Indonesia
- Anglo American - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kartika Selabumi Mining - Indonesia
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- Altura Mining Limited, Indonesia
- IHS Mccloskey Coal Group - USA
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Transport, Egypt
- Planning Commission, India
- Jaiprakash Power Ventures ltd
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- Edison Trading Spa - Italy
- Baramulti Group, Indonesia
- Coalindo Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Savvy Resources Ltd - HongKong
- Central Java Power - Indonesia
- Malabar Cements Ltd - India
- Thiess Contractors Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PowerSource Philippines DevCo
- Eastern Energy - Thailand
- London Commodity Brokers - England
- Aditya Birla Group - India
- Agrawal Coal Company - India
- Ceylon Electricity Board - Sri Lanka
- GN Power Mariveles Coal Plant, Philippines
- Price Waterhouse Coopers - Russia
- Directorate General of MIneral and Coal - Indonesia
- Orica Australia Pty. Ltd.
- OPG Power Generation Pvt Ltd - India
- Indonesian Coal Mining Association
- Bhoruka Overseas - Indonesia
- The Treasury - Australian Government
- McConnell Dowell - Australia
- Chettinad Cement Corporation Ltd - India
- Mintek Dendrill Indonesia
- Metalloyd Limited - United Kingdom
- Heidelberg Cement - Germany
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- SMG Consultants - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Xindia Steels Limited - India
- Goldman Sachs - Singapore
- Grasim Industreis Ltd - India
- Indo Tambangraya Megah - Indonesia
- Siam City Cement - Thailand
- Kobexindo Tractors - Indoneisa
- Oldendorff Carriers - Singapore
- CNBM International Corporation - China
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Videocon Industries ltd - India
- Semirara Mining and Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Kalimantan Lumbung Energi - Indonesia
- Australian Coal Association
- Minerals Council of Australia
- VISA Power Limited - India
- LBH Netherlands Bv - Netherlands
- Mercator Lines Limited - India
- Medco Energi Mining Internasional
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- TeaM Sual Corporation - Philippines
- Ambuja Cements Ltd - India
- Singapore Mercantile Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- Parry Sugars Refinery, India
- European Bulk Services B.V. - Netherlands
- South Luzon Thermal Energy Corporation
- Straits Asia Resources Limited - Singapore
- Ministry of Mines - Canada
- Holcim Trading Pte Ltd - Singapore
- Manunggal Multi Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Global Green Power PLC Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- CIMB Investment Bank - Malaysia
- PetroVietnam Power Coal Import and Supply Company
- Chamber of Mines of South Africa
- Latin American Coal - Colombia
- Riau Bara Harum - Indonesia
- Semirara Mining Corp, Philippines
- Independent Power Producers Association of India
- Renaissance Capital - South Africa
- Bulk Trading Sa - Switzerland
- MS Steel International - UAE
- Power Finance Corporation Ltd., India
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- Mjunction Services Limited - India
- Meenaskhi Energy Private Limited - India
- Energy Link Ltd, New Zealand
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Bayan Resources Tbk. - Indonesia
- Posco Energy - South Korea
- Georgia Ports Authority, United States
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Samtan Co., Ltd - South Korea
- Timah Investasi Mineral - Indoneisa
- ICICI Bank Limited - India
- Antam Resourcindo - Indonesia
- Gujarat Sidhee Cement - India
- Sarangani Energy Corporation, Philippines
- Uttam Galva Steels Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Therma Luzon, Inc, Philippines
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Interocean Group of Companies - India
- Carbofer General Trading SA - India
- Jindal Steel & Power Ltd - India
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- Indika Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Indian Energy Exchange, India
- Deloitte Consulting - India
- Bharathi Cement Corporation - India
- Orica Mining Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bukit Baiduri Energy - Indonesia
- Port Waratah Coal Services - Australia
- IEA Clean Coal Centre - UK
- Iligan Light & Power Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Asmin Koalindo Tuhup - Indonesia
- ASAPP Information Group - India
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- Sindya Power Generating Company Private Ltd
- The University of Queensland
- Lanco Infratech Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Attock Cement Pakistan Limited
- SMC Global Power, Philippines
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Dalmia Cement Bharat India
- Vedanta Resources Plc - India
- Ministry of Finance - Indonesia
- San Jose City I Power Corp, Philippines
- Star Paper Mills Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- Wilmar Investment Holdings
- Simpson Spence & Young - Indonesia
- Petron Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- India Bulls Power Limited - India
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Economic Council, Georgia
- Intertek Mineral Services - Indonesia
- Coal and Oil Company - UAE
- Borneo Indobara - Indonesia
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- Globalindo Alam Lestari - Indonesia
- Standard Chartered Bank - UAE
- Eastern Coal Council - USA
- Binh Thuan Hamico - Vietnam
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