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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, 28 August 15
COAL PRODUCTION IN THE U.S. FOR THE WEEK ENDING AUGUST 22 ROSE FOR THE THIRD STRAIGHT WEEK
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 18.5 million shor ...
Friday, 28 August 15
BANPU STRENGTHENS GROWTH PLAN
Coal Business: Asia-Pacific Synergies Increase Competitiveness for Premium Export Market.
Banpu Public Company Limited (BANPU) strengthens its ...
Thursday, 27 August 15
RATES FOR CAPES REMAINED ON A FREE FALL LAST WEEK - INTERMODAL
COALspot.com: Keeping everyone on their toes with the volatility seen in August, the Dry Bulk market undoubtedly remains a steady provider of chall ...
Wednesday, 26 August 15
MARKET INSIGHT - STRATOS TINIAKOS
It’s always interesting to comment on the market when big economies around the world are facing troubling times. Following the collapse of th ...
Wednesday, 26 August 15
2Q'16 FOB INDONESIA COAL SWAP FALLS NEARLY 4.76 PER CENT M-O-M
COALspot.com: Indonesian coal swap for delivery 4Q 2015 declined month on month and week over week.
The 4Q swap was declined $ 2.20 (-5.13%) p ...
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- Directorate General of MIneral and Coal - Indonesia
- Central Electricity Authority - India
- Maharashtra Electricity Regulatory Commission - India
- VISA Power Limited - India
- Indika Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Savvy Resources Ltd - HongKong
- Wilmar Investment Holdings
- Aditya Birla Group - India
- Pipit Mutiara Jaya. PT, Indonesia
- Posco Energy - South Korea
- Meenaskhi Energy Private Limited - India
- Indian Energy Exchange, India
- Salva Resources Pvt Ltd - India
- Baramulti Group, Indonesia
- Bhoruka Overseas - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- McConnell Dowell - Australia
- Sinarmas Energy and Mining - Indonesia
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Neyveli Lignite Corporation Ltd, - India
- Coastal Gujarat Power Limited - India
- Siam City Cement - Thailand
- Thiess Contractors Indonesia
- Mintek Dendrill Indonesia
- Mercator Lines Limited - India
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Africa Commodities Group - South Africa
- Heidelberg Cement - Germany
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Chettinad Cement Corporation Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Coalindo Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Semirara Mining Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Madhucon Powers Ltd - India
- Energy Link Ltd, New Zealand
- Trasteel International SA, Italy
- Parliament of New Zealand
- PetroVietnam Power Coal Import and Supply Company
- IEA Clean Coal Centre - UK
- Bahari Cakrawala Sebuku - Indonesia
- Formosa Plastics Group - Taiwan
- Makarim & Taira - Indonesia
- Billiton Holdings Pty Ltd - Australia
- GN Power Mariveles Coal Plant, Philippines
- Edison Trading Spa - Italy
- Meralco Power Generation, Philippines
- Barasentosa Lestari - Indonesia
- Australian Commodity Traders Exchange
- Parry Sugars Refinery, India
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Straits Asia Resources Limited - Singapore
- Globalindo Alam Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- Bangladesh Power Developement Board
- Indogreen Group - Indonesia
- ASAPP Information Group - India
- Star Paper Mills Limited - India
- Sojitz Corporation - Japan
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Metalloyd Limited - United Kingdom
- Kobexindo Tractors - Indoneisa
- CNBM International Corporation - China
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Bharathi Cement Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- Bhushan Steel Limited - India
- The University of Queensland
- ICICI Bank Limited - India
- Manunggal Multi Energi - Indonesia
- Attock Cement Pakistan Limited
- Grasim Industreis Ltd - India
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Economic Council, Georgia
- Xindia Steels Limited - India
- Wood Mackenzie - Singapore
- SMG Consultants - Indonesia
- PTC India Limited - India
- Indonesian Coal Mining Association
- Carbofer General Trading SA - India
- Ambuja Cements Ltd - India
- SMC Global Power, Philippines
- International Coal Ventures Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Independent Power Producers Association of India
- Iligan Light & Power Inc, Philippines
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- MS Steel International - UAE
- Standard Chartered Bank - UAE
- Oldendorff Carriers - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- GAC Shipping (India) Pvt Ltd
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- South Luzon Thermal Energy Corporation
- Port Waratah Coal Services - Australia
- Leighton Contractors Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- Lanco Infratech Ltd - India
- Ministry of Transport, Egypt
- Ministry of Mines - Canada
- Intertek Mineral Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Finance - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Agrawal Coal Company - India
- Kapuas Tunggal Persada - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Simpson Spence & Young - Indonesia
- Medco Energi Mining Internasional
- Thai Mozambique Logistica
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Deloitte Consulting - India
- Bukit Makmur.PT - Indonesia
- Orica Australia Pty. Ltd.
- Renaissance Capital - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jaiprakash Power Ventures ltd
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Bhatia International Limited - India
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- Karaikal Port Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Australian Coal Association
- Sarangani Energy Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Gujarat Sidhee Cement - India
- Riau Bara Harum - Indonesia
- Sindya Power Generating Company Private Ltd
- Rashtriya Ispat Nigam Limited - India
- Altura Mining Limited, Indonesia
- Rio Tinto Coal - Australia
- Global Business Power Corporation, Philippines
- Mercuria Energy - Indonesia
- Dalmia Cement Bharat India
- India Bulls Power Limited - India
- Chamber of Mines of South Africa
- Minerals Council of Australia
- Bulk Trading Sa - Switzerland
- Kaltim Prima Coal - Indonesia
- Coal and Oil Company - UAE
- Tamil Nadu electricity Board
- Videocon Industries ltd - India
- Romanian Commodities Exchange
- Binh Thuan Hamico - Vietnam
- Orica Mining Services - Indonesia
- Therma Luzon, Inc, Philippines
- London Commodity Brokers - England
- Bukit Baiduri Energy - Indonesia
- Indian Oil Corporation Limited
- Maheswari Brothers Coal Limited - India
- Vizag Seaport Private Limited - India
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Indo Tambangraya Megah - Indonesia
- Kartika Selabumi Mining - Indonesia
- Energy Development Corp, Philippines
- Petron Corporation, Philippines
- Commonwealth Bank - Australia
- Antam Resourcindo - Indonesia
- Cement Manufacturers Association - India
- Mjunction Services Limited - India
- Jindal Steel & Power Ltd - India
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- GMR Energy Limited - India
- New Zealand Coal & Carbon
- White Energy Company Limited
- Krishnapatnam Port Company Ltd. - India
- Malabar Cements Ltd - India
- Georgia Ports Authority, United States
- San Jose City I Power Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Central Java Power - Indonesia
- PNOC Exploration Corporation - Philippines
- Vedanta Resources Plc - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Anglo American - United Kingdom
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- Ind-Barath Power Infra Limited - India
- Siam City Cement PLC, Thailand
- PowerSource Philippines DevCo
- Pendopo Energi Batubara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Eastern Energy - Thailand
- Sakthi Sugars Limited - India
- Larsen & Toubro Limited - India
- Essar Steel Hazira Ltd - India
- Goldman Sachs - Singapore
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