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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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Tuesday, 25 August 15
INDONESIA MINERS' NPLS TO RISE FURTHER, BANK RISKS BUILD - FITCH
The NPLs of Indonesian mine and mine services companies are likely to rise further in the short term, says Fitch Ratings, after reaching multi-year ...
Tuesday, 25 August 15
MINER'S EARNINGS DROP ON FALLING COAL PRICES; Q2'16 FOB RICHARDS BAY COAL SWAP CLOSED AT $ 52.23 A TON
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$ ...
Monday, 24 August 15
FOB NEWCASTLE COAL SWAPS HIT FRESH LOW, DIPPING BELOW $42 A TON
COALspot.com: API 5 FOB Newcastle Coal swap for 4Q’ 2015 delivery down $ 2.20 per MT (-5.01%) month over month to US$ 41.70 per mt. The swap ...
Monday, 24 August 15
Q1'16 CFR SOUTH CHINA COAL SWAP CLOSED AT $ 48.65 PMT
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery declined just US$ 1.89 (3.74%) per MT month over month.
A commodity ...
Monday, 24 August 15
IS CHINA'S STEEL EXPORTS ENOUGH TO SUPPORT THE FREIGHT MARKET? - BIMCO
No, it’s not enough, you will need lower Chinese iron ore production too in order to keep growing imports of iron ore into China that will su ...
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- Samtan Co., Ltd - South Korea
- Independent Power Producers Association of India
- Oldendorff Carriers - Singapore
- Straits Asia Resources Limited - Singapore
- Kepco SPC Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Australian Commodity Traders Exchange
- Economic Council, Georgia
- VISA Power Limited - India
- Binh Thuan Hamico - Vietnam
- Metalloyd Limited - United Kingdom
- Marubeni Corporation - India
- Anglo American - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Petron Corporation, Philippines
- MS Steel International - UAE
- Eastern Coal Council - USA
- South Luzon Thermal Energy Corporation
- Carbofer General Trading SA - India
- Bahari Cakrawala Sebuku - Indonesia
- Riau Bara Harum - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- CNBM International Corporation - China
- Savvy Resources Ltd - HongKong
- Coalindo Energy - Indonesia
- European Bulk Services B.V. - Netherlands
- Kapuas Tunggal Persada - Indonesia
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Intertek Mineral Services - Indonesia
- Bhushan Steel Limited - India
- Formosa Plastics Group - Taiwan
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- AsiaOL BioFuels Corp., Philippines
- ASAPP Information Group - India
- GMR Energy Limited - India
- Gujarat Sidhee Cement - India
- San Jose City I Power Corp, Philippines
- Global Business Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- Deloitte Consulting - India
- Energy Link Ltd, New Zealand
- Essar Steel Hazira Ltd - India
- Sakthi Sugars Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Indo Tambangraya Megah - Indonesia
- Indonesian Coal Mining Association
- Offshore Bulk Terminal Pte Ltd, Singapore
- McConnell Dowell - Australia
- Barasentosa Lestari - Indonesia
- Mintek Dendrill Indonesia
- Price Waterhouse Coopers - Russia
- Bukit Makmur.PT - Indonesia
- Africa Commodities Group - South Africa
- Renaissance Capital - South Africa
- Maharashtra Electricity Regulatory Commission - India
- White Energy Company Limited
- Star Paper Mills Limited - India
- Grasim Industreis Ltd - India
- Ministry of Mines - Canada
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- Singapore Mercantile Exchange
- Borneo Indobara - Indonesia
- Wilmar Investment Holdings
- Krishnapatnam Port Company Ltd. - India
- OPG Power Generation Pvt Ltd - India
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- PowerSource Philippines DevCo
- Thai Mozambique Logistica
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- Siam City Cement - Thailand
- Globalindo Alam Lestari - Indonesia
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- Heidelberg Cement - Germany
- Parry Sugars Refinery, India
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- Sindya Power Generating Company Private Ltd
- Vizag Seaport Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Directorate Of Revenue Intelligence - India
- Indian Energy Exchange, India
- Cigading International Bulk Terminal - Indonesia
- Baramulti Group, Indonesia
- Medco Energi Mining Internasional
- Jorong Barutama Greston.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Energy Development Corp, Philippines
- Wood Mackenzie - Singapore
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Electricity Generating Authority of Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bharathi Cement Corporation - India
- SMG Consultants - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- IEA Clean Coal Centre - UK
- TeaM Sual Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- PNOC Exploration Corporation - Philippines
- Power Finance Corporation Ltd., India
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
- Aditya Birla Group - India
- Latin American Coal - Colombia
- Altura Mining Limited, Indonesia
- Orica Australia Pty. Ltd.
- PTC India Limited - India
- Mercator Lines Limited - India
- The Treasury - Australian Government
- Indogreen Group - Indonesia
- Sical Logistics Limited - India
- Dalmia Cement Bharat India
- Chettinad Cement Corporation Ltd - India
- Meralco Power Generation, Philippines
- Kideco Jaya Agung - Indonesia
- Bangladesh Power Developement Board
- Goldman Sachs - Singapore
- Interocean Group of Companies - India
- Planning Commission, India
- Antam Resourcindo - Indonesia
- Edison Trading Spa - Italy
- Semirara Mining Corp, Philippines
- Maheswari Brothers Coal Limited - India
- Thiess Contractors Indonesia
- Minerals Council of Australia
- Manunggal Multi Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Rio Tinto Coal - Australia
- Videocon Industries ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Jaiprakash Power Ventures ltd
- Petrochimia International Co. Ltd.- Taiwan
- Ceylon Electricity Board - Sri Lanka
- Tata Chemicals Ltd - India
- Ministry of Transport, Egypt
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Iligan Light & Power Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- The University of Queensland
- Malabar Cements Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Karaikal Port Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Directorate General of MIneral and Coal - Indonesia
- Australian Coal Association
- Aboitiz Power Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Sarangani Energy Corporation, Philippines
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- Commonwealth Bank - Australia
- Central Electricity Authority - India
- Xindia Steels Limited - India
- Parliament of New Zealand
- Ind-Barath Power Infra Limited - India
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- Bhatia International Limited - India
- Indika Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Mjunction Services Limited - India
- Sinarmas Energy and Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Kumho Petrochemical, South Korea
- Ambuja Cements Ltd - India
- Billiton Holdings Pty Ltd - Australia
- GVK Power & Infra Limited - India
- Kobexindo Tractors - Indoneisa
- India Bulls Power Limited - India
- Madhucon Powers Ltd - India
- SN Aboitiz Power Inc, Philippines
- Ministry of Finance - Indonesia
- Makarim & Taira - Indonesia
- Siam City Cement PLC, Thailand
- Coal and Oil Company - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Trasteel International SA, Italy
- Agrawal Coal Company - India
- Port Waratah Coal Services - Australia
- Rashtriya Ispat Nigam Limited - India
- New Zealand Coal & Carbon
- Pendopo Energi Batubara - Indonesia
- Central Java Power - Indonesia
- Kaltim Prima Coal - Indonesia
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- The State Trading Corporation of India Ltd
- Cement Manufacturers Association - India
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Vedanta Resources Plc - India
- Timah Investasi Mineral - Indoneisa
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