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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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Monday, 17 August 15
CFR SOUTH CHINA COAL SWAPS CONTINUE TO HEAD SOUTH
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery declined just US cents 40 (1.05%) per MT month over month.
A commodi ...
Sunday, 16 August 15
INDONESIA TO INDIA FREIGHT RATES ARE EXPECTED TO STEADY NEXT WEEK
COALspot.com: The BDI softened 12.08 per cent to 1055 points this week due to weakening of cape index which was fell 25 per cent week over week to ...
Friday, 14 August 15
FOB INDONESIA COAL SWAP SHOWING NO MOVEMENT THIS PAST WEEK
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 $ ...
Friday, 14 August 15
U.S. COAL PRODUCTION UP 2.9 PER CENT THIS WEEK
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 18.2 million shor ...
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 ...
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- Riau Bara Harum - Indonesia
- ICICI Bank Limited - India
- The University of Queensland
- Formosa Plastics Group - Taiwan
- India Bulls Power Limited - India
- Latin American Coal - Colombia
- Iligan Light & Power Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Marubeni Corporation - India
- Cigading International Bulk Terminal - Indonesia
- Standard Chartered Bank - UAE
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- The State Trading Corporation of India Ltd
- Kapuas Tunggal Persada - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Star Paper Mills Limited - India
- Central Electricity Authority - India
- Metalloyd Limited - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Kumho Petrochemical, South Korea
- Sakthi Sugars Limited - India
- Carbofer General Trading SA - India
- Africa Commodities Group - South Africa
- Economic Council, Georgia
- Pipit Mutiara Jaya. PT, Indonesia
- Eastern Energy - Thailand
- Borneo Indobara - Indonesia
- Ministry of Mines - Canada
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Dalmia Cement Bharat India
- Bhushan Steel Limited - India
- Chettinad Cement Corporation Ltd - India
- Planning Commission, India
- GMR Energy Limited - India
- Holcim Trading Pte Ltd - Singapore
- Energy Development Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Indian Oil Corporation Limited
- Posco Energy - South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Global Coal Blending Company Limited - Australia
- Simpson Spence & Young - Indonesia
- Port Waratah Coal Services - Australia
- PNOC Exploration Corporation - Philippines
- Vizag Seaport Private Limited - India
- Binh Thuan Hamico - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- Cement Manufacturers Association - India
- Singapore Mercantile Exchange
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- Attock Cement Pakistan Limited
- Merrill Lynch Commodities Europe
- Indonesian Coal Mining Association
- Bulk Trading Sa - Switzerland
- Coal and Oil Company - UAE
- Kalimantan Lumbung Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Karbindo Abesyapradhi - Indoneisa
- Antam Resourcindo - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parliament of New Zealand
- Manunggal Multi Energi - Indonesia
- Interocean Group of Companies - India
- Ministry of Finance - Indonesia
- VISA Power Limited - India
- Sical Logistics Limited - India
- Grasim Industreis Ltd - India
- Xindia Steels Limited - India
- Tata Chemicals Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Minerals Council of Australia
- Maharashtra Electricity Regulatory Commission - India
- Sindya Power Generating Company Private Ltd
- Australian Coal Association
- Central Java Power - Indonesia
- Price Waterhouse Coopers - Russia
- LBH Netherlands Bv - Netherlands
- Ministry of Transport, Egypt
- Leighton Contractors Pty Ltd - Australia
- Globalindo Alam Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Chamber of Mines of South Africa
- Sarangani Energy Corporation, Philippines
- Meralco Power Generation, Philippines
- Coalindo Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GN Power Mariveles Coal Plant, Philippines
- Malabar Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- PTC India Limited - India
- Independent Power Producers Association of India
- Power Finance Corporation Ltd., India
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- Orica Australia Pty. Ltd.
- Uttam Galva Steels Limited - India
- White Energy Company Limited
- Orica Mining Services - Indonesia
- Wood Mackenzie - Singapore
- Videocon Industries ltd - India
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- Semirara Mining and Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Global Business Power Corporation, Philippines
- Gujarat Sidhee Cement - India
- GAC Shipping (India) Pvt Ltd
- Kaltim Prima Coal - Indonesia
- Edison Trading Spa - Italy
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Electricity Generating Authority of Thailand
- Georgia Ports Authority, United States
- Intertek Mineral Services - Indonesia
- Australian Commodity Traders Exchange
- Madhucon Powers Ltd - India
- Parry Sugars Refinery, India
- Timah Investasi Mineral - Indoneisa
- Jindal Steel & Power Ltd - India
- SMC Global Power, Philippines
- Pendopo Energi Batubara - Indonesia
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Kepco SPC Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Electricity Authority, New Zealand
- Jaiprakash Power Ventures ltd
- Aboitiz Power Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Bharathi Cement Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Kideco Jaya Agung - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Sojitz Corporation - Japan
- Goldman Sachs - Singapore
- Mercator Lines Limited - India
- Gujarat Mineral Development Corp Ltd - India
- New Zealand Coal & Carbon
- Petrochimia International Co. Ltd.- Taiwan
- European Bulk Services B.V. - Netherlands
- Banpu Public Company Limited - Thailand
- Tamil Nadu electricity Board
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- OPG Power Generation Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Oldendorff Carriers - Singapore
- Heidelberg Cement - Germany
- Sree Jayajothi Cements Limited - India
- Aditya Birla Group - India
- Vedanta Resources Plc - India
- Bukit Makmur.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bangladesh Power Developement Board
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Rio Tinto Coal - Australia
- CIMB Investment Bank - Malaysia
- IHS Mccloskey Coal Group - USA
- Krishnapatnam Port Company Ltd. - India
- Global Green Power PLC Corporation, Philippines
- Mjunction Services Limited - India
- MS Steel International - UAE
- Makarim & Taira - Indonesia
- GVK Power & Infra Limited - India
- SMG Consultants - Indonesia
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement PLC, Thailand
- Baramulti Group, Indonesia
- Larsen & Toubro Limited - India
- Indika Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- London Commodity Brokers - England
- Deloitte Consulting - India
- The Treasury - Australian Government
- Mercuria Energy - Indonesia
- CNBM International Corporation - China
- Trasteel International SA, Italy
- Therma Luzon, Inc, Philippines
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- Bhatia International Limited - India
- Medco Energi Mining Internasional
- Commonwealth Bank - Australia
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- Thiess Contractors Indonesia
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thai Mozambique Logistica
- Eastern Coal Council - USA
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Romanian Commodities Exchange
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