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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, 03 August 15
NEWCASTLE COAL SWAPS DECLINE FURTHER THIS PAST WEEK
COALspot.com: API 5 FOB Newcastle Coal swap for 4Q’ 2015 delivery down $ 1.92 per MT (-4.22%) month over month to US$ 43.58 per mt. The swap ...
Monday, 03 August 15
CFR SOUTH CHINA COAL SWAPS SLIDE THIS WEEK
COALspot.com: API 8 CFR South China Coal swap for 4Q’ 2015 delivery declined US$ 1.64 (3.14%) per MT month over month.
A commodity swap ...
Sunday, 02 August 15
CAPESIZE RATES PUSH BDI UPWARD
COALspot.com: The freight market was buoyant this week as BDI rose 4.14 pct to 1131 points. The cape index was also increased 16.50 pct 2209 points ...
Saturday, 01 August 15
DRY BULK MARKET KEEPS ITS MOMENTUM, AS OUTLOOK IMPROVES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Although conditions remain more than challenging, especially from an economic point of view (aka China’s stock worries), the dry bulk market ...
Friday, 31 July 15
CAPE'S PAPER MARKET REMAINS FIRM - INTERMODAL
COALspot.com: The positive sentiment that the Dry Bulk market has been enjoying as of the previous month, was carried through last week as well, bu ...
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- South Luzon Thermal Energy Corporation
- Romanian Commodities Exchange
- Kalimantan Lumbung Energi - Indonesia
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- Jaiprakash Power Ventures ltd
- McConnell Dowell - Australia
- Antam Resourcindo - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bhoruka Overseas - Indonesia
- Dalmia Cement Bharat India
- Directorate General of MIneral and Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- PowerSource Philippines DevCo
- Aditya Birla Group - India
- Bangladesh Power Developement Board
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- Samtan Co., Ltd - South Korea
- SMG Consultants - Indonesia
- Posco Energy - South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- Gujarat Mineral Development Corp Ltd - India
- Madhucon Powers Ltd - India
- Kaltim Prima Coal - Indonesia
- CNBM International Corporation - China
- Eastern Energy - Thailand
- Singapore Mercantile Exchange
- Oldendorff Carriers - Singapore
- London Commodity Brokers - England
- Commonwealth Bank - Australia
- Kartika Selabumi Mining - Indonesia
- Minerals Council of Australia
- Holcim Trading Pte Ltd - Singapore
- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- Malabar Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Wilmar Investment Holdings
- Chettinad Cement Corporation Ltd - India
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- Straits Asia Resources Limited - Singapore
- Bukit Makmur.PT - Indonesia
- Meralco Power Generation, Philippines
- Mjunction Services Limited - India
- Xindia Steels Limited - India
- Vedanta Resources Plc - India
- LBH Netherlands Bv - Netherlands
- White Energy Company Limited
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Lanco Infratech Ltd - India
- Binh Thuan Hamico - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Indian Oil Corporation Limited
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Merrill Lynch Commodities Europe
- GAC Shipping (India) Pvt Ltd
- Star Paper Mills Limited - India
- Aboitiz Power Corporation - Philippines
- MS Steel International - UAE
- Thiess Contractors Indonesia
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- VISA Power Limited - India
- Ministry of Mines - Canada
- Central Electricity Authority - India
- Edison Trading Spa - Italy
- Parry Sugars Refinery, India
- Barasentosa Lestari - Indonesia
- Mercuria Energy - Indonesia
- Medco Energi Mining Internasional
- Electricity Authority, New Zealand
- Billiton Holdings Pty Ltd - Australia
- Central Java Power - Indonesia
- Coalindo Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Grasim Industreis Ltd - India
- Riau Bara Harum - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Attock Cement Pakistan Limited
- Borneo Indobara - Indonesia
- Agrawal Coal Company - India
- Cigading International Bulk Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Indika Energy - Indonesia
- Marubeni Corporation - India
- CIMB Investment Bank - Malaysia
- Wood Mackenzie - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Carbofer General Trading SA - India
- Renaissance Capital - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indogreen Group - Indonesia
- Sree Jayajothi Cements Limited - India
- Parliament of New Zealand
- Siam City Cement PLC, Thailand
- The University of Queensland
- Makarim & Taira - Indonesia
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- Gujarat Sidhee Cement - India
- Bhatia International Limited - India
- IHS Mccloskey Coal Group - USA
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Global Coal Blending Company Limited - Australia
- Essar Steel Hazira Ltd - India
- Simpson Spence & Young - Indonesia
- Sical Logistics Limited - India
- Ministry of Finance - Indonesia
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Interocean Group of Companies - India
- TeaM Sual Corporation - Philippines
- Goldman Sachs - Singapore
- Deloitte Consulting - India
- Videocon Industries ltd - India
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Ind-Barath Power Infra Limited - India
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Maheswari Brothers Coal Limited - India
- Energy Link Ltd, New Zealand
- Africa Commodities Group - South Africa
- Directorate Of Revenue Intelligence - India
- Altura Mining Limited, Indonesia
- International Coal Ventures Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Latin American Coal - Colombia
- Alfred C Toepfer International GmbH - Germany
- Standard Chartered Bank - UAE
- Siam City Cement - Thailand
- European Bulk Services B.V. - Netherlands
- Toyota Tsusho Corporation, Japan
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- Anglo American - United Kingdom
- Eastern Coal Council - USA
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- SMC Global Power, Philippines
- Electricity Generating Authority of Thailand
- Vizag Seaport Private Limited - India
- Bharathi Cement Corporation - India
- Sojitz Corporation - Japan
- Ceylon Electricity Board - Sri Lanka
- Kepco SPC Power Corporation, Philippines
- Ambuja Cements Ltd - India
- New Zealand Coal & Carbon
- Indian Energy Exchange, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Independent Power Producers Association of India
- Trasteel International SA, Italy
- Orica Mining Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Maharashtra Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Ministry of Transport, Egypt
- Tamil Nadu electricity Board
- Australian Coal Association
- Kumho Petrochemical, South Korea
- Gujarat Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- IEA Clean Coal Centre - UK
- Baramulti Group, Indonesia
- Port Waratah Coal Services - Australia
- Bayan Resources Tbk. - Indonesia
- Mintek Dendrill Indonesia
- Petron Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- The Treasury - Australian Government
- San Jose City I Power Corp, Philippines
- Banpu Public Company Limited - Thailand
- Thai Mozambique Logistica
- Pendopo Energi Batubara - Indonesia
- Heidelberg Cement - Germany
- ASAPP Information Group - India
- Semirara Mining Corp, Philippines
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- Jorong Barutama Greston.PT - Indonesia
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- Asmin Koalindo Tuhup - Indonesia
- Australian Commodity Traders Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
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