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Wednesday, 24 February 16
THIRTEEN - NOT ALWAYS AN UNLUCKY NUMBER? - CLARKSONS
 Back in early 1999 the price of a 5 year old Panamax bulkcarrier dipped to $13.5m, and ever since analysts have hailed purchase decisions made at that time as some of the most lucrative shipping deals ever seen. Today, with the price back at $13m, perhaps it’s a good time to reflect on how successful investors were back in 1999 and whether there are similar opportunities once again.
What Was The Deal?
The graph shows for each year since 1990 the return that would have been generated by the purchase of a 5 year old Panamax bulkcarrier at the start of the year, the subsequent operation for ten years at the prevailing one year timecharter rate and then the sale of the unit at the end of that period as a 15 year old (for units purchased in 2007 and later, disposal at start 2016 was assumed). At the end of 1999 investors could pick up a 5 year old Panamax bulker for $14m. Trading that vessel at the start year one year timecharter rate for 10 years would have generated estimated earnings of $66.5m (after opex), and then as a 15 year old unit in 2009 the vessel could have been sold for $12.5m. That’s a small loss of $1.5m on the asset but still a total return of $65m, and an impressive internal rate of return (IRR) of 26%.
Playing Snap
A few years later, 5 year old Panamax bulkcarrier purchases did perhaps even better. Buying a 5 year old in 2002, once again at $14m, trading at the timecharter rate and selling as a 15 year old would have generated total returns of $73.2m and an IRR of 41%, whilst the equivalent project in 2003 would have generated $66.1m and an IRR of 44%. These vessels would have generated boom earnings earlier in the project period, subject to a heavier weighting in terms of the internal rate of return calculation.
Not Always A Good Hand
However, not all investors are so lucky. In this example, 5 year old ships purchased since 2008 (and sold this year, so admittedly with less time to hit upon a period of boom earnings) generated negative returns, and those purchased pre-1995 an average IRR of 7%. Buyers in 2008 would have lost a whopping $82.1m on the asset. Nevertheless, there was clearly a golden period; in the years 1998-2006 investors would have achieved an IRR ranging between 20% and 44%.
Unlucky (Or Lucky) 13?
So for those who have had the stomach to buy in at difficult times, there have been more than ample rewards. Today the price of a 5 year old Panamax is back at $13m. Dry bulk fundamentals, particularly on the demand side with the Chinese economy maturing, don’t look helpful at all (see SIW 1207), but with the 5 year old price at almost half that of a newbuild, who really knows what the longer-term opportunity might be?
Fortune favours the brave, but they also say that fools rush in. The outlook seems scary but investors might also have half an eye on their peers who invested at low points in the price cycle in the past. That’s the beauty of volatile and cyclical sectors, but it’s tricky food for thought for shipping investors. Are they willing to party like it’s 1999? Have a nice day.
Source: Clarksons
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Tuesday, 15 March 16
PORT OF NEWCASTLE SHIPPED 12.78 MMT OF COAL IN FEBRUARY 2016
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port has shipped AU$1,110.5 mi ...
Tuesday, 15 March 16
ADARO ENERGY LOWERED ITS COAL CASH COST BY 16% TO US$ 27.98 PER TONE IN 2015
Difficult Coal Market Condition Persists in 2015, Adaro Lowers Costs, Reduces Capital Spending and Maintains Solid Liquidity.
PT Adaro E ...
Monday, 14 March 16
THE CS 50 INDEX ROSE $0.16 OR, 0.41% TO $38.82 A TON
COALspot.com: Average 5000 GAR coal index of Indonesian origin rose 0.41 percent week over week to averaging $38.82 per ton on this past Friday, ac ...
Monday, 14 March 16
THE BALTIC EXCHANGE CONTINUED TO ROSE THIS PAST WEEK
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities continued to rise this week helped by higher rates for pa ...
Saturday, 12 March 16
PLN, COAL COMPANIES IN TALKS ABOUT PRICES - THE JAKARTA POST
Following a study that predicted that Indonesia would struggle to provide coal for its power stations in the near future, the government will facil ...
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Showing 2521 to 2525 news of total 6871 |
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- Central Java Power - Indonesia
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Standard Chartered Bank - UAE
- Thai Mozambique Logistica
- Port Waratah Coal Services - Australia
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Posco Energy - South Korea
- Sree Jayajothi Cements Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jindal Steel & Power Ltd - India
- Toyota Tsusho Corporation, Japan
- Wilmar Investment Holdings
- Kumho Petrochemical, South Korea
- Indian Energy Exchange, India
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Finance - Indonesia
- Oldendorff Carriers - Singapore
- Vedanta Resources Plc - India
- Kalimantan Lumbung Energi - Indonesia
- Coastal Gujarat Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- India Bulls Power Limited - India
- Iligan Light & Power Inc, Philippines
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Mercator Lines Limited - India
- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- European Bulk Services B.V. - Netherlands
- Siam City Cement - Thailand
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- Power Finance Corporation Ltd., India
- Global Green Power PLC Corporation, Philippines
- Edison Trading Spa - Italy
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- Uttam Galva Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Parliament of New Zealand
- Larsen & Toubro Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Directorate Of Revenue Intelligence - India
- Globalindo Alam Lestari - Indonesia
- Xindia Steels Limited - India
- McConnell Dowell - Australia
- Kartika Selabumi Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bhatia International Limited - India
- Bayan Resources Tbk. - Indonesia
- Star Paper Mills Limited - India
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Maheswari Brothers Coal Limited - India
- Grasim Industreis Ltd - India
- Indika Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Sojitz Corporation - Japan
- Chettinad Cement Corporation Ltd - India
- Interocean Group of Companies - India
- Price Waterhouse Coopers - Russia
- Jaiprakash Power Ventures ltd
- Trasteel International SA, Italy
- Kaltim Prima Coal - Indonesia
- Economic Council, Georgia
- Altura Mining Limited, Indonesia
- Siam City Cement PLC, Thailand
- Formosa Plastics Group - Taiwan
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- CIMB Investment Bank - Malaysia
- Dalmia Cement Bharat India
- Baramulti Group, Indonesia
- Riau Bara Harum - Indonesia
- Leighton Contractors Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Tamil Nadu electricity Board
- Kobexindo Tractors - Indoneisa
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Sical Logistics Limited - India
- New Zealand Coal & Carbon
- The University of Queensland
- VISA Power Limited - India
- PTC India Limited - India
- SN Aboitiz Power Inc, Philippines
- Wood Mackenzie - Singapore
- OPG Power Generation Pvt Ltd - India
- White Energy Company Limited
- Independent Power Producers Association of India
- Simpson Spence & Young - Indonesia
- Cement Manufacturers Association - India
- Gujarat Sidhee Cement - India
- AsiaOL BioFuels Corp., Philippines
- Goldman Sachs - Singapore
- Bukit Makmur.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Makarim & Taira - Indonesia
- International Coal Ventures Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Indian Oil Corporation Limited
- Romanian Commodities Exchange
- Sinarmas Energy and Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Bangladesh Power Developement Board
- GN Power Mariveles Coal Plant, Philippines
- Indonesian Coal Mining Association
- Petron Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Carbofer General Trading SA - India
- Intertek Mineral Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Australian Coal Association
- Planning Commission, India
- Africa Commodities Group - South Africa
- SMC Global Power, Philippines
- Therma Luzon, Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- Energy Link Ltd, New Zealand
- Semirara Mining Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Ministry of Transport, Egypt
- Essar Steel Hazira Ltd - India
- Kepco SPC Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Malabar Cements Ltd - India
- Georgia Ports Authority, United States
- Lanco Infratech Ltd - India
- GVK Power & Infra Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bharathi Cement Corporation - India
- Minerals Council of Australia
- Salva Resources Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Marubeni Corporation - India
- Thiess Contractors Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Attock Cement Pakistan Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rio Tinto Coal - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kideco Jaya Agung - Indonesia
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Anglo American - United Kingdom
- Aboitiz Power Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- Bulk Trading Sa - Switzerland
- Metalloyd Limited - United Kingdom
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- Chamber of Mines of South Africa
- Deloitte Consulting - India
- Ambuja Cements Ltd - India
- London Commodity Brokers - England
- Parry Sugars Refinery, India
- Sindya Power Generating Company Private Ltd
- TeaM Sual Corporation - Philippines
- GMR Energy Limited - India
- Aditya Birla Group - India
- Ceylon Electricity Board - Sri Lanka
- Mintek Dendrill Indonesia
- Central Electricity Authority - India
- The State Trading Corporation of India Ltd
- CNBM International Corporation - China
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- The Treasury - Australian Government
- San Jose City I Power Corp, Philippines
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Orica Mining Services - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Australia Pty. Ltd.
- Australian Commodity Traders Exchange
- Coal and Oil Company - UAE
- Miang Besar Coal Terminal - Indonesia
- Indogreen Group - Indonesia
- Latin American Coal - Colombia
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- PowerSource Philippines DevCo
- Global Business Power Corporation, Philippines
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Videocon Industries ltd - India
- Eastern Energy - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Commonwealth Bank - Australia
- Jorong Barutama Greston.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Borneo Indobara - Indonesia
- Merrill Lynch Commodities Europe
- Heidelberg Cement - Germany
- Medco Energi Mining Internasional
- Ind-Barath Power Infra Limited - India
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
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