We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
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
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Wednesday, 24 February 16
HOW IS THE FUEL MIX FOR U.S. ELECTRICITY GENERATION CHANGING? - EIA
In recent years, there have been changes in the mix of fuels used to generate electricity in the United States. Natural gas and renewable energy so ...
Wednesday, 24 February 16
PRIVATE EQUITY FUNDS LOOKING TO EXIT SHIPPING, MOST NOTABLY DRY BULK, AS OVERORDERING HAS RESULTED IN EXCESS TONNAGE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The injection of more than $13 billion in shipping from various private equity funds over the past few years has resulted in what many feared would ...
Monday, 22 February 16
4200 GAR COAL INDEX SETTLES AT $27.02, DOWN 0.07% FROM LAST WEEK
COALspot.com: Average 5000 GAR coal index of Indonesian origin decline 0.17 percent week over week to averaging $38.89 per ton on this past Friday, ...
Monday, 22 February 16
FREIGHT MARKETS PICKED UP SLIGHTLY THIS PAST WEEK
COALspot.com: The freight markets picked up slightly this past week.
The Baltic Dry Index (BDI) of dry-bulk shipping freights, a measure of gl ...
Friday, 19 February 16
INDONESIAN HBA HITS A NEW LOWS BELOW $51 A TON AS OVERSUPPLY, LOW DEMAND WOES PERSIST
COALspot.com: Low coal demand and excess supplies sent Indonesian benchmark coal price further deep in February 2016. HBA has slumped second time t ...
|
|
|
Showing 2551 to 2555 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- IHS Mccloskey Coal Group - USA
- Kideco Jaya Agung - Indonesia
- Aditya Birla Group - India
- Salva Resources Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- The University of Queensland
- Krishnapatnam Port Company Ltd. - India
- Billiton Holdings Pty Ltd - Australia
- Mercuria Energy - Indonesia
- Georgia Ports Authority, United States
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- ICICI Bank Limited - India
- Sree Jayajothi Cements Limited - India
- Kartika Selabumi Mining - Indonesia
- Singapore Mercantile Exchange
- Jindal Steel & Power Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Meralco Power Generation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Thai Mozambique Logistica
- ASAPP Information Group - India
- Bharathi Cement Corporation - India
- Electricity Generating Authority of Thailand
- Sindya Power Generating Company Private Ltd
- Grasim Industreis Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Thiess Contractors Indonesia
- Iligan Light & Power Inc, Philippines
- Mjunction Services Limited - India
- TeaM Sual Corporation - Philippines
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Mintek Dendrill Indonesia
- Bhatia International Limited - India
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining Corp, Philippines
- Posco Energy - South Korea
- Lanco Infratech Ltd - India
- Port Waratah Coal Services - Australia
- Medco Energi Mining Internasional
- VISA Power Limited - India
- Wood Mackenzie - Singapore
- Xindia Steels Limited - India
- Indika Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Kalimantan Lumbung Energi - Indonesia
- Ambuja Cements Ltd - India
- Minerals Council of Australia
- Latin American Coal - Colombia
- Indogreen Group - Indonesia
- Directorate Of Revenue Intelligence - India
- Orica Australia Pty. Ltd.
- Bhushan Steel Limited - India
- Standard Chartered Bank - UAE
- Antam Resourcindo - Indonesia
- The State Trading Corporation of India Ltd
- Indo Tambangraya Megah - Indonesia
- Therma Luzon, Inc, Philippines
- Marubeni Corporation - India
- Bangladesh Power Developement Board
- Banpu Public Company Limited - Thailand
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Indian Oil Corporation Limited
- Gujarat Electricity Regulatory Commission - India
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- Bukit Baiduri Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- Maheswari Brothers Coal Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- GVK Power & Infra Limited - India
- Parry Sugars Refinery, India
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Larsen & Toubro Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Globalindo Alam Lestari - Indonesia
- Australian Coal Association
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- Trasteel International SA, Italy
- CNBM International Corporation - China
- European Bulk Services B.V. - Netherlands
- PNOC Exploration Corporation - Philippines
- Formosa Plastics Group - Taiwan
- Bukit Asam (Persero) Tbk - Indonesia
- Central Electricity Authority - India
- Toyota Tsusho Corporation, Japan
- Ind-Barath Power Infra Limited - India
- Coalindo Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Bhoruka Overseas - Indonesia
- Siam City Cement PLC, Thailand
- Sarangani Energy Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- SMC Global Power, Philippines
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Chettinad Cement Corporation Ltd - India
- Planning Commission, India
- GMR Energy Limited - India
- Heidelberg Cement - Germany
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Global Coal Blending Company Limited - Australia
- Karaikal Port Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Eastern Energy - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Vizag Seaport Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- Essar Steel Hazira Ltd - India
- PTC India Limited - India
- Vedanta Resources Plc - India
- White Energy Company Limited
- Neyveli Lignite Corporation Ltd, - India
- Bahari Cakrawala Sebuku - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Malabar Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Baramulti Group, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Pendopo Energi Batubara - Indonesia
- Economic Council, Georgia
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Sinarmas Energy and Mining - Indonesia
- Sojitz Corporation - Japan
- LBH Netherlands Bv - Netherlands
- Miang Besar Coal Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Ministry of Transport, Egypt
- Gujarat Sidhee Cement - India
- Savvy Resources Ltd - HongKong
- Rio Tinto Coal - Australia
- Goldman Sachs - Singapore
- Altura Mining Limited, Indonesia
- Eastern Coal Council - USA
- Kepco SPC Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Dalmia Cement Bharat India
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- South Luzon Thermal Energy Corporation
- Commonwealth Bank - Australia
- Parliament of New Zealand
- Petron Corporation, Philippines
- PowerSource Philippines DevCo
- Makarim & Taira - Indonesia
- Uttam Galva Steels Limited - India
- Chamber of Mines of South Africa
- Madhucon Powers Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Carbofer General Trading SA - India
- Videocon Industries ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Riau Bara Harum - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kobexindo Tractors - Indoneisa
- Bukit Makmur.PT - Indonesia
- Romanian Commodities Exchange
- Power Finance Corporation Ltd., India
- Central Java Power - Indonesia
- Energy Link Ltd, New Zealand
- London Commodity Brokers - England
- Tamil Nadu electricity Board
- Wilmar Investment Holdings
- Alfred C Toepfer International GmbH - Germany
- Cigading International Bulk Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- India Bulls Power Limited - India
- The Treasury - Australian Government
- Tata Chemicals Ltd - India
- McConnell Dowell - Australia
- SN Aboitiz Power Inc, Philippines
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Barasentosa Lestari - Indonesia
- Mercator Lines Limited - India
- Borneo Indobara - Indonesia
- Interocean Group of Companies - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- New Zealand Coal & Carbon
- Edison Trading Spa - Italy
- Electricity Authority, New Zealand
- Indian Energy Exchange, India
- Australian Commodity Traders Exchange
- Intertek Mineral Services - Indonesia
|
| |
| |
|
