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 $13m. Dry bulk fundamentals, particularly on the demand side with the Chinese economy maturing, don’t look helpful at all (see SIW 1207), but with the 5 year old price at almost half that of a newbuild, who really knows what the longer-term opportunity might be?
Fortune favours the brave, but they also say that fools rush in. The outlook seems scary but investors might also have half an eye on their peers who invested at low points in the price cycle in the past. That’s the beauty of volatile and cyclical sectors, but it’s tricky food for thought for shipping investors. Are they willing to party like it’s 1999? Have a nice day.
Source: Clarksons
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Monday, 08 February 16
DRY-BULK SHIPPING DIVING DEEP
COALspot.com: The freight markets continued to fall this past week.
The Baltic Dry Index (BDI) of dry-bulk shipping freights, a measure of glo ...
Monday, 08 February 16
DRY BULK: SHIPBROKER SEES BDI MARKET REACHING LOW POINT OF 236 POINTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The endless pit that is the dry bulk market over the past two months, has been the issue of debate among ship owners, shipbroker and analysts alike ...
Friday, 05 February 16
COAL INDIA EYES COAL MINES IN SOUTH AFRICA - PTI
“Coal India Ltd has plans of acquiring coal mines in South Africa,” an official said. It is looking at acquiring mines in partnership w ...
Friday, 05 February 16
U.S. WEEKLY COAL OUTPUT ROSE 4.2% TO 13.6 MMST
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 13.6 million shor ...
Thursday, 04 February 16
CAPESIZE: WEST AUSTRALIAN TO CHINA HAS BEEN CONCLUDED AT US$ 2.85 PMT AND THE C3 MARKET REMAINS INACTIVE - FEARNLEYS
Capesize
As everyone is getting ready for the Chinese new year, already depressed rates are under further pressure.
According to Fearnleys, ...
|
|
|
Showing 2571 to 2575 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- PetroVietnam Power Coal Import and Supply Company
- Karaikal Port Pvt Ltd - India
- Georgia Ports Authority, United States
- Agrawal Coal Company - India
- Independent Power Producers Association of India
- The Treasury - Australian Government
- Anglo American - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Videocon Industries ltd - India
- Chamber of Mines of South Africa
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- Romanian Commodities Exchange
- Orica Australia Pty. Ltd.
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- Orica Mining Services - Indonesia
- Indonesian Coal Mining Association
- Krishnapatnam Port Company Ltd. - India
- Sical Logistics Limited - India
- Africa Commodities Group - South Africa
- Directorate General of MIneral and Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Merrill Lynch Commodities Europe
- Ind-Barath Power Infra Limited - India
- MS Steel International - UAE
- Eastern Coal Council - USA
- McConnell Dowell - Australia
- Kohat Cement Company Ltd. - Pakistan
- Planning Commission, India
- Latin American Coal - Colombia
- Larsen & Toubro Limited - India
- Deloitte Consulting - India
- Antam Resourcindo - Indonesia
- Jaiprakash Power Ventures ltd
- Kartika Selabumi Mining - Indonesia
- PTC India Limited - India
- Aditya Birla Group - India
- South Luzon Thermal Energy Corporation
- Salva Resources Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- PowerSource Philippines DevCo
- Bangladesh Power Developement Board
- OPG Power Generation Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Electricity Authority, New Zealand
- Maheswari Brothers Coal Limited - India
- Mercator Lines Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- The State Trading Corporation of India Ltd
- Attock Cement Pakistan Limited
- Energy Development Corp, Philippines
- Grasim Industreis Ltd - India
- GAC Shipping (India) Pvt Ltd
- Parliament of New Zealand
- Global Business Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Posco Energy - South Korea
- London Commodity Brokers - England
- Lanco Infratech Ltd - India
- Indian Energy Exchange, India
- VISA Power Limited - India
- Meralco Power Generation, Philippines
- Bayan Resources Tbk. - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Mercuria Energy - Indonesia
- Central Electricity Authority - India
- Bhatia International Limited - India
- Therma Luzon, Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- The University of Queensland
- Australian Coal Association
- Baramulti Group, Indonesia
- Tata Chemicals Ltd - India
- Kideco Jaya Agung - Indonesia
- Trasteel International SA, Italy
- Rashtriya Ispat Nigam Limited - India
- Timah Investasi Mineral - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- Indogreen Group - Indonesia
- Thiess Contractors Indonesia
- Kaltim Prima Coal - Indonesia
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Altura Mining Limited, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Sindya Power Generating Company Private Ltd
- Banpu Public Company Limited - Thailand
- Miang Besar Coal Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Toyota Tsusho Corporation, Japan
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- ICICI Bank Limited - India
- SMG Consultants - Indonesia
- Kumho Petrochemical, South Korea
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- Power Finance Corporation Ltd., India
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- GVK Power & Infra Limited - India
- Port Waratah Coal Services - Australia
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Indika Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Electricity Generating Authority of Thailand
- Renaissance Capital - South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- SN Aboitiz Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- Wood Mackenzie - Singapore
- Oldendorff Carriers - Singapore
- Savvy Resources Ltd - HongKong
- Metalloyd Limited - United Kingdom
- PNOC Exploration Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Malabar Cements Ltd - India
- San Jose City I Power Corp, Philippines
- Essar Steel Hazira Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Cigading International Bulk Terminal - Indonesia
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Commonwealth Bank - Australia
- Goldman Sachs - Singapore
- Australian Commodity Traders Exchange
- Star Paper Mills Limited - India
- White Energy Company Limited
- CIMB Investment Bank - Malaysia
- Uttam Galva Steels Limited - India
- Ministry of Finance - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Coalindo Energy - Indonesia
- Riau Bara Harum - Indonesia
- Bharathi Cement Corporation - India
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhushan Steel Limited - India
- Semirara Mining Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Madhucon Powers Ltd - India
- Sojitz Corporation - Japan
- Sree Jayajothi Cements Limited - India
- Global Coal Blending Company Limited - Australia
- European Bulk Services B.V. - Netherlands
- Intertek Mineral Services - Indonesia
- Carbofer General Trading SA - India
- Wilmar Investment Holdings
- TNB Fuel Sdn Bhd - Malaysia
- India Bulls Power Limited - India
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- Xindia Steels Limited - India
- Coastal Gujarat Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Indo Tambangraya Megah - Indonesia
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Interocean Group of Companies - India
- Cement Manufacturers Association - India
- GMR Energy Limited - India
- Central Java Power - Indonesia
- Eastern Energy - Thailand
- Ceylon Electricity Board - Sri Lanka
- Kobexindo Tractors - Indoneisa
- Rio Tinto Coal - Australia
- Tamil Nadu electricity Board
- Bahari Cakrawala Sebuku - Indonesia
- Jindal Steel & Power Ltd - India
- Heidelberg Cement - Germany
- Borneo Indobara - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mintek Dendrill Indonesia
- Mjunction Services Limited - India
- IEA Clean Coal Centre - UK
- Petron Corporation, Philippines
- Medco Energi Mining Internasional
- Aboitiz Power Corporation - Philippines
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Siam City Cement - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Marubeni Corporation - India
- CNBM International Corporation - China
- ASAPP Information Group - India
|
| |
| |
|
