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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, 05 January 16
4200 GAR COAL INDEX FALL TOWARD $27;SLIPPED 28.05% YEAR-TO-DATE
COALspot.com: Average 5000 GAR coal index has not moved in the past week, averaging $40.12 per ton on last Thursday, according to CS (i) Coal Index ...
Monday, 04 January 16
CFR SOUTH CHINA COAL SWAP REMAIN FLAT OVER CHRISTMAS & NEW YEAR HOLIDAYS
COALspot.com: API 8 CFR South China Coal swap for Q1’ 2016 delivery rose US$ 0.68 (1.64%) per ton month over month.
A commodity swap is ...
Friday, 01 January 16
FOB INDONESIA COAL SWAP FOR Q1'16 DELIVERY CLOSED AT $36.75 PER TON
COALspot.com: Indonesian coal swap delivery Q1 2016 declined month on month but flat week over week.
According to AsiaClear OTC coal swap' ...
Thursday, 31 December 15
COAL PRICES FELL ON WEAK DEMAND
COALspot.com: Q1’ 2016 API4 FOB Richards Bay Coal swap decline month over month and slightly up week over week.
The Q1’ 2016 ...
Thursday, 31 December 15
2016 FOB NEWCASTLE COAL SWAP RALLY TO CLOSE AT $37.98/TON
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2016 delivery rose another $1.48 per ton (4.05%) this past week compared to the sam ...
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Showing 2626 to 2630 news of total 6871 |
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- Star Paper Mills Limited - India
- Semirara Mining Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Riau Bara Harum - Indonesia
- Georgia Ports Authority, United States
- Coastal Gujarat Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Ambuja Cements Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sree Jayajothi Cements Limited - India
- Parry Sugars Refinery, India
- Globalindo Alam Lestari - Indonesia
- Heidelberg Cement - Germany
- Wood Mackenzie - Singapore
- Attock Cement Pakistan Limited
- Power Finance Corporation Ltd., India
- Orica Australia Pty. Ltd.
- The University of Queensland
- Therma Luzon, Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Directorate General of MIneral and Coal - Indonesia
- Banpu Public Company Limited - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Thiess Contractors Indonesia
- Ind-Barath Power Infra Limited - India
- GMR Energy Limited - India
- Medco Energi Mining Internasional
- Electricity Authority, New Zealand
- Mjunction Services Limited - India
- Manunggal Multi Energi - Indonesia
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Ministry of Finance - Indonesia
- Singapore Mercantile Exchange
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- Economic Council, Georgia
- Romanian Commodities Exchange
- Interocean Group of Companies - India
- Semirara Mining and Power Corporation, Philippines
- Meralco Power Generation, Philippines
- OPG Power Generation Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Makarim & Taira - Indonesia
- Toyota Tsusho Corporation, Japan
- Ministry of Transport, Egypt
- Metalloyd Limited - United Kingdom
- Barasentosa Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Larsen & Toubro Limited - India
- Iligan Light & Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Sojitz Corporation - Japan
- Maheswari Brothers Coal Limited - India
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- Price Waterhouse Coopers - Russia
- Trasteel International SA, Italy
- Jaiprakash Power Ventures ltd
- International Coal Ventures Pvt Ltd - India
- Bhatia International Limited - India
- Petron Corporation, Philippines
- Agrawal Coal Company - India
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- CNBM International Corporation - China
- Oldendorff Carriers - Singapore
- Tamil Nadu electricity Board
- European Bulk Services B.V. - Netherlands
- London Commodity Brokers - England
- TeaM Sual Corporation - Philippines
- IEA Clean Coal Centre - UK
- Savvy Resources Ltd - HongKong
- Bangladesh Power Developement Board
- Indian Energy Exchange, India
- Altura Mining Limited, Indonesia
- Vizag Seaport Private Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Malabar Cements Ltd - India
- Independent Power Producers Association of India
- Bukit Baiduri Energy - Indonesia
- New Zealand Coal & Carbon
- Bharathi Cement Corporation - India
- GN Power Mariveles Coal Plant, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Indika Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Renaissance Capital - South Africa
- San Jose City I Power Corp, Philippines
- Indogreen Group - Indonesia
- Bulk Trading Sa - Switzerland
- The Treasury - Australian Government
- Jindal Steel & Power Ltd - India
- Xindia Steels Limited - India
- Mercator Lines Limited - India
- Uttam Galva Steels Limited - India
- CIMB Investment Bank - Malaysia
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- Aboitiz Power Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Anglo American - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Australian Coal Association
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Mines - Canada
- Mintek Dendrill Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Port Waratah Coal Services - Australia
- Sakthi Sugars Limited - India
- Meenaskhi Energy Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Energy Development Corp, Philippines
- Eastern Energy - Thailand
- Grasim Industreis Ltd - India
- Kideco Jaya Agung - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Sical Logistics Limited - India
- Karaikal Port Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- The State Trading Corporation of India Ltd
- India Bulls Power Limited - India
- Vedanta Resources Plc - India
- Merrill Lynch Commodities Europe
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Orica Mining Services - Indonesia
- Commonwealth Bank - Australia
- Pendopo Energi Batubara - Indonesia
- Indonesian Coal Mining Association
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Leighton Contractors Pty Ltd - Australia
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- PowerSource Philippines DevCo
- PTC India Limited - India
- Siam City Cement - Thailand
- Bukit Makmur.PT - Indonesia
- Kumho Petrochemical, South Korea
- Kartika Selabumi Mining - Indonesia
- Bayan Resources Tbk. - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- PetroVietnam Power Coal Import and Supply Company
- Parliament of New Zealand
- Standard Chartered Bank - UAE
- ICICI Bank Limited - India
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- Timah Investasi Mineral - Indoneisa
- Siam City Cement PLC, Thailand
- Cement Manufacturers Association - India
- Coalindo Energy - Indonesia
- Central Java Power - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Baramulti Group, Indonesia
- Electricity Generating Authority of Thailand
- Mercuria Energy - Indonesia
- SMG Consultants - Indonesia
- Straits Asia Resources Limited - Singapore
- Africa Commodities Group - South Africa
- Videocon Industries ltd - India
- Chettinad Cement Corporation Ltd - India
- Global Business Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Tata Chemicals Ltd - India
- Posco Energy - South Korea
- Kalimantan Lumbung Energi - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Global Coal Blending Company Limited - Australia
- GAC Shipping (India) Pvt Ltd
- Rio Tinto Coal - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Edison Trading Spa - Italy
- Minerals Council of Australia
- SMC Global Power, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- Wilmar Investment Holdings
- Simpson Spence & Young - Indonesia
- Indian Oil Corporation Limited
- Billiton Holdings Pty Ltd - Australia
- Thai Mozambique Logistica
- Latin American Coal - Colombia
- Krishnapatnam Port Company Ltd. - India
- Salva Resources Pvt Ltd - India
- Dalmia Cement Bharat India
- MS Steel International - UAE
- White Energy Company Limited
- Kobexindo Tractors - Indoneisa
- Chamber of Mines of South Africa
- Planning Commission, India
- Eastern Coal Council - USA
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