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.
|
|
Sunday, 13 December 15
THE LOW VESSEL DEMANDS PUSHED DOWN BALTIC DRY INDEX FURTHER DOWN
COALspot.com: The low vessel demand across nearly all vessel sizes pushed the Baltic Exchange’s main sea freight index further down in this F ...
Sunday, 13 December 15
DRY BULK RATES KEEP ON FALLING AS LOW VESSEL DEMAND IS STILL THE NORM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market nowadays is in an endless downward spiral, which as it turns out is unable to recover, at least as long as the current balance ...
Friday, 11 December 15
US COAL PRODUCTION UP 7.7% IN WEEK ENDED DECEMBER 5, 2015
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 16.1 million shor ...
Thursday, 10 December 15
LIENING CARGO - WHICH LIEN CLAUSE APPLIES TO THE BILL OF LADING? : WIKBORG REIN | HELLENIC SHIPPING NEWS
KNOWLEDGE TO ELEVATE
In a dry bulk market where a charterer is not paying freight or hire, its counterparty is often left to consider whether ...
Thursday, 10 December 15
CANADIAN MINER TECK ANNOUNCES LNG HAUL TRUCK PILOT PROJECT
Teck Resources Limited is piloting the use of liquefied natural gas (LNG) as a fuel source in six haul trucks at its Fording River steelmakin ...
|
|
|
Showing 2656 to 2660 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Mercator Lines Limited - India
- Timah Investasi Mineral - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- PTC India Limited - India
- Metalloyd Limited - United Kingdom
- Edison Trading Spa - Italy
- Wilmar Investment Holdings
- Mintek Dendrill Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Karaikal Port Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Central Electricity Authority - India
- AsiaOL BioFuels Corp., Philippines
- Parliament of New Zealand
- Mercuria Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Sical Logistics Limited - India
- International Coal Ventures Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Indo Tambangraya Megah - Indonesia
- Bharathi Cement Corporation - India
- Bangladesh Power Developement Board
- LBH Netherlands Bv - Netherlands
- Australian Commodity Traders Exchange
- Goldman Sachs - Singapore
- Sarangani Energy Corporation, Philippines
- Energy Link Ltd, New Zealand
- Ind-Barath Power Infra Limited - India
- Grasim Industreis Ltd - India
- Kaltim Prima Coal - Indonesia
- Global Business Power Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kobexindo Tractors - Indoneisa
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- Trasteel International SA, Italy
- Sinarmas Energy and Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Finance - Indonesia
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- Gujarat Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- Gujarat Sidhee Cement - India
- European Bulk Services B.V. - Netherlands
- Kartika Selabumi Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kohat Cement Company Ltd. - Pakistan
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- Banpu Public Company Limited - Thailand
- Planning Commission, India
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Iligan Light & Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Mining Services - Indonesia
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- Coalindo Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Power Finance Corporation Ltd., India
- Kideco Jaya Agung - Indonesia
- Indonesian Coal Mining Association
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SMC Global Power, Philippines
- SMG Consultants - Indonesia
- Indogreen Group - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Posco Energy - South Korea
- Xindia Steels Limited - India
- Price Waterhouse Coopers - Russia
- Straits Asia Resources Limited - Singapore
- Parry Sugars Refinery, India
- OPG Power Generation Pvt Ltd - India
- Economic Council, Georgia
- Chamber of Mines of South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ambuja Cements Ltd - India
- Formosa Plastics Group - Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bayan Resources Tbk. - Indonesia
- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Star Paper Mills Limited - India
- Lanco Infratech Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- Marubeni Corporation - India
- GVK Power & Infra Limited - India
- MS Steel International - UAE
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Borneo Indobara - Indonesia
- Ministry of Mines - Canada
- Larsen & Toubro Limited - India
- Electricity Generating Authority of Thailand
- The Treasury - Australian Government
- Australian Coal Association
- Meenaskhi Energy Private Limited - India
- Tamil Nadu electricity Board
- SN Aboitiz Power Inc, Philippines
- Sojitz Corporation - Japan
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- Uttam Galva Steels Limited - India
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- Petrochimia International Co. Ltd.- Taiwan
- Global Coal Blending Company Limited - Australia
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Standard Chartered Bank - UAE
- The State Trading Corporation of India Ltd
- India Bulls Power Limited - India
- Bhatia International Limited - India
- Medco Energi Mining Internasional
- Kepco SPC Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- Interocean Group of Companies - India
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Oldendorff Carriers - Singapore
- Coastal Gujarat Power Limited - India
- ICICI Bank Limited - India
- Bhushan Steel Limited - India
- Vizag Seaport Private Limited - India
- Central Java Power - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Romanian Commodities Exchange
- Latin American Coal - Colombia
- Toyota Tsusho Corporation, Japan
- Minerals Council of Australia
- IEA Clean Coal Centre - UK
- Kapuas Tunggal Persada - Indonesia
- Bhoruka Overseas - Indonesia
- Samtan Co., Ltd - South Korea
- Therma Luzon, Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Ministry of Transport, Egypt
- VISA Power Limited - India
- Vedanta Resources Plc - India
- South Luzon Thermal Energy Corporation
- TNB Fuel Sdn Bhd - Malaysia
- Simpson Spence & Young - Indonesia
- Meralco Power Generation, Philippines
- Georgia Ports Authority, United States
- CIMB Investment Bank - Malaysia
- Renaissance Capital - South Africa
- TeaM Sual Corporation - Philippines
- Thiess Contractors Indonesia
- McConnell Dowell - Australia
- Pendopo Energi Batubara - Indonesia
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Bukit Baiduri Energy - Indonesia
- Mjunction Services Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- Global Green Power PLC Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Indika Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- CNBM International Corporation - China
- Commonwealth Bank - Australia
- Ceylon Electricity Board - Sri Lanka
- Carbofer General Trading SA - India
- Bulk Trading Sa - Switzerland
- Eastern Coal Council - USA
- The University of Queensland
- White Energy Company Limited
- Essar Steel Hazira Ltd - India
- ASAPP Information Group - India
- Baramulti Group, Indonesia
- Madhucon Powers Ltd - India
- Manunggal Multi Energi - Indonesia
- Intertek Mineral Services - Indonesia
- Riau Bara Harum - Indonesia
- Africa Commodities Group - South Africa
- Aboitiz Power Corporation - Philippines
- Eastern Energy - Thailand
- Independent Power Producers Association of India
- Deloitte Consulting - India
- Maharashtra Electricity Regulatory Commission - India
- Anglo American - United Kingdom
- Makarim & Taira - Indonesia
- New Zealand Coal & Carbon
- GMR Energy Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate Of Revenue Intelligence - India
- Indian Energy Exchange, India
- PowerSource Philippines DevCo
- GN Power Mariveles Coal Plant, Philippines
- Videocon Industries ltd - India
- Orica Australia Pty. Ltd.
- Heidelberg Cement - Germany
- Kumho Petrochemical, South Korea
|
| |
| |
|
