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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 be the case, i.e. ordering more ships than the market needed to cater to demand. As a result, returns have plummeted, leaving many funds looking for a way out, most notably the dry bulk market, as tanker owners are still protected from the downturn. In its latest report, Gibson noted that “undoubtedly 2015 was a memorable year. For some a year to forget for tankers a year to enjoy. Whilst the misery has continued for many, tankers are still generating healthy returns a cross most sectors, in part aided by cheap bunker prices. However, sentiment, particularly in the tanker time charter market has certainly taken a hit as of late as the global economic outlook becomes increasingly bearish”.
According to Gibson’s analysis, global stock markets have witnessed a terrible start with the China led malaise wiping billions off investments across the globe, unsettling the nerves of many investors, which perhaps explains the loss of appetite for long term commitments. It may be the view of some wealth managers mantra that the economy remains on track but it is difficult for many to stay calm when your investments have dropped in value by 15 to 20 per cent since April 2015. Furthermore after the initial boost of low oil prices, much concern is now focused on the health of the major producers who have expensed vast sums of foreign cash reserves in the face of falling oil prices”.
The shipbroker also noted that “back in August 2014, we highlighted the growing role of private equity in the shipping sector as the involvement of major banks gradually faded from its peak in 2007. We speculated that at least $7 billion would come from this sector in 2014 which was still a drop in the ocean in their overall portfolios. Wilbur Ross estimated that private equity pumped $16 billion into shipping between 2008 and 2013 – two and a half times the amount generated through initial public offerings”.
Meanwhile, “whilst the tanker sector has so far escaped the horrors of dry cargo, there is no longer the hunger of investors to continue their involvement with shipping, as the overall performance of these investments has not fulfilled expectations and they are looking for a swift exit. We argued back in 2014 that the activity was being driven by “other people’s money “ without sufficient restraints which can result in over ordering and this has certainly been a factor. As a result of that activity, several larger private equity groups that invested in shipping in the past, have decided to cut their losses and sell. Investment funds and banks do not want to be shipowners, trying to sell off unwanted assets where the buyers have the upper hand”, Gibson said.
It went on to note “whilst many traditional shipping banks continue to wind down their shipping portfolios, other banks have signalled an intention to increase their presence in the sector with China’s CMB Financial Leasing looking to increase shipping and aviation from 12% of its existing book to 25-40%. This points towards conventional banks playing more of a role once again in ship finance, yet it may not be the traditional European banks fulfilling this role”.
Gibson said though, that “there is a great deal of pain at the moment but this will be seen by some shipowners in a positive light going forward, where realistic ship ping constraints return t o investment decisions, preventing the mass ordering of unwanted new buildings that we have seen from some of the recently funded players from private equity. There is no question that this scenario will put an enormous strain on shipyards who will need to be able to offer financing such as we have seen from Chinese banks and the Export credit agencies in other Asian shipbuilding nations. However their biggest problem is that the market has more than enough ships to meet demand and shipbuilders are struggling to fill their forward slots. This sort of market brings the cash buyer to the fore and there are clear signs that they are focusing in on the opportunities that are being presented. In the dry sector as prices plummet, the traditional second hand cash buyers are becoming increasingly visible. For now tanker owners remain very much protected by the continued healthy state of the market, but we should take nothing for granted as we will encounter more challenges as we progress through 2016”, the shipbroker concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Friday, 19 February 16
U.S. WEEKLY COAL PRODUCTION ROSE 2.6% FROM LAST WEEK - EIA
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 13.2 million shor ...
Thursday, 18 February 16
INDIA NEEDS INTERNATIONAL SUPPORT ON HIGH EFFICIENCY COAL - WORLD COAL ASSOCIATION
Speaking at a conference in New Delhi today, World Coal Association Chief Executive Benjamin Sporton said the critical role of coal in driving econ ...
Thursday, 18 February 16
CHINA COAL SECTOR - 2015 RESULTS BLEAK, 2016 UNLIKELY TO BE ANY BETTER - FITCH
COALspot.com: China Coal Sector’s Financial Woes to Worsen in 2016.
Fitch Ratings says that the 2015 full-year result previews issued by ...
Thursday, 18 February 16
PANAMAX RATES OUT OF ECSA WERE STILL GAINING A PREMIUM OVER THE REST OF THE MARKET - INTERMODAL
The BDI moved further down last week, fact that hardly took anyone by surprise as the lunar year holidays in Asia on top of the already depre ...
Wednesday, 17 February 16
TAP ON OPPORTUNITIES IN GROWING ELECTRICITY DEMAND AND NEW COAL POWER PROJECT DEVELOPMENTS IN THE PHILIPPINES - IBC
Tap on Opportunities in Growing Electricity Demand and New Coal Power Project Developments in the Philippines
Coal Power Generation 2016
19- ...
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- Cigading International Bulk Terminal - Indonesia
- Chamber of Mines of South Africa
- Tata Chemicals Ltd - India
- SMG Consultants - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Wood Mackenzie - Singapore
- Latin American Coal - Colombia
- Heidelberg Cement - Germany
- Barasentosa Lestari - Indonesia
- Mjunction Services Limited - India
- Savvy Resources Ltd - HongKong
- Orica Australia Pty. Ltd.
- Ind-Barath Power Infra Limited - India
- Bhushan Steel Limited - India
- Baramulti Group, Indonesia
- Bulk Trading Sa - Switzerland
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Coal and Oil Company - UAE
- Directorate General of MIneral and Coal - Indonesia
- Manunggal Multi Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Renaissance Capital - South Africa
- Billiton Holdings Pty Ltd - Australia
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Antam Resourcindo - Indonesia
- Eastern Energy - Thailand
- Energy Link Ltd, New Zealand
- Karaikal Port Pvt Ltd - India
- Marubeni Corporation - India
- McConnell Dowell - Australia
- Romanian Commodities Exchange
- Trasteel International SA, Italy
- Therma Luzon, Inc, Philippines
- The University of Queensland
- PTC India Limited - India
- Timah Investasi Mineral - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Ministry of Mines - Canada
- Grasim Industreis Ltd - India
- Pendopo Energi Batubara - Indonesia
- Indo Tambangraya Megah - Indonesia
- Independent Power Producers Association of India
- Thai Mozambique Logistica
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Medco Energi Mining Internasional
- Gujarat Sidhee Cement - India
- Sical Logistics Limited - India
- Merrill Lynch Commodities Europe
- Coastal Gujarat Power Limited - India
- San Jose City I Power Corp, Philippines
- Thiess Contractors Indonesia
- Sojitz Corporation - Japan
- Bangladesh Power Developement Board
- GMR Energy Limited - India
- Sarangani Energy Corporation, Philippines
- Singapore Mercantile Exchange
- Intertek Mineral Services - Indonesia
- Oldendorff Carriers - Singapore
- Indika Energy - Indonesia
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Orica Mining Services - Indonesia
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- Kartika Selabumi Mining - Indonesia
- Ministry of Transport, Egypt
- Jindal Steel & Power Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- CIMB Investment Bank - Malaysia
- Parliament of New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Sakthi Sugars Limited - India
- Posco Energy - South Korea
- Port Waratah Coal Services - Australia
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- Indian Oil Corporation Limited
- Rio Tinto Coal - Australia
- Minerals Council of Australia
- Neyveli Lignite Corporation Ltd, - India
- Bayan Resources Tbk. - Indonesia
- Maheswari Brothers Coal Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Central Electricity Authority - India
- AsiaOL BioFuels Corp., Philippines
- Interocean Group of Companies - India
- Georgia Ports Authority, United States
- Pipit Mutiara Jaya. PT, Indonesia
- Sindya Power Generating Company Private Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PowerSource Philippines DevCo
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- India Bulls Power Limited - India
- Directorate Of Revenue Intelligence - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Standard Chartered Bank - UAE
- Bukit Baiduri Energy - Indonesia
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- European Bulk Services B.V. - Netherlands
- Straits Asia Resources Limited - Singapore
- Simpson Spence & Young - Indonesia
- Attock Cement Pakistan Limited
- Sree Jayajothi Cements Limited - India
- Iligan Light & Power Inc, Philippines
- Vizag Seaport Private Limited - India
- Sinarmas Energy and Mining - Indonesia
- CNBM International Corporation - China
- The Treasury - Australian Government
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Alfred C Toepfer International GmbH - Germany
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Siam City Cement - Thailand
- Jaiprakash Power Ventures ltd
- Makarim & Taira - Indonesia
- Ambuja Cements Ltd - India
- Petron Corporation, Philippines
- Meralco Power Generation, Philippines
- Parry Sugars Refinery, India
- Metalloyd Limited - United Kingdom
- Indonesian Coal Mining Association
- Gujarat Electricity Regulatory Commission - India
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Australian Coal Association
- Power Finance Corporation Ltd., India
- Krishnapatnam Port Company Ltd. - India
- Indian Energy Exchange, India
- Siam City Cement PLC, Thailand
- Price Waterhouse Coopers - Russia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhatia International Limited - India
- Carbofer General Trading SA - India
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- Samtan Co., Ltd - South Korea
- GAC Shipping (India) Pvt Ltd
- Central Java Power - Indonesia
- Goldman Sachs - Singapore
- Global Business Power Corporation, Philippines
- Eastern Coal Council - USA
- Semirara Mining and Power Corporation, Philippines
- Malabar Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Vedanta Resources Plc - India
- ICICI Bank Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Riau Bara Harum - Indonesia
- International Coal Ventures Pvt Ltd - India
- Planning Commission, India
- Semirara Mining Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Kobexindo Tractors - Indoneisa
- The State Trading Corporation of India Ltd
- Kohat Cement Company Ltd. - Pakistan
- Electricity Authority, New Zealand
- London Commodity Brokers - England
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- PNOC Exploration Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- VISA Power Limited - India
- Altura Mining Limited, Indonesia
- Electricity Generating Authority of Thailand
- Videocon Industries ltd - India
- Borneo Indobara - Indonesia
- SMC Global Power, Philippines
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Global Coal Blending Company Limited - Australia
- Agrawal Coal Company - India
- Bhoruka Overseas - Indonesia
- Global Green Power PLC Corporation, Philippines
- Africa Commodities Group - South Africa
- Indogreen Group - Indonesia
- Mintek Dendrill Indonesia
- Star Paper Mills Limited - India
- Holcim Trading Pte Ltd - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Wilmar Investment Holdings
- TeaM Sual Corporation - Philippines
- New Zealand Coal & Carbon
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- SN Aboitiz Power Inc, Philippines
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- Maharashtra Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- Bukit Asam (Persero) Tbk - Indonesia
- Mercator Lines Limited - India
- Dalmia Cement Bharat India
- GN Power Mariveles Coal Plant, Philippines
- LBH Netherlands Bv - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Economic Council, Georgia
- Uttam Galva Steels Limited - India
- Anglo American - United Kingdom
- MS Steel International - UAE
- Gujarat Mineral Development Corp Ltd - India
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