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Tuesday, 10 May 16
VOLATILITY? VARIATION NO ENIGMA TO SHIPPING..... - CLARKSONS
 Along with cyclicality, the other characteristic of the shipping markets which receives frequent mention is volatility. This is so evident that the shipping markets are often reported to be many times more volatile than the stock markets or other fluctuating economic variables. Here we take a look at some metrics which shine some light on the relative volatility of the industry.
Measuring The Waves
Many metrics can be used to measure aspects of volatility (though none are perfect). A few are calculated here to compare volatility in the shipping markets with that in the stock and commodity markets. One classic measure of volatility is the ‘coefficient of variation’ which takes the standard deviation of a series over time (a measure of the degree of dispersion of observations in a series) and divides it by the mean (average) level of the series.
Volatile Business
This metric highlights the degree of volatility present in the shipping markets (see graph). For the ClarkSea Index it stands at 50%, for VLCC spot earnings 73% and Capesize spot earnings 104%. For the FTSE-100 the figure stands at 29% and for the S&P 500 43%. The stock markets, often thought highly capricious, appear to be quite a bit less volatile than shipping on this basis (and given that stock markets generally track a trend rather than a cycle, one might have expected their coefficients to be biased upwards). The oil price compares more closely to shipping; the figure for Brent crude stands at 73%. Another useful metric is the average absolute monthly change as a percentage of the mean. For the ClarkSea Index this stands at 8%, for VLCC spot earnings at 26% and Capesize spot earnings 18%. For the FTSE-100 and S&P 500 this stands at around 3% and for Brent at around 6%, so again much lower.
Of course this analysis doesn’t capture everything. It excludes week-to-week (or day-to-day) volatility, though one might suppose that this could further emphasise shipping’s volatility (for example, see VLCC spot earnings on page 2). Equally it does not handle (or ‘de-trend’) indicators differently to account for the fact that stock markets typically follow a long-term trend, rather than a cycle like shipping.
Variation On A Theme?
But, even using a regression approach to ascertain variation from simple trend levels, over 60% of the FTSE-100 movement is explained by the trend. In shipping, much more of the variation appears to remain ‘unexplained’ (less than 10% of the variation of the ClarkSea Index would be accounted for by a simple trend).
Need Good Sea Legs?
So, volatility in shipping easily holds its own against fluctuations in other economic phenomena. It’s a competitive business, and rapid changes in pricing can be driven by the steepness of the supply curve at the margins, as well as a range of quite unpredictable factors. This helps make shipping interesting for asset players and short-term speculators but tricky for investors looking for certainty of return and analysts looking for a clear picture. Like seafarers themselves, shipping market players can quite rightly point to having the stomach for ups and downs as much as anyone.
Have a nice day.
Source: Clarksons
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Tuesday, 15 March 16
ADARO ENERGY LOWERED ITS COAL CASH COST BY 16% TO US$ 27.98 PER TONE IN 2015
Difficult Coal Market Condition Persists in 2015, Adaro Lowers Costs, Reduces Capital Spending and Maintains Solid Liquidity.
PT Adaro E ...
Monday, 14 March 16
THE CS 50 INDEX ROSE $0.16 OR, 0.41% TO $38.82 A TON
COALspot.com: Average 5000 GAR coal index of Indonesian origin rose 0.41 percent week over week to averaging $38.82 per ton on this past Friday, ac ...
Monday, 14 March 16
THE BALTIC EXCHANGE CONTINUED TO ROSE THIS PAST WEEK
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities continued to rise this week helped by higher rates for pa ...
Saturday, 12 March 16
PLN, COAL COMPANIES IN TALKS ABOUT PRICES - THE JAKARTA POST
Following a study that predicted that Indonesia would struggle to provide coal for its power stations in the near future, the government will facil ...
Friday, 11 March 16
ADANI GLOBAL BAGS 0.26 MILLION TONS OF COAL CONTRACT FROM LANKA COAL COMPANY
COALspot.com: Lanka Coal Company (Private) Limited, Sri Lanka has awarded 260,000 +/- 10% tons of Power plant 6300 GAR calorific value coal to Adan ...
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- Indika Energy - Indonesia
- Singapore Mercantile Exchange
- Binh Thuan Hamico - Vietnam
- Orica Australia Pty. Ltd.
- Planning Commission, India
- Rio Tinto Coal - Australia
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- Electricity Generating Authority of Thailand
- Savvy Resources Ltd - HongKong
- Global Green Power PLC Corporation, Philippines
- Bharathi Cement Corporation - India
- Antam Resourcindo - Indonesia
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- MS Steel International - UAE
- Mercator Lines Limited - India
- PTC India Limited - India
- OPG Power Generation Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Port Waratah Coal Services - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aboitiz Power Corporation - Philippines
- Gujarat Electricity Regulatory Commission - India
- Videocon Industries ltd - India
- Manunggal Multi Energi - Indonesia
- Vedanta Resources Plc - India
- Ambuja Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Merrill Lynch Commodities Europe
- Straits Asia Resources Limited - Singapore
- Grasim Industreis Ltd - India
- Siam City Cement - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- International Coal Ventures Pvt Ltd - India
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- GAC Shipping (India) Pvt Ltd
- Ministry of Mines - Canada
- Uttam Galva Steels Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- The University of Queensland
- Ceylon Electricity Board - Sri Lanka
- Central Java Power - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Kepco SPC Power Corporation, Philippines
- Thai Mozambique Logistica
- Australian Commodity Traders Exchange
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- VISA Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- Kobexindo Tractors - Indoneisa
- Indian Oil Corporation Limited
- Indian Energy Exchange, India
- Tamil Nadu electricity Board
- Global Coal Blending Company Limited - Australia
- SMC Global Power, Philippines
- Semirara Mining and Power Corporation, Philippines
- Ministry of Transport, Egypt
- Romanian Commodities Exchange
- AsiaOL BioFuels Corp., Philippines
- Xindia Steels Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Chamber of Mines of South Africa
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Coal Council - USA
- Mintek Dendrill Indonesia
- Bhatia International Limited - India
- Electricity Authority, New Zealand
- London Commodity Brokers - England
- Globalindo Alam Lestari - Indonesia
- Heidelberg Cement - Germany
- Aditya Birla Group - India
- McConnell Dowell - Australia
- Interocean Group of Companies - India
- Orica Mining Services - Indonesia
- San Jose City I Power Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Australian Coal Association
- Kideco Jaya Agung - Indonesia
- Trasteel International SA, Italy
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- Larsen & Toubro Limited - India
- IEA Clean Coal Centre - UK
- Sojitz Corporation - Japan
- CNBM International Corporation - China
- Madhucon Powers Ltd - India
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Borneo Indobara - Indonesia
- Therma Luzon, Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Petron Corporation, Philippines
- Lanco Infratech Ltd - India
- European Bulk Services B.V. - Netherlands
- Vijayanagar Sugar Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Coal and Oil Company - UAE
- PowerSource Philippines DevCo
- Indo Tambangraya Megah - Indonesia
- Toyota Tsusho Corporation, Japan
- Gujarat Sidhee Cement - India
- Pendopo Energi Batubara - Indonesia
- Star Paper Mills Limited - India
- Leighton Contractors Pty Ltd - Australia
- Bayan Resources Tbk. - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- Energy Link Ltd, New Zealand
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- Samtan Co., Ltd - South Korea
- Indogreen Group - Indonesia
- White Energy Company Limited
- Iligan Light & Power Inc, Philippines
- Medco Energi Mining Internasional
- GN Power Mariveles Coal Plant, Philippines
- Maheswari Brothers Coal Limited - India
- Meralco Power Generation, Philippines
- Barasentosa Lestari - Indonesia
- Sree Jayajothi Cements Limited - India
- Minerals Council of Australia
- Holcim Trading Pte Ltd - Singapore
- CIMB Investment Bank - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Cement Manufacturers Association - India
- Africa Commodities Group - South Africa
- Edison Trading Spa - Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Marubeni Corporation - India
- Coalindo Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- Sindya Power Generating Company Private Ltd
- Mercuria Energy - Indonesia
- Parry Sugars Refinery, India
- New Zealand Coal & Carbon
- Central Electricity Authority - India
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Timah Investasi Mineral - Indoneisa
- ICICI Bank Limited - India
- Directorate Of Revenue Intelligence - India
- The Treasury - Australian Government
- Eastern Energy - Thailand
- Sical Logistics Limited - India
- Economic Council, Georgia
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- PNOC Exploration Corporation - Philippines
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Baramulti Group, Indonesia
- India Bulls Power Limited - India
- Independent Power Producers Association of India
- GMR Energy Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Banpu Public Company Limited - Thailand
- Georgia Ports Authority, United States
- Altura Mining Limited, Indonesia
- Oldendorff Carriers - Singapore
- Posco Energy - South Korea
- Bhoruka Overseas - Indonesia
- Siam City Cement PLC, Thailand
- Bulk Trading Sa - Switzerland
- Dalmia Cement Bharat India
- Alfred C Toepfer International GmbH - Germany
- South Luzon Thermal Energy Corporation
- Essar Steel Hazira Ltd - India
- Kartika Selabumi Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Energy Development Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Kumho Petrochemical, South Korea
- Malabar Cements Ltd - India
- Jindal Steel & Power Ltd - India
- Salva Resources Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Ministry of Finance - Indonesia
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- Bukit Baiduri Energy - Indonesia
- Tata Chemicals Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Goldman Sachs - Singapore
- Power Finance Corporation Ltd., India
- Wilmar Investment Holdings
- Cigading International Bulk Terminal - Indonesia
- Parliament of New Zealand
- Formosa Plastics Group - Taiwan
- Latin American Coal - Colombia
- Commonwealth Bank - Australia
- Karaikal Port Pvt Ltd - India
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