We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Tuesday, 07 November 17
DRY BULK SHIPPING: TAKE GOOD CARE OF THE RECOVERY SAYS PETER SAND
 Demand:
Even without much support from Brazilian iron ore exports during August, capesize rates went from $10,000 to $17,000 per day. In September, those gains were retained until Chinese Golden Week in early October reduced trip chartering interest, dampened demand and lowered the freight rates. Not dramatically, but noticeably, says Peter Sand, Chief Shipping Analyst at BIMCO.
Capesize ships have (as of 26 October) been in profitable territory (above $15,300 per day) since 11 August and panamaxes likewise, since 5 September (above $10,200 per day).
Handymax/supramax/ultramax owners and operators who fixed their ships after 21 August, have also seen freight rates covering, not just operational expenditures (OPEX) but also capital expenditures (CAPEX), leaving a slim return on investment. This has only happened three times- for more than two days in a row – in the past two years. Finally, the handy size segment has, for the first time since April 2014, reached a freight rate level above $9,000 per day.
According to Peter Sand, this ongoing recovery is still in a “fragile” state – demand has increased but so has supply. This means only a slight fundamental market improvement. The return to permanent profitable freight rates is still way off. The transport demand for dry bulk cargoes in Q1-2018 is considerably lower than the volumes transported in Q4-2017, and that’s the first hurdle to cross. Maintaining slow steaming is another prerequisite to hold onto the gains that have been achieved.
At the centre of dry bulk demand, as always, is China; growing its seaborne imports of coal during the first nine months of 2017 by 18.7%, and its seaborne imports of iron ore during the first eight months, by 6.9% year-on-year. In total, this is a demand growth of 79m tonnes (27 + 52 respectively) for the two commodities year-to-date. Setting a new world record in steel production for the month of August of 74.6m tonnes, resulted in total growth of 5.6% for eight months’ production in 2017, compared with the same period last year.
Another record was reached in September, when Chinese iron ore imports exceeded 100m tonnes for the first time.
While this is much needed by the dry bulk shipping industry to get out of the doldrums of recent years, there may be a limit as to how far this can go. Imagine if steel production stalls, then iron ore imports are likely only to grow at the expense of domestically mined ore.
BIMCO calculates that substitution of low-quality, domestically mined iron ore in China, for imported high-quality iron ore from Brazil or Australia, would have increased imports by 17m tonnes per month in the first eight months of 2017.
Regardless of recent reports, about one in three Chinese iron ore mines being at risk of losing their mining licenses due to environmental issues, the output from Chinese iron ore mines is still up by 5% in the first eight months, year-on-year. One of the key risk elements in the equation is actual steel consumption in China.
In addition to the strong growth that we have seen into China, US coal exports have certainly added to the panamax and capesize demand in the Atlantic since Q4 2016.
Peter Sand further noted in his report, from November 2016 to July 2017, we have seen a monthly average of 6.4m tonnes of coal being exported from the US to a vast number of destinations like Japan, Egypt, Turkey, South Korea, China, Guatemala, India, Spain and Morocco. This is up by 61% versus the same nine months of the year before. Key export ports, mostly on the Atlantic side, are Hampton Roads and Baltimore, where panamax and capesize ships are used to export 60% of the total volume. In the US Gulf, Mobile dominates exports with shipments of coal in panamax. On the Pacific side, US coal exports are handled via Vancouver.
The total tonne miles adjusted demand growth rate in 2017, is forecast to be 3.9%, the highest in three years.
Supply:
Commenting on supply side, Peter Sand, Chief Shipping Analyst at BIMCO said, the delivery pace has reduced significantly since H1-2017, but so has demolition activity. During H1-2017, 28m DWT was delivered, while 8.5m DWT was demolished. Whereas Q3-2017 has seen only 6m DWT delivered, and 3.6m DWT permanently leaving the active fleet.
Demolition of handymax tonnage, has been dominant this year – a natural reaction from owners operating in that segment, which has seen fleet growth around 5% pa for some time now, clearly outpacing all the other dry bulk segments.
Contracting activity for the year so far, has as expected, gone up from the extraordinarily low levels that we experienced in 2016. While Q1 2017 was still quiet in terms of actual orders, newbuild interest was growing in the background. The larger segments are popular. Panamax and very large ore carriers (VLOC) account for 15 out of the 17m DWT ordered in total, year- to- date (until 2 October). It’s worth noting that many of the VLOCs have been ordered against a long-term charter, most likely replacing existing long-term chartered VLOCs when they are retired. Later in October, another 5 VLOCs were ordered.
For the first nine months of the year, the dry bulk fleet has grown by 2.7%, already a three-year high. BIMCO expects the fleet will end up growing by 3.1% to 16m DWT as demolition expectations are lower than the previously anticipated 19m DWT.
In the future, expected fleet growth remains quite low based on the ships on order now – and does not include orders not yet placed. 2018 could see the fleet grow by less than 1%.
Outlook:
Should we look no further than China when it comes to dry bulk market demand?
No, is the short answer – at least not in relation to steel production ingredients – iron ore and coking coal. In 2008, global iron ore imports were at 841m tonnes, out of which China took 436m tonnes (52%). In 2017, the global seaborne market is at 1,478m tonnes, out of which China takes 1,075m tonnes (73%).
For thermal coal, a few other nations are worth taking note of, in addition to China. Those are India, South Korea and Malaysia. Additionally, the US seems to have re-established itself as an option in the seaborne coking coal market, providing long distance voyages into Asia. Ever since the outbreak of the global financial crisis in 2008, the dry bulk market has only had one growth area: Asia. All other regions of the world contribute with steady or declining imports.
Note that European imports of:
- Iron ore are down from 140m tonnes in 2008 to 117m tonnes in 2017
- Coking coal are down from 59m tonnes in 2008 to 46m tonnes in 2017
- Thermal coal are down from 156m tonnes in 2008 to 128m tonnes in 2017.
For the current time and Q4 2017, selected seaborne trades from major exporters including iron ore, coal, grains, soya and steel products are expected to grow by 3.4% from Q3 2017 (source: SSY). Whereas, grain peaks in Q1 and Q3, and soya in Q2, the seaborne trading of steel products, coking coal, thermal coal and iron ore will all peak in Q4.
After a bit of a downturn in the market during the first half of October (which was expected), demand lifted freight rates again. It’s time to make the most of it, before seasonal low demand in Q1-2018 get the upper hand and push freight rates down Peter Sand, Chief Shipping Analyst at BIMCO concluded.
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Tuesday, 05 December 17
OIL PRICES HAVE GAINED SOME TRACTION THESE PAST FEW DAYS ON TALKS OF ANOTHER OPEC & RUSSIA PRODUCTION CUT EXTENSION - GERRY LATHROP
Oil prices have gained some traction these past few days on talks of another OPEC (including non-OPEC Russia) production cut extension.
The cu ...
Tuesday, 05 December 17
THE COKING AND THERMAL COAL RECORDING SMALL GAINS - DANIEL HYNES
Coal markets were higher, with both coking and thermal coal recording small gains, said Daniel Hynes Senior Commodity Strategist at ANZ in his late ...
Tuesday, 05 December 17
WEEKLY US COAL PRODUCTION ESTIMATES DIP WEEK OVER WEEK - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 14.1 million short ton ...
Thursday, 30 November 17
CONTEMPLATING COAL'S CONTROVERSY AT COP23 - BENJAMIN SPORTON
Representing the coal industry at climate talks is never going to be an easy proposition. For many people, coal and climate action are incompatible ...
Wednesday, 29 November 17
THE LAST DAYS OF COAL? - ALIBRA SHIPPING
At least 15 countries have joined an international alliance to phase out coal use for power generation before 2030.
Britain, Canada, Denmark, ...
|
|
|
Showing 1861 to 1865 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Indonesian Coal Mining Association
- Sarangani Energy Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Kobexindo Tractors - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- SMC Global Power, Philippines
- Kideco Jaya Agung - Indonesia
- San Jose City I Power Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Indogreen Group - Indonesia
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Ministry of Finance - Indonesia
- Karaikal Port Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Manunggal Multi Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Salva Resources Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- IEA Clean Coal Centre - UK
- Rashtriya Ispat Nigam Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Coal Association
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- The Treasury - Australian Government
- TeaM Sual Corporation - Philippines
- Sakthi Sugars Limited - India
- Gujarat Sidhee Cement - India
- Semirara Mining and Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Oldendorff Carriers - Singapore
- SMG Consultants - Indonesia
- Latin American Coal - Colombia
- Karbindo Abesyapradhi - Indoneisa
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- Indian Oil Corporation Limited
- Sojitz Corporation - Japan
- Kumho Petrochemical, South Korea
- Larsen & Toubro Limited - India
- Baramulti Group, Indonesia
- Bhatia International Limited - India
- Anglo American - United Kingdom
- Meenaskhi Energy Private Limited - India
- Romanian Commodities Exchange
- Barasentosa Lestari - Indonesia
- MS Steel International - UAE
- Kepco SPC Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Xindia Steels Limited - India
- Makarim & Taira - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- ASAPP Information Group - India
- Economic Council, Georgia
- Renaissance Capital - South Africa
- Tata Chemicals Ltd - India
- Coastal Gujarat Power Limited - India
- Australian Commodity Traders Exchange
- South Luzon Thermal Energy Corporation
- Pendopo Energi Batubara - Indonesia
- Siam City Cement - Thailand
- Medco Energi Mining Internasional
- GAC Shipping (India) Pvt Ltd
- Parry Sugars Refinery, India
- Goldman Sachs - Singapore
- Sinarmas Energy and Mining - Indonesia
- Lanco Infratech Ltd - India
- Carbofer General Trading SA - India
- Interocean Group of Companies - India
- Dalmia Cement Bharat India
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Directorate Of Revenue Intelligence - India
- Central Java Power - Indonesia
- Minerals Council of Australia
- Central Electricity Authority - India
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Essar Steel Hazira Ltd - India
- Antam Resourcindo - Indonesia
- Bharathi Cement Corporation - India
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Electricity Generating Authority of Thailand
- Binh Thuan Hamico - Vietnam
- London Commodity Brokers - England
- SN Aboitiz Power Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Standard Chartered Bank - UAE
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- Gujarat Mineral Development Corp Ltd - India
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Indo Tambangraya Megah - Indonesia
- Bangladesh Power Developement Board
- Agrawal Coal Company - India
- IHS Mccloskey Coal Group - USA
- Ministry of Mines - Canada
- Ambuja Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Simpson Spence & Young - Indonesia
- Mintek Dendrill Indonesia
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- CIMB Investment Bank - Malaysia
- Trasteel International SA, Italy
- Borneo Indobara - Indonesia
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- Ministry of Transport, Egypt
- Jindal Steel & Power Ltd - India
- Coalindo Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Coal and Oil Company - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Vedanta Resources Plc - India
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- Asmin Koalindo Tuhup - Indonesia
- VISA Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Global Business Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Singapore Mercantile Exchange
- Bukit Makmur.PT - Indonesia
- Indika Energy - Indonesia
- Aditya Birla Group - India
- Holcim Trading Pte Ltd - Singapore
- Uttam Galva Steels Limited - India
- Kartika Selabumi Mining - Indonesia
- Mercuria Energy - Indonesia
- Semirara Mining Corp, Philippines
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- Globalindo Alam Lestari - Indonesia
- Africa Commodities Group - South Africa
- Cigading International Bulk Terminal - Indonesia
- Deloitte Consulting - India
- Leighton Contractors Pty Ltd - Australia
- Mercator Lines Limited - India
- Riau Bara Harum - Indonesia
- Formosa Plastics Group - Taiwan
- PowerSource Philippines DevCo
- McConnell Dowell - Australia
- Parliament of New Zealand
- Krishnapatnam Port Company Ltd. - India
- Petron Corporation, Philippines
- India Bulls Power Limited - India
- Iligan Light & Power Inc, Philippines
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate General of MIneral and Coal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- GMR Energy Limited - India
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- Marubeni Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Eastern Energy - Thailand
- Rio Tinto Coal - Australia
- Madhucon Powers Ltd - India
- Global Coal Blending Company Limited - Australia
- Siam City Cement PLC, Thailand
- Thiess Contractors Indonesia
- Eastern Coal Council - USA
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- New Zealand Coal & Carbon
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Altura Mining Limited, Indonesia
- Meralco Power Generation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Sindya Power Generating Company Private Ltd
- Billiton Holdings Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- Bhoruka Overseas - Indonesia
- Star Paper Mills Limited - India
- PTC India Limited - India
- Global Green Power PLC Corporation, Philippines
- Sical Logistics Limited - India
- GVK Power & Infra Limited - India
- Orica Mining Services - Indonesia
- Indian Energy Exchange, India
- Bulk Trading Sa - Switzerland
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Energy Link Ltd, New Zealand
- Metalloyd Limited - United Kingdom
- White Energy Company Limited
- Kohat Cement Company Ltd. - Pakistan
- Alfred C Toepfer International GmbH - Germany
- CNBM International Corporation - China
- Straits Asia Resources Limited - Singapore
- Price Waterhouse Coopers - Russia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
|
| |
| |
|
