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.
|
|
Wednesday, 29 November 17
THERMAL COAL MARKETS WERE A LITTLE BIT MORE SUBDUED - DANIEL HYNES, ANZ
Coal prices were stronger, led by gains in coking coal. Premium hard coking coal jumped above USD200/t for the first time in two months, said Danie ...
Wednesday, 29 November 17
SHIPPING MARKET INSIGHT - VASILIS MOIRIS
In line with most expectations for the end of this month, during the past days the Dry Bulk market realized a significant rebound that sent the BDI ...
Tuesday, 28 November 17
THE DRY BULK MARKET HAS SHOWN A REMARKABLE RECOVERY THIS YEAR - GEORGE LAZARIDIS
The Dry Bulk market has shown a remarkable recovery this year with the average earnings having increased by around 63% this year so far compared to ...
Friday, 24 November 17
U.S. PRODUCED 14.9 MMST FOR THE WEEK ENDING NOV 18; UP 0.9% W/W - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 14.9 million short ton ...
Thursday, 23 November 17
PANAMAX: ANOTHER SLOW AND UNEVENTFUL WEEK; DECREASING FREIGHT RATES IN BOTH HEMISPHERES - FEARNLEYS
Supramax
A quiet start to the week. USG closed last week a bit tighter, and continued into the new week on a positive tone with little concluded, ...
|
|
|
Showing 1866 to 1870 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Maharashtra Electricity Regulatory Commission - India
- Billiton Holdings Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Ceylon Electricity Board - Sri Lanka
- Chamber of Mines of South Africa
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Indian Energy Exchange, India
- Eastern Energy - Thailand
- Madhucon Powers Ltd - India
- Kartika Selabumi Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Banpu Public Company Limited - Thailand
- LBH Netherlands Bv - Netherlands
- Kapuas Tunggal Persada - Indonesia
- VISA Power Limited - India
- Simpson Spence & Young - Indonesia
- TeaM Sual Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Mintek Dendrill Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Global Business Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Minerals Council of Australia
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Planning Commission, India
- Heidelberg Cement - Germany
- Karbindo Abesyapradhi - Indoneisa
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- Directorate Of Revenue Intelligence - India
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
- Meenaskhi Energy Private Limited - India
- The University of Queensland
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Central Electricity Authority - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sarangani Energy Corporation, Philippines
- Interocean Group of Companies - India
- Semirara Mining Corp, Philippines
- Anglo American - United Kingdom
- Electricity Authority, New Zealand
- Krishnapatnam Port Company Ltd. - India
- South Luzon Thermal Energy Corporation
- Ministry of Transport, Egypt
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- Alfred C Toepfer International GmbH - Germany
- Borneo Indobara - Indonesia
- Manunggal Multi Energi - Indonesia
- Bharathi Cement Corporation - India
- Independent Power Producers Association of India
- Romanian Commodities Exchange
- Bhushan Steel Limited - India
- Indogreen Group - Indonesia
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- Sojitz Corporation - Japan
- Aditya Birla Group - India
- Edison Trading Spa - Italy
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- Wilmar Investment Holdings
- Videocon Industries ltd - India
- ASAPP Information Group - India
- Eastern Coal Council - USA
- Jaiprakash Power Ventures ltd
- Holcim Trading Pte Ltd - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Globalindo Alam Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Sindya Power Generating Company Private Ltd
- OPG Power Generation Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement PLC, Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indo Tambangraya Megah - Indonesia
- Kepco SPC Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Rashtriya Ispat Nigam Limited - India
- Bangladesh Power Developement Board
- The State Trading Corporation of India Ltd
- Aboitiz Power Corporation - Philippines
- Lanco Infratech Ltd - India
- GMR Energy Limited - India
- India Bulls Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- Orica Australia Pty. Ltd.
- MS Steel International - UAE
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Vizag Seaport Private Limited - India
- Orica Mining Services - Indonesia
- Marubeni Corporation - India
- Siam City Cement - Thailand
- IEA Clean Coal Centre - UK
- Gujarat Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Energy Link Ltd, New Zealand
- Kumho Petrochemical, South Korea
- Sical Logistics Limited - India
- Mercuria Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- PowerSource Philippines DevCo
- Kideco Jaya Agung - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Coal and Oil Company - UAE
- Goldman Sachs - Singapore
- Intertek Mineral Services - Indonesia
- Bhatia International Limited - India
- Iligan Light & Power Inc, Philippines
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- Price Waterhouse Coopers - Russia
- Cement Manufacturers Association - India
- CNBM International Corporation - China
- Pendopo Energi Batubara - Indonesia
- Formosa Plastics Group - Taiwan
- Leighton Contractors Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Renaissance Capital - South Africa
- Tamil Nadu electricity Board
- Gujarat Sidhee Cement - India
- Makarim & Taira - Indonesia
- Attock Cement Pakistan Limited
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Metalloyd Limited - United Kingdom
- Antam Resourcindo - Indonesia
- Salva Resources Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Bulk Trading Sa - Switzerland
- Latin American Coal - Colombia
- Bukit Makmur.PT - Indonesia
- Ministry of Finance - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Electricity Generating Authority of Thailand
- Posco Energy - South Korea
- Timah Investasi Mineral - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Star Paper Mills Limited - India
- Medco Energi Mining Internasional
- Standard Chartered Bank - UAE
- European Bulk Services B.V. - Netherlands
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Indian Oil Corporation Limited
- Parliament of New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- The Treasury - Australian Government
- Sakthi Sugars Limited - India
- Indonesian Coal Mining Association
- Tata Chemicals Ltd - India
- Oldendorff Carriers - Singapore
- Baramulti Group, Indonesia
- Port Waratah Coal Services - Australia
- Ambuja Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- SMC Global Power, Philippines
- Indika Energy - Indonesia
- CIMB Investment Bank - Malaysia
- IHS Mccloskey Coal Group - USA
- Carbofer General Trading SA - India
- Thai Mozambique Logistica
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Uttam Galva Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Ministry of Mines - Canada
- Global Green Power PLC Corporation, Philippines
- Deloitte Consulting - India
- Neyveli Lignite Corporation Ltd, - India
- Australian Commodity Traders Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- GAC Shipping (India) Pvt Ltd
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Karaikal Port Pvt Ltd - India
- Riau Bara Harum - Indonesia
- SMG Consultants - Indonesia
- Mercator Lines Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ICICI Bank Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GVK Power & Infra Limited - India
- Georgia Ports Authority, United States
- Samtan Co., Ltd - South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhoruka Overseas - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- White Energy Company Limited
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Trasteel International SA, Italy
|
| |
| |
|
