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Tuesday, 17 September 19
THE DRY BULK FREIGHT MARKET IS ALREADY ON A DOWNWARD CORRECTION - ALLIED
 Here we are again, just a breath before the final quarter of the year. Under typical circumstances and on the basis of what we have seen during the summer months, one would be (theoretically) extra bullish in terms of what to expect for the final part of 2019, said Thomas Chasapis, Research Analyst of Allied shipping Research in his latest report.
However, can the current positive dynamics be sustained over the next three months? According to Thomas Chasapis many views have been expressed in respect to the true state of the dry bulk market. At this point, it seems as though the most vital question is as to whether the market has any direction at all (with the hope of some sort rebalancing soon), or whether the recent summer trends in the freight market have created ample artificial noise in a market that is currently stagnant.
Thomas Chasapis further noted, the dry bulk freight market is already on a downward correction, hardly a surprise, given that the balance point of the market does not seem to be by any measure with a BDI of above 2,500bp (at least for now). This has been expressed emphatically in the paper market, with current forward curves indicating massive corrections moving forward. Notwithstanding this, future contracts for the BCI-5TC average for the final quarter have been formed at slightly above US$ 25,000/day. It is true that this level is an extreme discounted when compared to where the current freight market is at, but when we consider that we are talking about a 3-month average figure which is above US$ 10,000/day more than the year-to-date average.
Just remember what we were seeing for similar contracts exactly one year earlier and at what levels the market closed off the final three months of 2018. So, are we truly faced with a pessimistic view right now? The reality is slightly more ambiguous as we shift the focus over to the macroeconomic indicators. Y-o-y massive corrections have brought with them a huge wave of negativism towards the market.
According to Thomas Chasapis, forward contracts for 2020 felt a correction of around US$ 5,000/day, while 2021 and the years beyond that were a little less so effected though still noting significant corrections. All-in-all, even under these conditions, there are many positive indicators to be seen as well. If the current forward curve is "right", the freight market will be on time to catch-up and finish the year with an average of at least on par with that of 2018 (if not higher). Despite the impressive recovery, many will probably still view the year as a step back. However, it is interesting to note how this is translated when we assess asset prices into the mix? Taking as general indication the value of a 5yr old Capesize vessel, year-to-date the average figure has eased back by roughly 11%, while, given the overall stability of second hand values, we can expect this discount to remain relatively the same during the remaining months of the year. So, in terms of an earnings to price ratio analysis, this would suggest that the market is in a much better state (y-o -y) in relative terms. However, things change when we compare this to the risk profile involved. At this point, the excessive volatility levels noted in freight rates would point to the current prices being in theory fairly "expensive".
This however is only partially true, as volatility measures are agnostic to any market direction and only measure the difference from the average (either on the positive or the negative side). Given the aggressive upward movement in freight rates as of late, the standard deviation inevitably gives an exaggerated result. However, when you take into consideration what we have been seeing in the futures market, you may well find further ground to support the indication that has been given from the earnings to price ratio side, Thomas Chasapis concluded.
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Monday, 23 September 19
CHINA RECORDS SLOWER GROWTH IN COAL PRODUCTION - XINHUA
The growth of China’s raw coal production slowed down in August, data from the National Bureau of Statistics (NBS) showed.
Aro ...
Friday, 20 September 19
INDIA TO INVITE BIDS FOR COMMERCIAL COAL MINING IN DECEMBER - MINISTER FOR COAL
India aims to begin the process of holding the first round of commercial coal mining auctions December end, Minister for Coal, Mines and Parliament ...
Friday, 20 September 19
INDIA: ECONOMIC SLOWDOWN IMPACTS COAL IMPORT CARGO IN H1 FY20 - PTI
Economic slowdown has impacted coal import cargo in the first half of this fiscal, as overall cargo growth at major ports registered a marginal gro ...
Wednesday, 18 September 19
SHIPPING MARKET INSIGHT - INTERMODAL
During the first week of September, I had the privilege of attending the Donsö Shipping Meet 2019, in Donsö, a small island of around 1,& ...
Tuesday, 17 September 19
PANAMA SHIP REGISTRY MODERNIZES SHIP REGISTRATION
The Panama Ship Registry has announced it will integrate in a single platform “Electronic Ship Registration System (ESRS)” the present ...
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- McConnell Dowell - Australia
- OPG Power Generation Pvt Ltd - India
- Chamber of Mines of South Africa
- Parry Sugars Refinery, India
- Minerals Council of Australia
- Global Coal Blending Company Limited - Australia
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Chettinad Cement Corporation Ltd - India
- Kobexindo Tractors - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Bharathi Cement Corporation - India
- Savvy Resources Ltd - HongKong
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Manunggal Multi Energi - Indonesia
- New Zealand Coal & Carbon
- Siam City Cement PLC, Thailand
- Thai Mozambique Logistica
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Cigading International Bulk Terminal - Indonesia
- ASAPP Information Group - India
- Borneo Indobara - Indonesia
- Essar Steel Hazira Ltd - India
- Power Finance Corporation Ltd., India
- Heidelberg Cement - Germany
- Indogreen Group - Indonesia
- Salva Resources Pvt Ltd - India
- Marubeni Corporation - India
- Makarim & Taira - Indonesia
- Eastern Coal Council - USA
- SMG Consultants - Indonesia
- Indo Tambangraya Megah - Indonesia
- IEA Clean Coal Centre - UK
- Holcim Trading Pte Ltd - Singapore
- Carbofer General Trading SA - India
- Mintek Dendrill Indonesia
- Pendopo Energi Batubara - Indonesia
- Australian Coal Association
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Latin American Coal - Colombia
- Australian Commodity Traders Exchange
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
- Xindia Steels Limited - India
- PNOC Exploration Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Eastern Energy - Thailand
- Sakthi Sugars Limited - India
- Cement Manufacturers Association - India
- Global Green Power PLC Corporation, Philippines
- Aditya Birla Group - India
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Coalindo Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- International Coal Ventures Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- SN Aboitiz Power Inc, Philippines
- Wilmar Investment Holdings
- Parliament of New Zealand
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Port Waratah Coal Services - Australia
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- Alfred C Toepfer International GmbH - Germany
- Kapuas Tunggal Persada - Indonesia
- Posco Energy - South Korea
- Kumho Petrochemical, South Korea
- Energy Link Ltd, New Zealand
- Economic Council, Georgia
- Kohat Cement Company Ltd. - Pakistan
- Bulk Trading Sa - Switzerland
- Pipit Mutiara Jaya. PT, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Transport, Egypt
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- GMR Energy Limited - India
- CNBM International Corporation - China
- Medco Energi Mining Internasional
- Bayan Resources Tbk. - Indonesia
- Indian Energy Exchange, India
- Directorate General of MIneral and Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Anglo American - United Kingdom
- Oldendorff Carriers - Singapore
- Rio Tinto Coal - Australia
- Semirara Mining Corp, Philippines
- Central Electricity Authority - India
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Renaissance Capital - South Africa
- CIMB Investment Bank - Malaysia
- Globalindo Alam Lestari - Indonesia
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- South Luzon Thermal Energy Corporation
- Bukit Makmur.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Binh Thuan Hamico - Vietnam
- Krishnapatnam Port Company Ltd. - India
- LBH Netherlands Bv - Netherlands
- Jindal Steel & Power Ltd - India
- Straits Asia Resources Limited - Singapore
- ICICI Bank Limited - India
- Tata Chemicals Ltd - India
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Kepco SPC Power Corporation, Philippines
- Planning Commission, India
- Commonwealth Bank - Australia
- Intertek Mineral Services - Indonesia
- London Commodity Brokers - England
- Jaiprakash Power Ventures ltd
- GAC Shipping (India) Pvt Ltd
- Uttam Galva Steels Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Barasentosa Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Singapore Mercantile Exchange
- PetroVietnam Power Coal Import and Supply Company
- Tamil Nadu electricity Board
- Dalmia Cement Bharat India
- Vedanta Resources Plc - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bangladesh Power Developement Board
- Ambuja Cements Ltd - India
- Edison Trading Spa - Italy
- Indian Oil Corporation Limited
- Wood Mackenzie - Singapore
- Sojitz Corporation - Japan
- Indika Energy - Indonesia
- Attock Cement Pakistan Limited
- Goldman Sachs - Singapore
- Independent Power Producers Association of India
- PowerSource Philippines DevCo
- Karaikal Port Pvt Ltd - India
- White Energy Company Limited
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- IHS Mccloskey Coal Group - USA
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Authority, New Zealand
- Formosa Plastics Group - Taiwan
- Romanian Commodities Exchange
- Meenaskhi Energy Private Limited - India
- The State Trading Corporation of India Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement - Thailand
- The University of Queensland
- Orica Australia Pty. Ltd.
- Riau Bara Harum - Indonesia
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Altura Mining Limited, Indonesia
- Iligan Light & Power Inc, Philippines
- Interocean Group of Companies - India
- VISA Power Limited - India
- European Bulk Services B.V. - Netherlands
- PTC India Limited - India
- Orica Mining Services - Indonesia
- Mercuria Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Deloitte Consulting - India
- Semirara Mining and Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- Thiess Contractors Indonesia
- Electricity Generating Authority of Thailand
- Agrawal Coal Company - India
- Toyota Tsusho Corporation, Japan
- MS Steel International - UAE
- Global Business Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Sarangani Energy Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Bukit Asam (Persero) Tbk - Indonesia
- India Bulls Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Sical Logistics Limited - India
- Africa Commodities Group - South Africa
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- GVK Power & Infra Limited - India
- Price Waterhouse Coopers - Russia
- Trasteel International SA, Italy
- Larsen & Toubro Limited - India
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Ministry of Finance - Indonesia
- Maheswari Brothers Coal Limited - India
- Georgia Ports Authority, United States
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