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Saturday, 21 December 19
SHIPPING'S SUPPLY AND DEMAND TRENDING OFF BALANCE - BIMCO
 One of the most worrying trends that has developed recently – which will affect shipping demand in the years to come – is the falling trade-to-GDP ratio.
The falling ratio can be explained by slowing globalistation as well as increasing protectionist measures being implemented around the world, spear headed by the US. The raised barriers to trade are here to stay as we enter a new decade, with the shipping industry stuck with the consequences.
The trade war is the clearest example of these extra barriers to trade, and although a phase 1 deal was reached in December, the most difficult issues have yet to be addressed, and BIMCO therefore expects the trade war to continue to plague shipping between the US and China in 2020. Unfortunately, they are not the only countries engaging in tariff wars. The EU also faces additional tariffs from the US and we see trade tensions between Japan and South Korea.
The effects of the worsening of the fundamental shipping market balances this year will be felt in 2020, as the balance is not reset to zero when the calendar year changes. BIMCO continues to warn that the worsening balance between the supply of ships and the demand will be detrimental to shipowners’ ability to pass on the additional costs associated with compliance of the new IMO 2020 Sulphur Cap. It will depend on the freight rates to which extent the additional costs are covered, which in turn depend on the market conditions; the better the market, the easier it is to pass costs on.
Dry Bulk shipping
The biggest concern for Capesize shipping in 2020 is the trend in China, where iron ore imports may fall for the third year in a row. The structural change in China’s steel production, towards using scrap steel in favour of imported iron ore, means that Chinese demand for iron ore can no longer be counted on to increase demand for Capesize ships, with imports having peaked in 2017.
For the dry bulk shipping industry there is more bad news from China. Its soya bean imports have become an important part of the trade war and how it is viewed, but even aside from the trade war, the outlook for soya bean trades into China are weak. Its demand will be considerably lower due to the largest ever culling of pigs which consume most of China’s soya bean imports. It will take years for the Chinese pig population to return to the same size as before the cull, and even then, lowering the soya content in pig’s feed will have lasting consequences on these trades.
The high fleet growth in 2019 (4.1%) will play out into 2020 when the fleet is also expected to grow by more than demand. The cumulative impact of these growth rates mean that the gap between demand for shipping and the supply of ships will continue to grow, putting pressure on freight rates throughout the year.
Tanker Shipping
Crude oil tankers have certainly been in the headlines in 2019 due to geopolitical developments and as freight rates reached record levels as a result, but going into 2020, the fundamentals remain unchanged. This means that after the seasonal boost fades away in the first quarter, the high freight rates in the VLCC-market are likely to disappear, as the market fundamentals have in fact worsened in 2019, with an eight year high fleet growth of 6.3%.
Fleet growth has also been high in the oil product tanker market, with many owners aiming to benefit from the IMO 2020 Sulphur Cap and the boost that BIMCO expects it will bring to the oil product tanker shipping industry. The boost are on the back of the new trades for the transport of compliant bunker fuels from the refineries to the bunkering ports.
While this boost will improve tanker earnings in the first 3-6 months of 2020, once the short term boost will fade away, the challenge facing the market is that the new ships will still be around , and will instead be fighting for cargoes in an already over-supplied market.
One of the major developments expected in 2020 is for the US to become a net exporter of crude oil on an annual basis. The increasing proportion of global crude oil exports coming from the US is good news for the tanker industry as this involves longer sailing distances to the Far East, where the major importers are, compared to exports from the Middle East.
Source: Peter Sand, Chief Shipping Analyst, BIMCO
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Saturday, 30 November 19
PANAMAX: LEVELS IMPROVED IN THE PACIFIC MARKET TOO WITH $11,000 BEING CONCLUDED ON AN 81,000DWT SHIP FOR AN INDONESIA TO CHINA COAL TRIP - BALTIC BRIEFING
Capesize
The market has been well supported over the past week, led primarily by the Atlantic Basin. After bottoming last week, sentiment was s ...
Friday, 29 November 19
FITCHRATINGS MAINTAINS NEGATIVE 2020 OUTLOOK ON SHIPPING, AS TIGHTER SUPPLY HELPS, BUT SOFTER DEMAND DRAGS
Fitch’s Sector Outlook: Negative
We maintain a negative sector outlook for global shipping because of the forecast slowdown of ...
Friday, 29 November 19
INDONESIA PRODUCES 390 MLN TONNES OF COAL IN JAN-SEPT: MINISTER - REUTERS
Indonesia’s production of coal for the January-September period was 390 million tonnes, Energy and Mineral Resources Minister Arifin Tasrif s ...
Wednesday, 27 November 19
SHIPPING MARKET INSIGHT - INTERMODAL
As the end of the fourth quarter is approaching, one could say that the wet market has maintained the strong pace observed during the third qu ...
Tuesday, 26 November 19
PREPARATIONS INTENSIFY AS 1 JANUARY 2020 GLOBAL CUT IN SULPHUR IN SHIP'S FUEL OIL LOOMS: IMO
“IMO 2020” requirements for ships to cut sulphur oxide emissions enter into effect in just over one month’s time. This will signi ...
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- GAC Shipping (India) Pvt Ltd
- PTC India Limited - India
- Agrawal Coal Company - India
- Ministry of Transport, Egypt
- GN Power Mariveles Coal Plant, Philippines
- Ambuja Cements Ltd - India
- Ministry of Finance - Indonesia
- Posco Energy - South Korea
- Kideco Jaya Agung - Indonesia
- Karaikal Port Pvt Ltd - India
- Electricity Authority, New Zealand
- Gujarat Sidhee Cement - India
- Chamber of Mines of South Africa
- Wilmar Investment Holdings
- Planning Commission, India
- Vedanta Resources Plc - India
- Energy Development Corp, Philippines
- Coalindo Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- Grasim Industreis Ltd - India
- Mintek Dendrill Indonesia
- Samtan Co., Ltd - South Korea
- Latin American Coal - Colombia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Mercuria Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- McConnell Dowell - Australia
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Bhatia International Limited - India
- Kumho Petrochemical, South Korea
- Renaissance Capital - South Africa
- Merrill Lynch Commodities Europe
- Formosa Plastics Group - Taiwan
- Asmin Koalindo Tuhup - Indonesia
- Singapore Mercantile Exchange
- Orica Australia Pty. Ltd.
- Kaltim Prima Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- Trasteel International SA, Italy
- Kalimantan Lumbung Energi - Indonesia
- Interocean Group of Companies - India
- PetroVietnam Power Coal Import and Supply Company
- GVK Power & Infra Limited - India
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- The University of Queensland
- Banpu Public Company Limited - Thailand
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- Ind-Barath Power Infra Limited - India
- Central Java Power - Indonesia
- Jaiprakash Power Ventures ltd
- Gujarat Mineral Development Corp Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- India Bulls Power Limited - India
- Bharathi Cement Corporation - India
- The State Trading Corporation of India Ltd
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- Meralco Power Generation, Philippines
- Salva Resources Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Parliament of New Zealand
- Medco Energi Mining Internasional
- Directorate Of Revenue Intelligence - India
- London Commodity Brokers - England
- Bukit Baiduri Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Baramulti Group, Indonesia
- Bhushan Steel Limited - India
- Central Electricity Authority - India
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Miang Besar Coal Terminal - Indonesia
- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- Parry Sugars Refinery, India
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- Cement Manufacturers Association - India
- Standard Chartered Bank - UAE
- Sojitz Corporation - Japan
- Kartika Selabumi Mining - Indonesia
- Iligan Light & Power Inc, Philippines
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Marubeni Corporation - India
- Sical Logistics Limited - India
- Antam Resourcindo - Indonesia
- Romanian Commodities Exchange
- New Zealand Coal & Carbon
- Deloitte Consulting - India
- Electricity Generating Authority of Thailand
- Petrochimia International Co. Ltd.- Taiwan
- White Energy Company Limited
- CIMB Investment Bank - Malaysia
- Coastal Gujarat Power Limited - India
- VISA Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- IEA Clean Coal Centre - UK
- Globalindo Alam Lestari - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Energy Link Ltd, New Zealand
- International Coal Ventures Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Anglo American - United Kingdom
- Bayan Resources Tbk. - Indonesia
- Edison Trading Spa - Italy
- Aboitiz Power Corporation - Philippines
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- Larsen & Toubro Limited - India
- Heidelberg Cement - Germany
- Pendopo Energi Batubara - Indonesia
- Indian Energy Exchange, India
- Makarim & Taira - Indonesia
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Economic Council, Georgia
- Holcim Trading Pte Ltd - Singapore
- OPG Power Generation Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Vizag Seaport Private Limited - India
- Oldendorff Carriers - Singapore
- Alfred C Toepfer International GmbH - Germany
- GMR Energy Limited - India
- Binh Thuan Hamico - Vietnam
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- Rashtriya Ispat Nigam Limited - India
- Thai Mozambique Logistica
- Indo Tambangraya Megah - Indonesia
- Georgia Ports Authority, United States
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dalmia Cement Bharat India
- PNOC Exploration Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Barasentosa Lestari - Indonesia
- Ministry of Mines - Canada
- Attock Cement Pakistan Limited
- Borneo Indobara - Indonesia
- Siam City Cement PLC, Thailand
- Madhucon Powers Ltd - India
- Bangladesh Power Developement Board
- Global Business Power Corporation, Philippines
- SMC Global Power, Philippines
- Goldman Sachs - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Global Green Power PLC Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Rio Tinto Coal - Australia
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Chettinad Cement Corporation Ltd - India
- Lanco Infratech Ltd - India
- Tata Chemicals Ltd - India
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Maharashtra Electricity Regulatory Commission - India
- Global Coal Blending Company Limited - Australia
- Sindya Power Generating Company Private Ltd
- Eastern Coal Council - USA
- Mercator Lines Limited - India
- SN Aboitiz Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Star Paper Mills Limited - India
- Riau Bara Harum - Indonesia
- Independent Power Producers Association of India
- Pipit Mutiara Jaya. PT, Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Xindia Steels Limited - India
- AsiaOL BioFuels Corp., Philippines
- Thiess Contractors Indonesia
- Bulk Trading Sa - Switzerland
- South Luzon Thermal Energy Corporation
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Simpson Spence & Young - Indonesia
- Straits Asia Resources Limited - Singapore
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- Power Finance Corporation Ltd., India
- Metalloyd Limited - United Kingdom
- Indian Oil Corporation Limited
- Bukit Asam (Persero) Tbk - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Kepco SPC Power Corporation, Philippines
- CNBM International Corporation - China
- Petron Corporation, Philippines
- Australian Commodity Traders Exchange
- Indika Energy - Indonesia
- Essar Steel Hazira Ltd - India
- MS Steel International - UAE
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Aditya Birla Group - India
- Africa Commodities Group - South Africa
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