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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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- Neyveli Lignite Corporation Ltd, - India
- Pipit Mutiara Jaya. PT, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PowerSource Philippines DevCo
- Global Coal Blending Company Limited - Australia
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- London Commodity Brokers - England
- Port Waratah Coal Services - Australia
- Oldendorff Carriers - Singapore
- Bhushan Steel Limited - India
- Aditya Birla Group - India
- Parry Sugars Refinery, India
- New Zealand Coal & Carbon
- Sarangani Energy Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- India Bulls Power Limited - India
- Ministry of Finance - Indonesia
- Mercator Lines Limited - India
- Coalindo Energy - Indonesia
- Bangladesh Power Developement Board
- IHS Mccloskey Coal Group - USA
- Georgia Ports Authority, United States
- Siam City Cement - Thailand
- Romanian Commodities Exchange
- PNOC Exploration Corporation - Philippines
- Trasteel International SA, Italy
- PTC India Limited - India
- Sakthi Sugars Limited - India
- Kepco SPC Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- McConnell Dowell - Australia
- Australian Coal Association
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- Leighton Contractors Pty Ltd - Australia
- Carbofer General Trading SA - India
- Meralco Power Generation, Philippines
- Vizag Seaport Private Limited - India
- Intertek Mineral Services - Indonesia
- Bhatia International Limited - India
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Barasentosa Lestari - Indonesia
- Borneo Indobara - Indonesia
- ICICI Bank Limited - India
- Sojitz Corporation - Japan
- Maharashtra Electricity Regulatory Commission - India
- Attock Cement Pakistan Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Toyota Tsusho Corporation, Japan
- South Luzon Thermal Energy Corporation
- Posco Energy - South Korea
- Central Java Power - Indonesia
- Gujarat Sidhee Cement - India
- GN Power Mariveles Coal Plant, Philippines
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- Makarim & Taira - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Eastern Coal Council - USA
- Commonwealth Bank - Australia
- Africa Commodities Group - South Africa
- Indian Energy Exchange, India
- VISA Power Limited - India
- Kaltim Prima Coal - Indonesia
- Thiess Contractors Indonesia
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Iligan Light & Power Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Cigading International Bulk Terminal - Indonesia
- Edison Trading Spa - Italy
- Offshore Bulk Terminal Pte Ltd, Singapore
- Agrawal Coal Company - India
- Antam Resourcindo - Indonesia
- Meenaskhi Energy Private Limited - India
- Tamil Nadu electricity Board
- Coal and Oil Company - UAE
- Indogreen Group - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Petron Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Indonesian Coal Mining Association
- Kartika Selabumi Mining - Indonesia
- Interocean Group of Companies - India
- Parliament of New Zealand
- Australian Commodity Traders Exchange
- Metalloyd Limited - United Kingdom
- Chamber of Mines of South Africa
- Central Electricity Authority - India
- Globalindo Alam Lestari - Indonesia
- Rio Tinto Coal - Australia
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Transport, Egypt
- Eastern Energy - Thailand
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- Larsen & Toubro Limited - India
- Therma Luzon, Inc, Philippines
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- Medco Energi Mining Internasional
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- Formosa Plastics Group - Taiwan
- Bukit Asam (Persero) Tbk - Indonesia
- Independent Power Producers Association of India
- Energy Development Corp, Philippines
- Bulk Trading Sa - Switzerland
- Wilmar Investment Holdings
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Binh Thuan Hamico - Vietnam
- Indo Tambangraya Megah - Indonesia
- OPG Power Generation Pvt Ltd - India
- Deloitte Consulting - India
- Mintek Dendrill Indonesia
- Cement Manufacturers Association - India
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- Electricity Authority, New Zealand
- Pendopo Energi Batubara - Indonesia
- Planning Commission, India
- Rashtriya Ispat Nigam Limited - India
- Siam City Cement PLC, Thailand
- Jorong Barutama Greston.PT - Indonesia
- Minerals Council of Australia
- Grasim Industreis Ltd - India
- San Jose City I Power Corp, Philippines
- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- AsiaOL BioFuels Corp., Philippines
- Coastal Gujarat Power Limited - India
- CIMB Investment Bank - Malaysia
- TeaM Sual Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Goldman Sachs - Singapore
- International Coal Ventures Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- SN Aboitiz Power Inc, Philippines
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- Tata Chemicals Ltd - India
- Bukit Makmur.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- European Bulk Services B.V. - Netherlands
- Semirara Mining and Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining Corp, Philippines
- Mjunction Services Limited - India
- Karaikal Port Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Essar Steel Hazira Ltd - India
- Power Finance Corporation Ltd., India
- Singapore Mercantile Exchange
- Ceylon Electricity Board - Sri Lanka
- Ambuja Cements Ltd - India
- Bukit Baiduri Energy - Indonesia
- IEA Clean Coal Centre - UK
- The Treasury - Australian Government
- Renaissance Capital - South Africa
- Uttam Galva Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Thai Mozambique Logistica
- Petrochimia International Co. Ltd.- Taiwan
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Bharathi Cement Corporation - India
- Madhucon Powers Ltd - India
- The State Trading Corporation of India Ltd
- SMC Global Power, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sical Logistics Limited - India
- Malabar Cements Ltd - India
- LBH Netherlands Bv - Netherlands
- Indika Energy - Indonesia
- Orica Mining Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Directorate Of Revenue Intelligence - India
- White Energy Company Limited
- Sinarmas Energy and Mining - Indonesia
- Riau Bara Harum - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- The University of Queensland
- Vedanta Resources Plc - India
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Chettinad Cement Corporation Ltd - India
- Mercuria Energy - Indonesia
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