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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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Wednesday, 20 November 19
AUSTRALIA'S NEW HOPE POSTS 66% SURGE IN Q1 SALEABLE COAL OUTPUT - REUTERS
Australian coal producer New Hope Corp Ltd reported on Tuesday a 66% jump in saleable coal production in the first quarter, as output ramped up at ...
Wednesday, 20 November 19
THE IMO AND THE PRICE OF GAS OR THE IMPACT OF THE INTERNATIONAL MARITIME ORGANISATION'S SULPHUR 2020 LIMIT FOR MARINE FUEL OIL ON THE PRICE OF GAS - KING & SPALDING
The main bunker fuel for ships is High Sulphur Fuel Oil (HSFO, with sulphur up to 3.5% m/m (mass by mass)). This will all change on 1 January 2020 ...
Wednesday, 20 November 19
SHIPPING MARKET INSIGHT - INTERMODAL
While the market expects the next OPEC meeting, there are still no clear signs indicating that the organization will keep supporting oil prices, wh ...
Monday, 18 November 19
CHINA RECORDS STABLE COAL PRODUCTION IN JAN-OCT: XINHUA
China’s raw coal output registered stable growth in the first 10 months, while its imports remained robust, official data showed.
...
Monday, 18 November 19
SUPRAMAX: IN THE INDONESIAN COAL BUSINESS, A 58KDWT VESSEL FIXED DELIVERY PHILIPPINES, REDELIVERY INDIA AT CLOSE TO $8,000 - BALTIC BRIEFING
Capesize
For most of the week the rates were nudging up under a flurry of activity in the Pacific as levels for the West Australia to China C5 ...
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- Makarim & Taira - Indonesia
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- Eastern Energy - Thailand
- TeaM Sual Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- Essar Steel Hazira Ltd - India
- Africa Commodities Group - South Africa
- Power Finance Corporation Ltd., India
- Bhoruka Overseas - Indonesia
- OPG Power Generation Pvt Ltd - India
- Indogreen Group - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Eastern Coal Council - USA
- Australian Coal Association
- Jaiprakash Power Ventures ltd
- Bukit Makmur.PT - Indonesia
- PTC India Limited - India
- Gujarat Sidhee Cement - India
- GN Power Mariveles Coal Plant, Philippines
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- Bharathi Cement Corporation - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Minerals Council of Australia
- Gujarat Mineral Development Corp Ltd - India
- Independent Power Producers Association of India
- GMR Energy Limited - India
- CIMB Investment Bank - Malaysia
- Bhushan Steel Limited - India
- Barasentosa Lestari - Indonesia
- Ministry of Transport, Egypt
- Metalloyd Limited - United Kingdom
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- Energy Link Ltd, New Zealand
- Baramulti Group, Indonesia
- Pendopo Energi Batubara - Indonesia
- Kobexindo Tractors - Indoneisa
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Kaltim Prima Coal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- MS Steel International - UAE
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Wilmar Investment Holdings
- Global Green Power PLC Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Price Waterhouse Coopers - Russia
- Bangladesh Power Developement Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- Asmin Koalindo Tuhup - Indonesia
- Sakthi Sugars Limited - India
- VISA Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- The State Trading Corporation of India Ltd
- GVK Power & Infra Limited - India
- PowerSource Philippines DevCo
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Alfred C Toepfer International GmbH - Germany
- IHS Mccloskey Coal Group - USA
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Salva Resources Pvt Ltd - India
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Madhucon Powers Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Anglo American - United Kingdom
- Chamber of Mines of South Africa
- Thai Mozambique Logistica
- Mercuria Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Meralco Power Generation, Philippines
- Indian Oil Corporation Limited
- Kalimantan Lumbung Energi - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Planning Commission, India
- Commonwealth Bank - Australia
- Kepco SPC Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Kumho Petrochemical, South Korea
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- PNOC Exploration Corporation - Philippines
- Goldman Sachs - Singapore
- Carbofer General Trading SA - India
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- Binh Thuan Hamico - Vietnam
- Mjunction Services Limited - India
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- Rio Tinto Coal - Australia
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- Coastal Gujarat Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- Iligan Light & Power Inc, Philippines
- Malabar Cements Ltd - India
- White Energy Company Limited
- Straits Asia Resources Limited - Singapore
- Thiess Contractors Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Petrochimia International Co. Ltd.- Taiwan
- Heidelberg Cement - Germany
- Globalindo Alam Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Deloitte Consulting - India
- Ambuja Cements Ltd - India
- Videocon Industries ltd - India
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- Uttam Galva Steels Limited - India
- Gujarat Electricity Regulatory Commission - India
- Kohat Cement Company Ltd. - Pakistan
- Coal and Oil Company - UAE
- Parliament of New Zealand
- International Coal Ventures Pvt Ltd - India
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- ASAPP Information Group - India
- Marubeni Corporation - India
- India Bulls Power Limited - India
- Aboitiz Power Corporation - Philippines
- Ministry of Finance - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Indika Energy - Indonesia
- Jindal Steel & Power Ltd - India
- New Zealand Coal & Carbon
- Global Coal Blending Company Limited - Australia
- Orica Australia Pty. Ltd.
- Latin American Coal - Colombia
- Siam City Cement PLC, Thailand
- SMG Consultants - Indonesia
- Sojitz Corporation - Japan
- Kideco Jaya Agung - Indonesia
- Semirara Mining Corp, Philippines
- Bhatia International Limited - India
- Romanian Commodities Exchange
- Samtan Co., Ltd - South Korea
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- Therma Luzon, Inc, Philippines
- Star Paper Mills Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- Semirara Mining and Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Energy Development Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- London Commodity Brokers - England
- Vizag Seaport Private Limited - India
- Mintek Dendrill Indonesia
- Bulk Trading Sa - Switzerland
- Sindya Power Generating Company Private Ltd
- Trasteel International SA, Italy
- Timah Investasi Mineral - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Riau Bara Harum - Indonesia
- Attock Cement Pakistan Limited
- Pipit Mutiara Jaya. PT, Indonesia
- Interocean Group of Companies - India
- AsiaOL BioFuels Corp., Philippines
- IEA Clean Coal Centre - UK
- Kartika Selabumi Mining - Indonesia
- Electricity Authority, New Zealand
- Toyota Tsusho Corporation, Japan
- Coalindo Energy - Indonesia
- Xindia Steels Limited - India
- Electricity Generating Authority of Thailand
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Lanco Infratech Ltd - India
- Vedanta Resources Plc - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Indonesian Coal Mining Association
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- South Luzon Thermal Energy Corporation
- Posco Energy - South Korea
- Medco Energi Mining Internasional
- SMC Global Power, Philippines
- Global Business Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- LBH Netherlands Bv - Netherlands
- Indian Energy Exchange, India
- Dalmia Cement Bharat India
- The University of Queensland
- The Treasury - Australian Government
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