We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Wednesday, 19 August 20
MARKET INSIGHT - GEORGE LAIOS | INTERMODAL
 Since the Covid-19 outbreak, governments and central banks around the globe have been using their ammunition and stimulus packages to keep their economies running. Trillions have been injected into global economies to fight unemployment and minimize recession. Apart from the central banks of EU, Japan, Switzerland, Sweden and Denmark, who have been offering negative rates for the past five years – a handful of central banks have now reduced their policy rates to near-zero values. Regardless of how successful or not the above mentioned five banks’ “experiment’’ has been, negative rates have undoubtedly made hedging strategies more complicated.
When it comes to the US Dollar, the Fed Chair has made it clear that negative rates are not part of its policy tools for the time being and that it is highly unlikely that rates will be pushed below zero. However, the US President has openly expressed that he views such a tool favourably. Although market experts do not expect negative Libor rates in the imminent future, no one can rule out the possibility of this happening.
These developments have had numerous effects on shipping companies who typically borrow using USD-Libor floating loans. The first and obvious outcome of lower Libor is the reduced borrowing cost. Whilst average 3-month LIBOR rates were 0.69%, 0.74% and 0.95% during the 2009, 2016 and 2020 (to date) recessions respectively, the 3-month LIBOR rate in July closed at 0.3% and has decreased approximately 6-fold since January (0.25%, as of 17/8). USD Libor loans have a zero lower bound limit which is incorporated by banks in their loan documentation (LMA) language: if Libor is less than zero “it will be deemed to be zero’’. This wording is also included in proposed documentation by the Alternative Reference Rates Committee, who is responsible for the development of Libor’s successor.
Low interest rates have also resulted in increased enquiries from bank clients who want to exploit their interest rate hedging options. Most shipping borrowers have decided not to hedge owing to the consensus that USD interest rates will not increase significantly over the next couple of years. Nevertheless, the number of shipping companies (mainly listed) that have engaged in hedging derivatives remain significant.
Under “normal” circumstances, a Cap or a SWAP for protection against an upward movement of interest rates would be the norm. However, nowadays it is essential to provision for negative interest rates. The borrower who hedges should bear in mind that USD Libor can also turn negative. Some banks even “encourage” clients to include a Floor in their SWAPS which will prevent base rates on their loans from dropping below zero. This limits the extent to which their derivatives can fall “out of the money”. Such protection comes at a premium. Indicatively, a 5 year SWAP is priced at 0.37 %, while the cost of a Floor is [10-30] bps. With rates expected to remain close to zero, the SWAP protection premium will continue to rise for as long as there are statements in favour of negative rates such as that of President Trump. However, whether the cost of protecting of a company’s future cash flows through the xyz premium is high or not is also a matter of perception and is reflective of one’s risk profile.
By George Laios
Deputy CEO, Intermodal Group
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms Eva Tzima
Mr.George Panagopoulos
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
The Information contained within the website of COALspot.com is intended for informational purposes only and is not intended as professional counsel and should not be used as such.
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Wednesday, 19 August 20
COAL INDIA TRADE UNIONS DEFER DAY-LONG STRIKE: PTI
The unions had decided to go on strike against the commercial mining and the proposed divestment or buyback of shares of Coal India Ltd (CIL).
...
Wednesday, 19 August 20
MISC MARKS ITS MAIDEN FORAY INTO MAJOR DEEP-WATER PROJECT IN LATIN AMERICA WITH MERO 3 FPSO
MISC Berhad (MISC) is pleased to announce its acceptance of Letter of Intent (LOI) from Petróleo Brasileiro S.A. (Petrobras) for the provisi ...
Wednesday, 19 August 20
INDIA SAW A SHARP DECLINE IN ENERGY COAL IMPORTS IN JANUARY - JUNE 2020; –27 PER CENT YOY - BHP
Energy coal prices were weak in the second half of financial year 2020, BHP says in its Economic and Commodity Outlook FY20.
Accordi ...
Wednesday, 19 August 20
COAL PRICES TO REMAIN SUBDUED THIS FISCAL AMID WEAK DEMAND, HIGH INVENTORY - THE HINDU BUSINESS LINE
Coal offtake is improving gradually as lockdown eases
Coal prices are expected to remain subdued to weak demand and high inventory l ...
Tuesday, 18 August 20
BLACKBALLED: WILL COAL BOUNCE BACK FROM SLUMP OR IS IT TERMINAL? - SYDNEY MORNING HERALD
Even by the standards of this miserable year, 2020 has been a shocker for the global coal industry.
As the lockdown kicked in demand ...
|
|
|
Showing 826 to 830 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- PowerSource Philippines DevCo
- McConnell Dowell - Australia
- PetroVietnam Power Coal Import and Supply Company
- Antam Resourcindo - Indonesia
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Directorate Of Revenue Intelligence - India
- The State Trading Corporation of India Ltd
- Metalloyd Limited - United Kingdom
- Alfred C Toepfer International GmbH - Germany
- Mercuria Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- India Bulls Power Limited - India
- Australian Coal Association
- Timah Investasi Mineral - Indoneisa
- Kideco Jaya Agung - Indonesia
- Ministry of Finance - Indonesia
- Planning Commission, India
- PNOC Exploration Corporation - Philippines
- Edison Trading Spa - Italy
- Bukit Makmur.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Larsen & Toubro Limited - India
- Kobexindo Tractors - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Marubeni Corporation - India
- Uttam Galva Steels Limited - India
- VISA Power Limited - India
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- Independent Power Producers Association of India
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- Makarim & Taira - Indonesia
- Samtan Co., Ltd - South Korea
- Posco Energy - South Korea
- AsiaOL BioFuels Corp., Philippines
- Global Business Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Savvy Resources Ltd - HongKong
- Commonwealth Bank - Australia
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Videocon Industries ltd - India
- New Zealand Coal & Carbon
- Petrochimia International Co. Ltd.- Taiwan
- Thiess Contractors Indonesia
- Central Java Power - Indonesia
- Ministry of Transport, Egypt
- Electricity Authority, New Zealand
- SMC Global Power, Philippines
- Leighton Contractors Pty Ltd - Australia
- Thai Mozambique Logistica
- Tamil Nadu electricity Board
- Bulk Trading Sa - Switzerland
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Africa Commodities Group - South Africa
- Gujarat Mineral Development Corp Ltd - India
- Pendopo Energi Batubara - Indonesia
- Iligan Light & Power Inc, Philippines
- Vedanta Resources Plc - India
- Standard Chartered Bank - UAE
- Star Paper Mills Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Rio Tinto Coal - Australia
- TeaM Sual Corporation - Philippines
- Mintek Dendrill Indonesia
- San Jose City I Power Corp, Philippines
- Coal and Oil Company - UAE
- Carbofer General Trading SA - India
- Maheswari Brothers Coal Limited - India
- Medco Energi Mining Internasional
- Meenaskhi Energy Private Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Mining Services - Indonesia
- White Energy Company Limited
- Eastern Energy - Thailand
- Coalindo Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Sojitz Corporation - Japan
- Madhucon Powers Ltd - India
- CNBM International Corporation - China
- Sical Logistics Limited - India
- Mercator Lines Limited - India
- Neyveli Lignite Corporation Ltd, - India
- GMR Energy Limited - India
- Singapore Mercantile Exchange
- Sakthi Sugars Limited - India
- Australian Commodity Traders Exchange
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Toyota Tsusho Corporation, Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Deloitte Consulting - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Lanco Infratech Ltd - India
- Therma Luzon, Inc, Philippines
- Siam City Cement PLC, Thailand
- Sarangani Energy Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Global Coal Blending Company Limited - Australia
- Jaiprakash Power Ventures ltd
- Indogreen Group - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Anglo American - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- PTC India Limited - India
- Bangladesh Power Developement Board
- Trasteel International SA, Italy
- Port Waratah Coal Services - Australia
- Ceylon Electricity Board - Sri Lanka
- Wilmar Investment Holdings
- SMG Consultants - Indonesia
- London Commodity Brokers - England
- Cigading International Bulk Terminal - Indonesia
- Ambuja Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Coastal Gujarat Power Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Straits Asia Resources Limited - Singapore
- Ind-Barath Power Infra Limited - India
- Bhoruka Overseas - Indonesia
- Kepco SPC Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Ministry of Mines - Canada
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Barasentosa Lestari - Indonesia
- The University of Queensland
- Borneo Indobara - Indonesia
- Siam City Cement - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Baiduri Energy - Indonesia
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- Agrawal Coal Company - India
- IHS Mccloskey Coal Group - USA
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- International Coal Ventures Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Essar Steel Hazira Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Bayan Resources Tbk. - Indonesia
- SN Aboitiz Power Inc, Philippines
- Semirara Mining Corp, Philippines
- Minerals Council of Australia
- Salva Resources Pvt Ltd - India
- Attock Cement Pakistan Limited
- Kartika Selabumi Mining - Indonesia
- Cement Manufacturers Association - India
- MS Steel International - UAE
- Petron Corporation, Philippines
- Indian Energy Exchange, India
- IEA Clean Coal Centre - UK
- Latin American Coal - Colombia
- Power Finance Corporation Ltd., India
- GAC Shipping (India) Pvt Ltd
- Indika Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Global Green Power PLC Corporation, Philippines
- Grasim Industreis Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Heidelberg Cement - Germany
- Georgia Ports Authority, United States
- Central Electricity Authority - India
- Oldendorff Carriers - Singapore
- South Luzon Thermal Energy Corporation
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- Riau Bara Harum - Indonesia
- Aboitiz Power Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Mjunction Services Limited - India
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- Bhatia International Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Aditya Birla Group - India
- Indonesian Coal Mining Association
- Karbindo Abesyapradhi - Indoneisa
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- Parry Sugars Refinery, India
- Dalmia Cement Bharat India
- Energy Development Corp, Philippines
- Binh Thuan Hamico - Vietnam
- Indo Tambangraya Megah - Indonesia
- Goldman Sachs - Singapore
- GN Power Mariveles Coal Plant, Philippines
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- Karaikal Port Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Kapuas Tunggal Persada - Indonesia
- Eastern Coal Council - USA
- Bahari Cakrawala Sebuku - Indonesia
- Merrill Lynch Commodities Europe
- Gujarat Sidhee Cement - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parliament of New Zealand
- Intertek Mineral Services - Indonesia
|
| |
| |
|
