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Friday, 13 November 20
SHIPPING OUTLOOK TURNS STABLE ON EBITDA GROWTH, IMPROVING SUPPLY-DEMAND BALANCE - MOODY’S
 Outlook revised to stable from negative.
The global shipping industry is on course to perform better overall than we had previously expected this year. We expect the aggregate EBITDA of the shipping companies we rate globally to grow by 3%-5% in 2021, driven by a recovery in the dry bulk segment from pandemic lows and the continuance of good market fundamentals for container shipping. However, this is tempered by a likely decline in EBITDA in the tanker segment next year because of tough comparisons with record charter rates in the first half of 2020. The industry’s overall supply-demand balance is set to improve in 2021, which is the other main reason for the outlook change. However, risks remain. A tenuous global economic recovery has taken hold but ongoing pandemic fears and a resurgence in coronavirus infections in some major economies could hinder a recovery in demand for shipping services in 2021. Our outlook for the global shipping industry had been negative since March 2020.
Limited supply of new vessels and capacity management should act as a cushion to adverse market conditions.
Order books for all three shipping segments remain at record low levels in relation to their total fleets. As Exhibit 2 shows, even absent a real recovery or demand contracting moderately, the different segments would see limited growth in new capacity. In the container shipping segment, carriers could resume cancellations of sailings to reduce capacity to match demand. However, the tanker and dry bulk markets will be more sensitive to changes in demand during 2021 because they are much more fragmented than the global container market where capacity is partly organised through alliances.
Our view for the container shipping segment has changed to stable from negative. Following very disciplined capacity management by carriers, low bunker prices and increasing freight rates as demand recovered in the second half of 2020, the container shipping industry will record one of its strongest years since 2010. With supply and demand likely to be in balance given the very limited order book for new vessels, we expect a stable operating environment in 2021. Even if the global economic recovery takes longer to materialise, given the rising infections in Europe and the US, carriers’ capacity management should continue to keep freight rates broadly stable.
Our view for the dry bulk segment has changed to stable from negative. This is anchored in our expectations that the trough for dry bulk shipping companies likely happened during the second quarter of 2020 and that the market environment should gradually improve over the next 12-18 months. The recovery in key dry-bulk commodities has been more or less driven by China, where import volumes of iron ore were 11% higher in the year to date to August than in the same period in 2019. The supplydemand balance is also set to improve. Assuming the global economy recovers in 2021, we foresee dry bulk demand growing by 3%-5% versus supply growth ranging from 0.5% to 2%, depending on the level of scrapping activity and order delays/cancellations. Still, downside risks are certainly evident, including protracted lockdowns that would curb demand.
Our view for the tanker segment has changed to negative from stable. Tanker operators had a very strong first half of the year as the mix of a sudden collapse in oil prices and maintained production resulted in high demand for floating storage, particularly for very large crude carriers (VLCCs). As a result, charter rates reached record highs in the March to May period this year, but have weakened since with recent VLCC rates around half of the peak levels earlier this year. A substantial part of the fleet remains in floating storage or idle, a temporary effect that is likely to reverse, although a reversal may also result in higher scrapping. While oil demand continues to recover, fleet order books remain manageable and charter rates may seasonally rise in the fourth quarter of 2020, we believe that EBITDA in this shipping segment will contract in 2021 as the as the exceptional Q2 environment is unlikely to be repeated.
What could change the outlook. We would consider revising the outlook to positive if both the oversupply of vessels declines materially and comparable year-over-year EBITDA growth appears likely to exceed 10%. We would consider changing the outlook to negative if we see signs that shipping supply growth will exceed demand growth by more than 2% or that comparable EBITDA will decline by more than 5% year over year
Since outlooks represent our forward-looking view on business conditions that factor into our ratings, a negative (positive) outlook suggests that negative (positive) rating actions are more likely on average. However, the industry outlook does not represent a sum of upgrades, downgrades or ratings under review, or an average of the rating outlooks of issuers in the industry, but rather our assessment of the main direction of business fundamentals within the overall industry.
Source: Moody’s
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Tuesday, 08 December 20
MARKET ANALYSIS - ALLIED SHIPPING
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Tuesday, 08 December 20
PANAMAX: THE OVERALL MARKET SEEMS TO BE UNDER NEGATIVE PRESSURE - ALLIED
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Friday, 04 December 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Friday, 04 December 20
THE INDONESIA COAL PRICE REFERENCE REACHES THREE MONTH HIGH ON IMPROVING DEMAND OUTLOOK
COALspot.com: The Indonesia Coal Price Reference reaches three month high on improving demand outlook . The Indonesia Coal Price Reference rose by& ...
Wednesday, 02 December 20
GLOBAL MINING SECTOR OUTLOOK STABLE DUE TO CHINA'S RECOVERY - FITCH RATINGS
China’s post-pandemic economic recovery and sizeable infrastructure-focused government stimulus boosted global metals and mining prices, help ...
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- Billiton Holdings Pty Ltd - Australia
- Mintek Dendrill Indonesia
- Makarim & Taira - Indonesia
- Barasentosa Lestari - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Binh Thuan Hamico - Vietnam
- London Commodity Brokers - England
- The University of Queensland
- South Luzon Thermal Energy Corporation
- Siam City Cement - Thailand
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- Bukit Baiduri Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Economic Council, Georgia
- Coal and Oil Company - UAE
- San Jose City I Power Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Trasteel International SA, Italy
- European Bulk Services B.V. - Netherlands
- Africa Commodities Group - South Africa
- Gujarat Mineral Development Corp Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Wood Mackenzie - Singapore
- Uttam Galva Steels Limited - India
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- Georgia Ports Authority, United States
- Commonwealth Bank - Australia
- ASAPP Information Group - India
- Cigading International Bulk Terminal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Energy Development Corp, Philippines
- Dalmia Cement Bharat India
- Planning Commission, India
- Vijayanagar Sugar Pvt Ltd - India
- Kumho Petrochemical, South Korea
- IHS Mccloskey Coal Group - USA
- MS Steel International - UAE
- Singapore Mercantile Exchange
- Bulk Trading Sa - Switzerland
- Bayan Resources Tbk. - Indonesia
- SMG Consultants - Indonesia
- Siam City Cement PLC, Thailand
- Global Business Power Corporation, Philippines
- McConnell Dowell - Australia
- Straits Asia Resources Limited - Singapore
- Videocon Industries ltd - India
- Mercator Lines Limited - India
- Therma Luzon, Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Sojitz Corporation - Japan
- Bangladesh Power Developement Board
- Rashtriya Ispat Nigam Limited - India
- AsiaOL BioFuels Corp., Philippines
- Sindya Power Generating Company Private Ltd
- Larsen & Toubro Limited - India
- SN Aboitiz Power Inc, Philippines
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- Indonesian Coal Mining Association
- Eastern Coal Council - USA
- Cement Manufacturers Association - India
- Baramulti Group, Indonesia
- Bharathi Cement Corporation - India
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- PTC India Limited - India
- PNOC Exploration Corporation - Philippines
- Eastern Energy - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Xindia Steels Limited - India
- Electricity Authority, New Zealand
- Wilmar Investment Holdings
- Petrochimia International Co. Ltd.- Taiwan
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Coastal Gujarat Power Limited - India
- Coalindo Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- Mercuria Energy - Indonesia
- Petron Corporation, Philippines
- Merrill Lynch Commodities Europe
- Pipit Mutiara Jaya. PT, Indonesia
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- Semirara Mining Corp, Philippines
- Electricity Generating Authority of Thailand
- Attock Cement Pakistan Limited
- Marubeni Corporation - India
- Riau Bara Harum - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Kartika Selabumi Mining - Indonesia
- Antam Resourcindo - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Krishnapatnam Port Company Ltd. - India
- GVK Power & Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Oldendorff Carriers - Singapore
- Vedanta Resources Plc - India
- IEA Clean Coal Centre - UK
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Central Electricity Authority - India
- Bhoruka Overseas - Indonesia
- Metalloyd Limited - United Kingdom
- ICICI Bank Limited - India
- Essar Steel Hazira Ltd - India
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Posco Energy - South Korea
- Bhushan Steel Limited - India
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
- GN Power Mariveles Coal Plant, Philippines
- India Bulls Power Limited - India
- Banpu Public Company Limited - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Commodity Traders Exchange
- VISA Power Limited - India
- Ind-Barath Power Infra Limited - India
- Aditya Birla Group - India
- Star Paper Mills Limited - India
- SMC Global Power, Philippines
- Formosa Plastics Group - Taiwan
- Parry Sugars Refinery, India
- LBH Netherlands Bv - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Renaissance Capital - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Indian Oil Corporation Limited
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Malabar Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Bahari Cakrawala Sebuku - Indonesia
- Sarangani Energy Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Bhatia International Limited - India
- Independent Power Producers Association of India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Latin American Coal - Colombia
- Power Finance Corporation Ltd., India
- Gujarat Sidhee Cement - India
- GAC Shipping (India) Pvt Ltd
- Thai Mozambique Logistica
- Semirara Mining and Power Corporation, Philippines
- Borneo Indobara - Indonesia
- Madhucon Powers Ltd - India
- Sakthi Sugars Limited - India
- Minerals Council of Australia
- Ceylon Electricity Board - Sri Lanka
- CIMB Investment Bank - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maheswari Brothers Coal Limited - India
- Gujarat Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Heidelberg Cement - Germany
- Jorong Barutama Greston.PT - Indonesia
- Port Waratah Coal Services - Australia
- Sical Logistics Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Meenaskhi Energy Private Limited - India
- Ministry of Transport, Egypt
- Parliament of New Zealand
- Carbofer General Trading SA - India
- Kapuas Tunggal Persada - Indonesia
- Jindal Steel & Power Ltd - India
- Goldman Sachs - Singapore
- Directorate Of Revenue Intelligence - India
- Karaikal Port Pvt Ltd - India
- Edison Trading Spa - Italy
- Ministry of Finance - Indonesia
- Altura Mining Limited, Indonesia
- CNBM International Corporation - China
- Tamil Nadu electricity Board
- Pendopo Energi Batubara - Indonesia
- Indian Energy Exchange, India
- Miang Besar Coal Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Indika Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Salva Resources Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Grasim Industreis Ltd - India
- Anglo American - United Kingdom
- Energy Link Ltd, New Zealand
- Deloitte Consulting - India
- Orica Mining Services - Indonesia
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Savvy Resources Ltd - HongKong
- New Zealand Coal & Carbon
- TNB Fuel Sdn Bhd - Malaysia
- Price Waterhouse Coopers - Russia
- Ministry of Mines - Canada
- Manunggal Multi Energi - Indonesia
- Central Java Power - Indonesia
- Interocean Group of Companies - India
- Australian Coal Association
- Mjunction Services Limited - India
- Samtan Co., Ltd - South Korea
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