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Wednesday, 03 March 21
MARKET INSIGHT - INTERMODAL
 Following the recent rally to multi year highs of metal-based commodities, amid an unprecedented global economic stimulus, discussions of an emerging commodity supercycle have gained traction recently.
Key stakeholders of our industry are debating whether this might be a beginning of a new shipping supercycle. An interesting development that could fuel further this view, is that of a potential infrastructure supercycle in the US.
A large part of the 2nd phase of the US fiscal stimulus scheme under the Biden administration, was planned to be invested in infrastructure. The chances of a large infrastructure bill have increased after the devasting winter storms two weeks ago, that resulted to billions dollar damages and reiterated the previous decade’s infrastructure underinvestment. As a candidate, Biden had proposed a $1.3 trillion investment towards infrastructure over the course of 10 years. However, with extended damages after the winter storms, the bill might end up much higher; with Goldman Sachs expecting it to reach $2 trillion or above. This will be the largest infrastructure stimulus after the New Deal and depending on the extent it materializes, it should create a material multiplier effect on demand for building materials. The targeted infrastructure, such as bridges and roads, points towards increased steel and cement demand, which will likely make these commodities the main beneficiaries over a 10 year cycle. USA’s cement production particularly is running close to max capacity utilization, which means that there will be a production shortfall if demand rises significantly. Cement production in the US came at 90 million tons in 2020, which is approx. 2.1% of the world production. Both demand for imports and cement production capacity will have to expand over the next years in order to cover domestic consumption. With the only sizeable cement/clinker producer being China (more than 50% of the global output), imports from the country and thus dry bulk ton-miles could increase materially.
The main shipping beneficiary will likely be mid-sized bulkers carrying minerals and steel, however the dominant vessel size in reality will be determined by the extent of the upward price pressure on the commodity and the need for cargo upsizing. Both steel prices (which have hit record high levels in the US recently) and cement/clinker prices, will race to the top under such stimulus multiplier and set the ceiling for international steel related commodities and thus freight higher. The last cement supercycle in the US lasted from 1990 to 2007 when cement prices had outperformed inflation; Morgan Stanley bullishly argues that “an infrastructure package could catapult building materials into a super cycle similar to the 1950s. We are 10 years into the current construction cycle, exiting a recession, and potentially facing a government-underwritten cycle of another 10 years."
It remains to be seen whether this infrastructure rebuild will be the trigger for another commodity and shipping supercycle. In any case, September 2021 is expected to be the deadline towards an approval of a new infrastructure bill and the spending won’t start until a year later, thus the impact will likely show later in 2022. The extent of the impact will also depend on how China will react to the news of such package from the US, with this week’s watch on the China’s National People Congress and the release of the country’s 14th five year plan.
By Ilias M. Lalaounis,
SnP Broker
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.
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Monday, 25 January 21
ULTRAMAX YET ANOTHER POSITIVE WEEK FOR THE SECTOR, WHICH SAW INCREASED DEMAND ACROSS ALL BASINS - BALTIC BRIEFING
Capesize
The Capesize market rocked and rolled these past few days. But by weeks end little had changed on the Capesize 5TC as it settled down ...
Monday, 25 January 21
NEW LAW IN CALIFORNIA, USA, AFFECTING SHIPOWNERS' LIABILITY FOR OIL POLLUTION - BIMCO
Members are advised that amendments to the so-called Lempert-Keene-Seastrand Oil Spill Prevention and Response Act of 1990 in the State of Californ ...
Monday, 25 January 21
COAL INDIA SAYS GEARED UP TO MEET SURGE IN FUEL DEMAND FROM POWER SECTOR - PTI
State-owned Coal India Ltd on Saturday said that it is well geared to meet any surge in demand for coal from the power sector.
The s ...
Sunday, 24 January 21
GOVT ASSURES COAL INDIA OF 'FULL SUPPORT', STRESSES ON LEARNING 'NEW THINGS' - PTI
Coal Minister Pralhad Joshi assured Coal India of full government support, even as he said the PSU needs to learn “new things” for impr ...
Saturday, 23 January 21
GOVT PLANNING TO OPEN UP COAL MARKETING TO STREAMLINE PROCESS - THE INDIAN EXPRESS
The government is considering opening up coal marketing, Coal Secretary Anil Kumar Jain said on Thursday. Currently, production by Coal India is al ...
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- Chamber of Mines of South Africa
- Global Business Power Corporation, Philippines
- Indogreen Group - Indonesia
- Gujarat Sidhee Cement - India
- Kapuas Tunggal Persada - Indonesia
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Ind-Barath Power Infra Limited - India
- Agrawal Coal Company - India
- Merrill Lynch Commodities Europe
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Antam Resourcindo - Indonesia
- The Treasury - Australian Government
- Electricity Generating Authority of Thailand
- Neyveli Lignite Corporation Ltd, - India
- Formosa Plastics Group - Taiwan
- PNOC Exploration Corporation - Philippines
- Bukit Makmur.PT - Indonesia
- Indian Energy Exchange, India
- IHS Mccloskey Coal Group - USA
- Pipit Mutiara Jaya. PT, Indonesia
- Iligan Light & Power Inc, Philippines
- Uttam Galva Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Larsen & Toubro Limited - India
- Mjunction Services Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Riau Bara Harum - Indonesia
- Carbofer General Trading SA - India
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- New Zealand Coal & Carbon
- Port Waratah Coal Services - Australia
- Malabar Cements Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Jaiprakash Power Ventures ltd
- Australian Coal Association
- Makarim & Taira - Indonesia
- Banpu Public Company Limited - Thailand
- Bharathi Cement Corporation - India
- Central Electricity Authority - India
- Bahari Cakrawala Sebuku - Indonesia
- Tamil Nadu electricity Board
- Planning Commission, India
- Central Java Power - Indonesia
- Romanian Commodities Exchange
- International Coal Ventures Pvt Ltd - India
- Interocean Group of Companies - India
- Mintek Dendrill Indonesia
- Siam City Cement PLC, Thailand
- Ambuja Cements Ltd - India
- Bayan Resources Tbk. - Indonesia
- GVK Power & Infra Limited - India
- Indonesian Coal Mining Association
- Kartika Selabumi Mining - Indonesia
- CNBM International Corporation - China
- Straits Asia Resources Limited - Singapore
- Sinarmas Energy and Mining - Indonesia
- Parry Sugars Refinery, India
- Thiess Contractors Indonesia
- GAC Shipping (India) Pvt Ltd
- Aboitiz Power Corporation - Philippines
- Edison Trading Spa - Italy
- Intertek Mineral Services - Indonesia
- Oldendorff Carriers - Singapore
- Medco Energi Mining Internasional
- Singapore Mercantile Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Thai Mozambique Logistica
- Savvy Resources Ltd - HongKong
- Timah Investasi Mineral - Indoneisa
- Therma Luzon, Inc, Philippines
- Mercator Lines Limited - India
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- Baramulti Group, Indonesia
- Barasentosa Lestari - Indonesia
- McConnell Dowell - Australia
- SN Aboitiz Power Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Energy Link Ltd, New Zealand
- AsiaOL BioFuels Corp., Philippines
- Orica Australia Pty. Ltd.
- Grasim Industreis Ltd - India
- Sree Jayajothi Cements Limited - India
- Georgia Ports Authority, United States
- Parliament of New Zealand
- Essar Steel Hazira Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Bhatia International Limited - India
- Leighton Contractors Pty Ltd - Australia
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Commonwealth Bank - Australia
- White Energy Company Limited
- CIMB Investment Bank - Malaysia
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Tata Chemicals Ltd - India
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- Bhushan Steel Limited - India
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- SMG Consultants - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- Simpson Spence & Young - Indonesia
- Attock Cement Pakistan Limited
- Rashtriya Ispat Nigam Limited - India
- Semirara Mining Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Africa Commodities Group - South Africa
- Vedanta Resources Plc - India
- Heidelberg Cement - Germany
- Orica Mining Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Metalloyd Limited - United Kingdom
- San Jose City I Power Corp, Philippines
- Rio Tinto Coal - Australia
- Ministry of Transport, Egypt
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GMR Energy Limited - India
- ASAPP Information Group - India
- Dalmia Cement Bharat India
- Coastal Gujarat Power Limited - India
- Price Waterhouse Coopers - Russia
- Miang Besar Coal Terminal - Indonesia
- Bulk Trading Sa - Switzerland
- European Bulk Services B.V. - Netherlands
- Directorate General of MIneral and Coal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Renaissance Capital - South Africa
- Minerals Council of Australia
- Alfred C Toepfer International GmbH - Germany
- Jindal Steel & Power Ltd - India
- Videocon Industries ltd - India
- Siam City Cement - Thailand
- Bukit Baiduri Energy - Indonesia
- Indika Energy - Indonesia
- Trasteel International SA, Italy
- Sical Logistics Limited - India
- PTC India Limited - India
- The University of Queensland
- Goldman Sachs - Singapore
- Meralco Power Generation, Philippines
- India Bulls Power Limited - India
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Anglo American - United Kingdom
- Bangladesh Power Developement Board
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- VISA Power Limited - India
- Wilmar Investment Holdings
- Gujarat Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- Lanco Infratech Ltd - India
- Xindia Steels Limited - India
- Indian Oil Corporation Limited
- IEA Clean Coal Centre - UK
- Kalimantan Lumbung Energi - Indonesia
- Vizag Seaport Private Limited - India
- Deloitte Consulting - India
- Marubeni Corporation - India
- Gujarat Mineral Development Corp Ltd - India
- Sarangani Energy Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Star Paper Mills Limited - India
- Posco Energy - South Korea
- OPG Power Generation Pvt Ltd - India
- Economic Council, Georgia
- Toyota Tsusho Corporation, Japan
- Ministry of Mines - Canada
- TNB Fuel Sdn Bhd - Malaysia
- Manunggal Multi Energi - Indonesia
- Kumho Petrochemical, South Korea
- ICICI Bank Limited - India
- Sakthi Sugars Limited - India
- South Luzon Thermal Energy Corporation
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- MS Steel International - UAE
- Asmin Koalindo Tuhup - Indonesia
- Madhucon Powers Ltd - India
- Meenaskhi Energy Private Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Cement Manufacturers Association - India
- Kobexindo Tractors - Indoneisa
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- London Commodity Brokers - England
- Binh Thuan Hamico - Vietnam
- TeaM Sual Corporation - Philippines
- Energy Development Corp, Philippines
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- Sojitz Corporation - Japan
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
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