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Thursday, 13 January 11
DRY BULK RATES HIT NEW MULTI-MONTH LOWS ON AUSTRALIAS FLOODS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 Floods in Australia’s Queensland has seriously disrupted coal shipments and together with a flood of vessels has pushed freight rates for dry bulk carriers to new multi-month lows. As a result, the Baltic Dry Index fell further yesterday to just 1,453 points, losing 1.82% on the day, while the suffering Capesize segment retreated by a further 4.77%.
The BDI has now recorded 21 straight losing sessions, losing almost 34% of its value. According to calculations from John Cotzias, head of N.Cotzias Shipping Group, in 58 sessions spanning at just less of three months, there have been only 10 days, during which the index was positive.
“The Cape index is counting 12 falling days and has overall lost in this period close to 40% of its volume. BDI is currently below levels of 5 Feb 2009 when the index was rising” said Mr. Cotzias. The market hasn’t seen such low levels since November of 2002, except of course the October 2008 market crash.
In a separate analysis, BIMCO’s shipping analyst Peter Sand said that all in all – the worst flooding in Queensland for more than 50 years “is not only bad for Australia, it's also bad for shipping as volumes on coal and iron ore go down considerably - and more vessels are free on the market putting pressure on the spot market for vessels. Average Capesize time charter rate that has been falling since end of November is now down at USD 11,266 per day trading lower every day” said Sand. He went on to state that iron ore which is exported out of West Australia is not directly affected yet even though that area has received much rain also. Lower steel production and thus also lower seaborne volumes of the two key dry bulk commodities is set to impact the market negatively over the next months. Australia is the world's largest overall coal exporter ,No. 2 in thermal coal exports after Indonesia but second to none in coking coal exports. Australia is key global coking coal supplier accounting for 60% of global seaborne exports. Within thermal coal Australia accounts for 20%. Thermal coal is used for power generation and heating, while coking coal is used in the production steel. As we have already seen, coal customers will try to find other ways to satisfy their demand for thermal coal but the real trouble is coking coal - as it is very hard to get from elsewhere. Shortage of Australian coking coal means that the worlds steel producers, primarily located in Asia, can be forced to cut the production of steel and with it also the demand for iron ore. ”A slowdown in steel production and iron ore demand is toxic to dry bulk shipping in general and for the larger vessels, Capesize and Panamax in particular. The iron ore contract prices for Q1-2011 have already been set at 7% higher than the previous quarter - but spot iron ore prices can still fluctuate and will move south on lower demand. China imports 40-50% of its coking coal from Australia. Japan, the world’s largest coking coal importer is heavily impacted also. The flooding may see contract prices for coking coal hiking significantly due to spot prices going sharply up as a result of the tight market. A part of the mechanism behind the contract prices is the spot price development. This may result in coking coal prices moving from USD 225 per tonnes in Q1-2011 up to USD 270-300 per tonnes according to several commodity analysts.
When the mines call force majeure - the steel mills must go to the spot market for coking coal - at a much higher price than the contract price for this important steel production ingredient - if they can get it at all. Alternative sources of coking coal are the US and Canada but reports are that the tight market has impacted prices also there, leading to higher commodity prices. So if coking coal spot goes up on tight supply - iron ore spot price can go down as a consequence of lower demand. A price hike in coking coal will increase the
production cost for steel - in a market already running on low margins” said BIMCO’s analyst.
So where will it go from here? “It is a string of events that cause shipping demand out of Australia to go down. Moreover the market place is plentifully supplied with tonnage so the fact that some of the commodities will be supplied from sources further away will only have very limited impact on the market. The first quarter of 2011 - do not hold great prospects for the dry bulk market - mainly because the oversupply of vessels is getting too heavy even for the "normal" inefficiencies of the market to make impact on the freight rates. The Australian situation is set to affect the market for at least a of couple months - meaning that the situation outlined above will stay a drag on the overall market and freight rates for some time” concluded Sand.
Talking about the potential overcapacity, Cotzias said that there is a total of over 3,500 dry bulk carriers on order pending until 2014 of a total of 250 million tons dwt. “These orders are split chronologically as follows: 1,854 ships are due for 2011 making up a total of 128 mil dwt, 1,106 ships due in 2012 of 87 mil dwt and 360 ships of 30 mil dwt due for 2013-2014. In total there is a massive orderbook only on the Bulkers section and we should not understate the fact that 2011 faces us with more than 55% of the total orderbook and that we should also include in this 114 orders of 4mil dwt that are “carried forward” from 2010”.
Source: Nikos Roussanoglou, Hellenic Shipping
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Wednesday, 07 October 20
U.S. COAL PRODUCTION TO DECREASE BY 26 PERCENT IN 2020 COMPARED TO 2019 - EIA
EIA expects total U.S. coal production in 2020 to be 525 million short tons (MMst), compared with 705 MMst in 2019, a 26% decrease.
COVID-19 a ...
Wednesday, 07 October 20
MARKET INSIGHT - INTERMODAL
The challenges brought forward in 2020 proved to be very different from what we could have ever imagined. Together with placing a significant strai ...
Tuesday, 06 October 20
KOSPO TO IMPORT 80,000 MT OF 3,800 NCV COAL FOR 2H NOV
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 80,000 MT Min.3800 kcal/kg NCV coal 2H November, 2020 l ...
Friday, 02 October 20
THE INDONESIA COAL PRICE REFERENCE RISE AFTER HISTORIC CRASH TO US$ 49.42
COALspot.com: The Indonesia Coal Price Reference for the month of October Rise to US$ 51.00 after historic crash to US$ 49.42 in September 2020.
...
Friday, 02 October 20
SRI LANKA MUST LEARN LESSONS FROM AROUND ASIA TO AVOID FURTHER ELECTRICITY CRISES - IEEFA
Overcommitment to fossil-fuelled power generation is leading to excess capacity and rising capacity payments, subsidies, and tariffs around the con ...
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- Bhatia International Limited - India
- Uttam Galva Steels Limited - India
- Orica Australia Pty. Ltd.
- Singapore Mercantile Exchange
- Siam City Cement PLC, Thailand
- Trasteel International SA, Italy
- Iligan Light & Power Inc, Philippines
- Wilmar Investment Holdings
- Coalindo Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Petrochimia International Co. Ltd.- Taiwan
- Rashtriya Ispat Nigam Limited - India
- Baramulti Group, Indonesia
- PowerSource Philippines DevCo
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- SMC Global Power, Philippines
- Therma Luzon, Inc, Philippines
- Banpu Public Company Limited - Thailand
- Merrill Lynch Commodities Europe
- Vedanta Resources Plc - India
- White Energy Company Limited
- Vizag Seaport Private Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Aditya Birla Group - India
- Ministry of Mines - Canada
- Ceylon Electricity Board - Sri Lanka
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Krishnapatnam Port Company Ltd. - India
- The State Trading Corporation of India Ltd
- Indian Energy Exchange, India
- Tata Chemicals Ltd - India
- Electricity Authority, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Pendopo Energi Batubara - Indonesia
- Dalmia Cement Bharat India
- IEA Clean Coal Centre - UK
- Mercator Lines Limited - India
- IHS Mccloskey Coal Group - USA
- Electricity Generating Authority of Thailand
- Energy Development Corp, Philippines
- Madhucon Powers Ltd - India
- Thai Mozambique Logistica
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Bukit Baiduri Energy - Indonesia
- Grasim Industreis Ltd - India
- Central Java Power - Indonesia
- Parry Sugars Refinery, India
- Independent Power Producers Association of India
- ICICI Bank Limited - India
- Africa Commodities Group - South Africa
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- Metalloyd Limited - United Kingdom
- South Luzon Thermal Energy Corporation
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Kohat Cement Company Ltd. - Pakistan
- Minerals Council of Australia
- Bhoruka Overseas - Indonesia
- Formosa Plastics Group - Taiwan
- Timah Investasi Mineral - Indoneisa
- VISA Power Limited - India
- Meralco Power Generation, Philippines
- Central Electricity Authority - India
- Bangladesh Power Developement Board
- Coal and Oil Company - UAE
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- CNBM International Corporation - China
- Straits Asia Resources Limited - Singapore
- Xindia Steels Limited - India
- Carbofer General Trading SA - India
- Coastal Gujarat Power Limited - India
- Indika Energy - Indonesia
- Ministry of Transport, Egypt
- Holcim Trading Pte Ltd - Singapore
- Cement Manufacturers Association - India
- CIMB Investment Bank - Malaysia
- Petron Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Kepco SPC Power Corporation, Philippines
- Star Paper Mills Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- Karbindo Abesyapradhi - Indoneisa
- TeaM Sual Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- Sical Logistics Limited - India
- Bayan Resources Tbk. - Indonesia
- Directorate Of Revenue Intelligence - India
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Salva Resources Pvt Ltd - India
- London Commodity Brokers - England
- Energy Link Ltd, New Zealand
- Goldman Sachs - Singapore
- Meenaskhi Energy Private Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mercuria Energy - Indonesia
- Planning Commission, India
- Sree Jayajothi Cements Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Siam City Cement - Thailand
- Toyota Tsusho Corporation, Japan
- MS Steel International - UAE
- Economic Council, Georgia
- Australian Commodity Traders Exchange
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Global Green Power PLC Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Coal Association
- Kartika Selabumi Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- Aboitiz Power Corporation - Philippines
- Kobexindo Tractors - Indoneisa
- Renaissance Capital - South Africa
- Antam Resourcindo - Indonesia
- Chamber of Mines of South Africa
- European Bulk Services B.V. - Netherlands
- PNOC Exploration Corporation - Philippines
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- Bhushan Steel Limited - India
- AsiaOL BioFuels Corp., Philippines
- Indonesian Coal Mining Association
- Posco Energy - South Korea
- Mintek Dendrill Indonesia
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Intertek Mineral Services - Indonesia
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- GVK Power & Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- SN Aboitiz Power Inc, Philippines
- PTC India Limited - India
- Makarim & Taira - Indonesia
- Riau Bara Harum - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Jaiprakash Power Ventures ltd
- Semirara Mining and Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Jindal Steel & Power Ltd - India
- India Bulls Power Limited - India
- Port Waratah Coal Services - Australia
- Jorong Barutama Greston.PT - Indonesia
- Latin American Coal - Colombia
- The University of Queensland
- Georgia Ports Authority, United States
- Altura Mining Limited, Indonesia
- Kideco Jaya Agung - Indonesia
- GAC Shipping (India) Pvt Ltd
- Maharashtra Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Billiton Holdings Pty Ltd - Australia
- Kapuas Tunggal Persada - Indonesia
- Globalindo Alam Lestari - Indonesia
- Binh Thuan Hamico - Vietnam
- Interocean Group of Companies - India
- Lanco Infratech Ltd - India
- Tamil Nadu electricity Board
- Simpson Spence & Young - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Romanian Commodities Exchange
- Cigading International Bulk Terminal - Indonesia
- GMR Energy Limited - India
- Indo Tambangraya Megah - Indonesia
- Attock Cement Pakistan Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Medco Energi Mining Internasional
- Malabar Cements Ltd - India
- Maheswari Brothers Coal Limited - India
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- ASAPP Information Group - India
- Essar Steel Hazira Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Heidelberg Cement - Germany
- Power Finance Corporation Ltd., India
- Semirara Mining Corp, Philippines
- Global Coal Blending Company Limited - Australia
- Indogreen Group - Indonesia
- Parliament of New Zealand
- OPG Power Generation Pvt Ltd - India
- Eastern Coal Council - USA
- Eastern Energy - Thailand
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Indian Oil Corporation Limited
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