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Monday, 20 February 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU
 The dry market experienced one more disappointing week with tonnage oversupply and limited cargo demand that pushes earnings for shipping players to levels near or below operating expenses. The Baltic Dry Index closed at 717 points on Friday of February 17th, gaining only two points more than the previous week’s closing and it is now standing 55 points above from the historical low level in the last 26 years of 662 points on February 1st. The dry market normally shows a plunge at the beginning of every year as Chinese festivities bring a lull in iron ore buying activity with the BDI finding its pace upon the return from holidays. However, the index now seems that struggles to keep a steady pace of growth since it is still below the psychological barrier of 1,000 points and it is unquestionable if would surpass this level till the end of February. Following its positive upward movement in the previous week by gaining 68 points more on a weekly basis and panamaxes being the best performers, the sentiment is again distrustful with capesize earnings being extremely flat and handysizes showing a stronger resilience this week.
The BHSI showed a 3.5% week-on-week increase in contrast with a 1.8% week-on-week fall in the BPI from its 39.5% remarkable increase in the week ending February 10th. Overall, the BDI showed a minimal rise of 0.2% on a weekly basis by falling for the last three consecutive days of the week and ending to loose 12 points from the high of 729 points at the beginning of the week. Average time charter earnings for all vessel sizes are still floating at low levels, below $10,000/day, with increased worries for a prompt revival before the end of the first quarter of the year. Panamax and supramax vessels seem to have a better outlook to break the barrier of $10,000/day by earning ground from a strong Chinese coal demand, while capesizes may suffer for a longer period of time since the Chinese iron ore buying appetite, the main driver for healthier capesize earnings, is still fragile.
For large size vessels, capesizes, the market was extremely flat with the BCI gaining only 4 points more at the end of the week by closing at 1461 points, up by 0.27% on a weekly basis. The Atlantic market remains particular inactive despite some iron ore activity from Western Australia. W Australia/Qingdao rates is said to have improved only slightly, to $7,70/tonne, compared to $7,60/tonne last week. In the panamax market, the week opened with a degree of optimism with the index surpassing the 1,000 points mark level, but by the end of the week it fell to 949 points, loosing 18 points, down 1.86% from previous week’s closing.
The week ended also negative for supramax owners with a retreat of decline in Atlantic supramax rates and a rise in Pacific from record lows. Owners with tonnage in the European side found almost impossible to consider the ballast option at the prevailing freight rates and bunkering expenses, while owners in the East with tonnage seem to have better chance with rates covering operating expenses. Some reasonable mineral business from Indonesia gave a substance in the segment with the BSI loosing only 4 points from previous week’s closing and ending at 641 points, down by 0.6% week-on-week basis.
The current status of China’s steel market and the high levels of iron ore inventories do not currently support massive iron ore imports enough to lift the BDI above 1,000 points and capesize earnings at the levels of more than $10,000 day.
According to Data from the General Administration of Customs, imports by China, the world’s biggest buyer of the steel making ingredient, fell 7.4% to 59,32 million tons in January from a month earlier due to the Lunar New Year holiday. Even January gives a distorted picture for Chinese buying sentiment due to National Festivities; China’s steel market remains sluggish. The China Iron and Steel Association reported that daily crude steel production averaged 1,67 million tons from January 21 to January 31. This is similar with the average daily production that occurred during January 11 to January 20, but is down significantly from last year’s record of 2,02 mt average daily production that occurred during June 21 to June 30.
Furthermore, Chinese iron ore inventories reached the alarming level of nearly 100 million mt by the beginning of February and fell to 99.97 million tons by February 13th, but it is still hefty and indicates the slump in demand for steel production in China. Due to lower demand as a result of the slowing economy and tight liquidity, steel prices have been plunging since last October, leaving steel mills with marginal profits or making losses. Major mill Angang Steel, for instance, announced a net loss of some 2.2 billion yuan for 2011 due to rising raw material costs. CISA Chairman Zhu Jimin said that the possibility of losses and meager profits for steel mills is likely to increase this year as increased costs, falling demand and financing difficulties will continue to distress the steel industry.
The hefty amount of Chinese inventories and the lower from the biggest consumer China have plunged the iron ore price last week in the lowest level since October. Ore with 62 percent content at the Chinese port of Tianjin fell 1.6 percent to $137.40 per metric ton on Thursday 16th, data from The Steel Index showed. Vale S.A., the world’s second largest miner by volume, reported a 20% fall in its net profit for the fourth quarter of last year by recording $4,67 billion compared with a $5,92 billion a year earlier, citing as primary reason the decline in the iron ore price. Vale reported quarterly sales of $14,8 billion from reduced iron ore prices and the debt crisis that caused European shipments to slump. Credit Suisse predicted in a report that tighter market conditions would continue in 2012 with iron ore prices expected to be weaker. The report stated Brazilian iron ore miners will face lower year-on-year results due to lack of volume growth and 10% lower year on year average price.
However, Australia’s mega iron ore producers are planning to boost production amid current slow Chinese steel demand. Australia supplies about 43 percent of China's iron ore imports, with most coming from BHP, Rio and Fortescue. According to Bank of America-Merrill Lynch forecasts, China's steel demand is expected to grow 6 percent in 2012 and 5.8 percent in 2013, down from the stunning 12.8 percent compound annual growth during 2008-11.
BHP Billiton Ltd., the biggest mining company, said Feb. 12 a price decline probably won’t affect plans to spend $80 billion over the next five years to boost output along with copper and coal. “The Chinese have been buying well in advance,” said Gavin Wendt, founder and senior resource analyst at Mine Life Pty in Sydney. “They like to buy these commodities when the price is low and buy it in significant volumes, essentially more than what they need and stockpile it”.
Fortescue Metals Group is under a construction program to nearly triple production to 155 million tonnes in a year after securing funding last October. Fortescue Metals Group expects iron ore prices will remain around $US140 ($A131.48) per tonne in the short-to-medium term as Chinese demand remains strong but little new supply comes onto the market.Rio Tinto also assigned $3.4 billion to expand iron ore mining in Australia, and expects its iron ore production in Australia to reach 230 million tonnes by the end of this quarter and 283 million by the end of calendar 2013.
The recent downturn of the dry market stemming mainly from slow Chinese demand does not hamper major iron ore producers that still see future in China’s buying power that could lead steel market and vessels earnings at higher levels. The question now is how the freight markets will response to a revamping of Chinese iron ore consuming at the current oversupply tonnage.
Source: Maria Bertzeletou Hellenic Shipping
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Friday, 23 February 24
STRONG OUTLOOK FOR THE TANKER MARKET IN 2024 AND BEYOND - DNV
Several factors have aligned over the past two years to create a robust and profitable market for tanker owners, which is expected to drive newbuil ...
Friday, 23 February 24
AUSTRALIAN COAL FLOWS TO ASIA HOVER ABOVE LAST YEAR’S VOLUME TONNES - SIGNAL GROUP
In the final days of February, the dry bulk freight market appeared to maintain a relatively stable momentum, particularly evident in the large ves ...
Friday, 23 February 24
RUSSIAN COAL SHIPMENTS FALL 14% AS SANCTIONS BITE - BIMCO
During the first seven weeks of 2024, Russian coal shipments have fallen 14% y/y. Volumes have gradually declined since October 2023 when logistica ...
Thursday, 22 February 24
BIMCO PUBLISHES SHIP FINANCING FORMS TO ENSURE UNINTERRUPTED USE OF SHIPS
BIMCO has published two standard Quiet Enjoyment Letters (QELs), the first standard form QELs available to the industry, to offer a tool that can e ...
Monday, 19 February 24
METALS INVESTMENT: THE DARKEST HOUR IS JUST BEFORE THE DAWN - WOOD MACKENZIE
Things often seem at their worst just before they get better. In terms of meeting our net zero 2050 scenario, we’ve reached a watershed momen ...
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Showing 31 to 35 news of total 6871 |
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- Attock Cement Pakistan Limited
- Petron Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Iligan Light & Power Inc, Philippines
- Port Waratah Coal Services - Australia
- Economic Council, Georgia
- Parliament of New Zealand
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- Chamber of Mines of South Africa
- Formosa Plastics Group - Taiwan
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- Toyota Tsusho Corporation, Japan
- Renaissance Capital - South Africa
- Mercuria Energy - Indonesia
- The State Trading Corporation of India Ltd
- Jaiprakash Power Ventures ltd
- Oldendorff Carriers - Singapore
- Trasteel International SA, Italy
- Simpson Spence & Young - Indonesia
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Thai Mozambique Logistica
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- Energy Development Corp, Philippines
- Romanian Commodities Exchange
- Kapuas Tunggal Persada - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- Medco Energi Mining Internasional
- Mjunction Services Limited - India
- Indika Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- SMG Consultants - Indonesia
- Barasentosa Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PTC India Limited - India
- India Bulls Power Limited - India
- Goldman Sachs - Singapore
- Altura Mining Limited, Indonesia
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
- Siam City Cement PLC, Thailand
- Asmin Koalindo Tuhup - Indonesia
- Eastern Coal Council - USA
- SMC Global Power, Philippines
- Kaltim Prima Coal - Indonesia
- VISA Power Limited - India
- Lanco Infratech Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Agrawal Coal Company - India
- Xindia Steels Limited - India
- Ministry of Finance - Indonesia
- Australian Coal Association
- Neyveli Lignite Corporation Ltd, - India
- Africa Commodities Group - South Africa
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Cigading International Bulk Terminal - Indonesia
- Wilmar Investment Holdings
- CIMB Investment Bank - Malaysia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- Antam Resourcindo - Indonesia
- ICICI Bank Limited - India
- Indian Oil Corporation Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Anglo American - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Indogreen Group - Indonesia
- Bhoruka Overseas - Indonesia
- Central Electricity Authority - India
- Global Business Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Bangladesh Power Developement Board
- Metalloyd Limited - United Kingdom
- Aditya Birla Group - India
- Commonwealth Bank - Australia
- Australian Commodity Traders Exchange
- Semirara Mining Corp, Philippines
- Samtan Co., Ltd - South Korea
- Chettinad Cement Corporation Ltd - India
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- Indonesian Coal Mining Association
- McConnell Dowell - Australia
- White Energy Company Limited
- Eastern Energy - Thailand
- Carbofer General Trading SA - India
- Ambuja Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Riau Bara Harum - Indonesia
- Savvy Resources Ltd - HongKong
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- Edison Trading Spa - Italy
- Maheswari Brothers Coal Limited - India
- Videocon Industries ltd - India
- Tamil Nadu electricity Board
- Sarangani Energy Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Sojitz Corporation - Japan
- Deloitte Consulting - India
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- IHS Mccloskey Coal Group - USA
- Tata Chemicals Ltd - India
- Minerals Council of Australia
- Orica Australia Pty. Ltd.
- Bhushan Steel Limited - India
- Sakthi Sugars Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Directorate General of MIneral and Coal - Indonesia
- Bukit Makmur.PT - Indonesia
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Baramulti Group, Indonesia
- Rashtriya Ispat Nigam Limited - India
- Directorate Of Revenue Intelligence - India
- Coastal Gujarat Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Electricity Authority, New Zealand
- Globalindo Alam Lestari - Indonesia
- Independent Power Producers Association of India
- GAC Shipping (India) Pvt Ltd
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Ministry of Transport, Egypt
- Singapore Mercantile Exchange
- Meralco Power Generation, Philippines
- Global Green Power PLC Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Heidelberg Cement - Germany
- Central Java Power - Indonesia
- Kumho Petrochemical, South Korea
- Merrill Lynch Commodities Europe
- Indo Tambangraya Megah - Indonesia
- Madhucon Powers Ltd - India
- Bayan Resources Tbk. - Indonesia
- Coalindo Energy - Indonesia
- Uttam Galva Steels Limited - India
- Bulk Trading Sa - Switzerland
- Vizag Seaport Private Limited - India
- Bukit Baiduri Energy - Indonesia
- Vedanta Resources Plc - India
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- Orica Mining Services - Indonesia
- Dalmia Cement Bharat India
- Energy Link Ltd, New Zealand
- Star Paper Mills Limited - India
- Cement Manufacturers Association - India
- TeaM Sual Corporation - Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Georgia Ports Authority, United States
- PNOC Exploration Corporation - Philippines
- Sical Logistics Limited - India
- Larsen & Toubro Limited - India
- Kepco SPC Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Timah Investasi Mineral - Indoneisa
- Binh Thuan Hamico - Vietnam
- Parry Sugars Refinery, India
- South Luzon Thermal Energy Corporation
- Maharashtra Electricity Regulatory Commission - India
- The University of Queensland
- Pendopo Energi Batubara - Indonesia
- Indian Energy Exchange, India
- Ceylon Electricity Board - Sri Lanka
- Planning Commission, India
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- London Commodity Brokers - England
- Sindya Power Generating Company Private Ltd
- Semirara Mining and Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- San Jose City I Power Corp, Philippines
- Sree Jayajothi Cements Limited - India
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- Essar Steel Hazira Ltd - India
- Karaikal Port Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- SN Aboitiz Power Inc, Philippines
- Grasim Industreis Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Rio Tinto Coal - Australia
- GN Power Mariveles Coal Plant, Philippines
- MS Steel International - UAE
- Borneo Indobara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- IEA Clean Coal Centre - UK
- Jorong Barutama Greston.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- Gujarat Sidhee Cement - India
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Makarim & Taira - Indonesia
- Kartika Selabumi Mining - Indonesia
- GMR Energy Limited - India
- Coal and Oil Company - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Interocean Group of Companies - India
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