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Tuesday, 11 June 13
OUTLOOK FOR CAPESIZES LOOKS GRIM, DESPITE FALLING IRON ORE PRICES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
 Things aren't looking all that rosy for the dry bulk market, despite a stronger volume of iron ore imports during the months of March and April, as freight rates haven't had that necessary push to jumpstart. According to the latest monthly report from shipbroker Intermodal, "this has been reflected in the continuous drop in price for the commodity which was on an almost free-fall course from its latest price peak of $158.9 per dry ton reached on the 20th of February. The significantly slower economic momentum of China has slashed demand for this development-linked commodity, dragging both the price as well as the freight cost to multi-month lows. This is set to continue for most of the year, with destocking still a central strategy in China", the report said.
According to Mr. George Lazaridis, Research Analyst with Intermodal, "the industry view tends to be that for the long-run, even these bottom-of-the-cycle prices are much higher than what most analysts believe should be the prevailing level. This leads to an expectation of surplus production which eventually could lead to problems in ship-ping, as sources such as South Africa increase their stake in China’s iron ore imports, slashing in turn tonne-mile demand for Capes.
The question that is of more vital importance and an ongoing topic of conversation this year amongst shipping circles is; When can we expect an improvement in market fundamentals?
The answer is looking somewhat more worrying for Capes. It will take a lot more than just cheap commodity prices to get things going again. The Chinese slowdown does not seem to be a temporary hiccup and as such people should be taking it more serious", he noted.
With China accounting last year for 47% of global steel production, there is no debate as to who drives the demand for Capes. "Being heavily dependent on Chinese heavy industry production and investment in infrastructure any further slowdown in economic growth has an imminent impact on freight rates for this sector. Without this driving demand it is hard for this segment to see the sharp rise in freight rates and secondhand prices that many had hoped we would reach within this year. Nevertheless it’s not all black. Baosteel sees a 1-2 pct increase in Chinese steel production this year. The year-to-date increase in output of 7% shows a promise for improved markets in the final quarter, while at the same time it would take a substantial slow-down in output in the second-half for there to be a year-on-year drop in Chinese steel output", Lazaridis said.
With all the above in mind a few questions arise, like for instance, where is the basis for all this business being reported in the Capesize market? Is there a sense that previous bullish sentiment for this size group is leading new investment without there being a real demand for further fleet growth? Could this lead to further dragging out of sub-performing markets?
According to Lazaridis' viewpoint, "over the past couple of months we have seen the majority of trading sessions being reported at average freight figures bellow what is expected for most owners to cover OPEX. Even on some of the more positive trading days, TCE increases are temporary and usually attributed to momentary decreases in bunker costs as well as slow steaming throughout the fleet which helps increase what little extra earnings owners can squeeze out of the current market rates. The counter argument to this can be found in part in the wisdom of old. Through most shipping cycles owners have usually taken a long-term position hoping to make high gains through the cycle rather than only looking to act during periods where the market is on the rise. If they waited for the later we would not have any ship owners left. This may explain activity in the secondhand market however things are very different when it comes to newbuildings. Capesize newbuilding designs have not had the same overhaul in performance that we have seen in other size segments. So why are owner’s risking of drowning the market with further ordering when there are plenty of well-priced secondhand units available. It seems to be yet again the case of easier financing, respectively lower prices, easi-er payment terms and forward delivery that have the upside of even gaining in value before you have made full payment. As promising as all these sound to a potential buyer, a word of caution to the brave, “as you sow, so shall you reap”, he concluded.
Source: Nikos Roussanoglou, Hellenic Shipping News
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Wednesday, 30 September 20
MARKET INSIGHT - INTERMODAL
Spot rates for Capesize bulk carriers received a significant boost last week, however, there are certain reservations in the market regarding the p ...
Tuesday, 29 September 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX UP 0.73 PCT - XINHUA
China Taiyuan coal transaction price index stood at 125.91 points Monday, up 0.73 percent week on week.
The index, released by China ...
Tuesday, 29 September 20
SHIPPING MARKET - ALLIED
Here we are, just a short breath before the final quarter of the year, and many are now debating to what extent we can really expect a firm dry bul ...
Tuesday, 29 September 20
INDONESIAN COAL COMPANIES' EARNINGS TO WEAKEN IN 2H20 - FITCH RATINGS
Rated Indonesian coal miners and contractors will have weaker operating and financial performances in the second half of 2020 than in the first, sa ...
Tuesday, 29 September 20
RUSSIA'S COAL PRODUCTION TO DROP BY 10.5% IN 2020, SAYS MINISTRY - TASS
Russia’s Economic Development Ministry projects a 10.5% decrease in coal production in the country in 2020 compared with last year to 395 mln ...
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- India Bulls Power Limited - India
- Singapore Mercantile Exchange
- Commonwealth Bank - Australia
- European Bulk Services B.V. - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Electricity Generating Authority of Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Savvy Resources Ltd - HongKong
- Bharathi Cement Corporation - India
- Coalindo Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Georgia Ports Authority, United States
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Coastal Gujarat Power Limited - India
- Riau Bara Harum - Indonesia
- SMC Global Power, Philippines
- Independent Power Producers Association of India
- Bhatia International Limited - India
- Edison Trading Spa - Italy
- Krishnapatnam Port Company Ltd. - India
- Pendopo Energi Batubara - Indonesia
- Directorate Of Revenue Intelligence - India
- Kartika Selabumi Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhushan Steel Limited - India
- The Treasury - Australian Government
- International Coal Ventures Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- SMG Consultants - Indonesia
- Globalindo Alam Lestari - Indonesia
- Deloitte Consulting - India
- Gujarat Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Grasim Industreis Ltd - India
- Latin American Coal - Colombia
- Baramulti Group, Indonesia
- Sakthi Sugars Limited - India
- Global Coal Blending Company Limited - Australia
- Kumho Petrochemical, South Korea
- Orica Australia Pty. Ltd.
- Thiess Contractors Indonesia
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- Neyveli Lignite Corporation Ltd, - India
- Power Finance Corporation Ltd., India
- MS Steel International - UAE
- Mintek Dendrill Indonesia
- Interocean Group of Companies - India
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Manunggal Multi Energi - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Madhucon Powers Ltd - India
- Lanco Infratech Ltd - India
- CIMB Investment Bank - Malaysia
- Straits Asia Resources Limited - Singapore
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- Therma Luzon, Inc, Philippines
- Africa Commodities Group - South Africa
- Jaiprakash Power Ventures ltd
- Samtan Co., Ltd - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- GVK Power & Infra Limited - India
- Australian Coal Association
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- Goldman Sachs - Singapore
- Sree Jayajothi Cements Limited - India
- Rashtriya Ispat Nigam Limited - India
- ASAPP Information Group - India
- SN Aboitiz Power Inc, Philippines
- Petron Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Simpson Spence & Young - Indonesia
- Medco Energi Mining Internasional
- Videocon Industries ltd - India
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Chamber of Mines of South Africa
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Metalloyd Limited - United Kingdom
- Minerals Council of Australia
- Makarim & Taira - Indonesia
- Toyota Tsusho Corporation, Japan
- Thai Mozambique Logistica
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Oldendorff Carriers - Singapore
- Star Paper Mills Limited - India
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- Ministry of Mines - Canada
- TeaM Sual Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Marubeni Corporation - India
- Ceylon Electricity Board - Sri Lanka
- PowerSource Philippines DevCo
- Dalmia Cement Bharat India
- Indika Energy - Indonesia
- Renaissance Capital - South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- The University of Queensland
- Central Electricity Authority - India
- Iligan Light & Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Wood Mackenzie - Singapore
- Cigading International Bulk Terminal - Indonesia
- Larsen & Toubro Limited - India
- OPG Power Generation Pvt Ltd - India
- Tata Chemicals Ltd - India
- Gujarat Sidhee Cement - India
- Central Java Power - Indonesia
- Romanian Commodities Exchange
- Global Green Power PLC Corporation, Philippines
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- Meenaskhi Energy Private Limited - India
- London Commodity Brokers - England
- Ind-Barath Power Infra Limited - India
- Indian Energy Exchange, India
- Eastern Energy - Thailand
- Kalimantan Lumbung Energi - Indonesia
- Sical Logistics Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indogreen Group - Indonesia
- Sojitz Corporation - Japan
- Mercuria Energy - Indonesia
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- New Zealand Coal & Carbon
- Siam City Cement PLC, Thailand
- Meralco Power Generation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Cement Manufacturers Association - India
- Uttam Galva Steels Limited - India
- Wilmar Investment Holdings
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kepco SPC Power Corporation, Philippines
- Indonesian Coal Mining Association
- LBH Netherlands Bv - Netherlands
- Barasentosa Lestari - Indonesia
- Planning Commission, India
- Bukit Baiduri Energy - Indonesia
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- Port Waratah Coal Services - Australia
- The State Trading Corporation of India Ltd
- Maheswari Brothers Coal Limited - India
- Semirara Mining Corp, Philippines
- Banpu Public Company Limited - Thailand
- GAC Shipping (India) Pvt Ltd
- Indian Oil Corporation Limited
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Australian Commodity Traders Exchange
- Sarangani Energy Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Price Waterhouse Coopers - Russia
- Economic Council, Georgia
- GN Power Mariveles Coal Plant, Philippines
- Vizag Seaport Private Limited - India
- IEA Clean Coal Centre - UK
- White Energy Company Limited
- Gujarat Mineral Development Corp Ltd - India
- Heidelberg Cement - Germany
- PTC India Limited - India
- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Orica Mining Services - Indonesia
- Jindal Steel & Power Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Vedanta Resources Plc - India
- Trasteel International SA, Italy
- CNBM International Corporation - China
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- McConnell Dowell - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- Mjunction Services Limited - India
- Antam Resourcindo - Indonesia
- Borneo Indobara - Indonesia
- Bulk Trading Sa - Switzerland
- Rio Tinto Coal - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Electricity Authority, New Zealand
- Malabar Cements Ltd - India
- GMR Energy Limited - India
- Energy Development Corp, Philippines
- Karaikal Port Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Kideco Jaya Agung - Indonesia
- Mercator Lines Limited - India
- Salva Resources Pvt Ltd - India
- Parry Sugars Refinery, India
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- ICICI Bank Limited - India
- IHS Mccloskey Coal Group - USA
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