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Thursday, 13 June 13
BIMCO EXPECTS SUBDUED CAPESIZE EARNINGS FOR THE COMING WEEKS - HELLENIC SHIPPING NEWS
 Bulk is not only about China even though it is a key driver. In this section, we have taken a closer look at the European seaborne coal markets, which is going through some interesting times right now. European coal demand has been in a slump ever since early 2009, where seaborne demand fell by 14 million tons from the first to the second quarter. Import volumes during the last three quarters of 2011 indicated that seaborne coal demand was recovering, but the development stalled somewhat in 2012. Looking on a country basis, the nation with the biggest decline was Italy, with annual seaborne imports being roughly 8 million tons lower today than before the financial crisis. France has also decreased its imports by around 4-5 million tons annually. The United Kingdom and Spain have weakened as well, but these countries seem to be on a rebound, with volumes being slightly below pre-financial crisis levels. The Netherlands and Germany have had relatively stable import numbers since 2005.
The bulk of seaborne coal going to Europe comes from North America, Colombia and Russia. The United States and Colombia have doubled their exports to Europe, while Russia has maintained its share of the European demand. Russian coal is shipped from both Russian and Latvian ports; Colombian coal is primarily shipped from the Caribbean, while US coal is primarily shipped from the Atlantic Coast and the Mexican Gulf. The drop in European seaborne demand for coal did not affect these countries, but rather South Africa. From being the single largest coal exporter to Europe with 52.0 million tons in 2005, the country has become a footnote, with 13.6 million tons in 2011. This represents bad business for the shipping industry, since the sailing distance from Richards Bay to Rotterdam is 98% longer than from Hampton Roads and 61% longer than from Puerto Bolivar.
Although European coal imports didn’t tell a particular positive story for shipping, US exports most certainly did. We expect to publish a story on this within the next couple of weeks.
On a more general note regarding the bulk market, China is expected to increase its imports of wheat, as sub-standard storage facilities have damaged a part of the huge Chinese stockpiles. Traders said that China is seeking to increase imports when global prices are in a slump. Current forward prices indicate that this may happen during the third quarter of 2013. According to Chinese customs statistics, the main exporters of wheat to China are Australia, Canada and United States, the latter two providing significant tonne miles.
Meanwhile, Argentina is exporting record high volumes of grains; CRSL reported that Argentina exported 4.86 million tons of grains in March – the highest number ever for a single month. This gave a spike in Panamax rates with the BPI staying just below the psychological barrier of USD 10,000 per day in March and April, but earnings are now slightly lower at around USD 7,000 per day. In our last report, we predicted that Panamax rates would stay in the USD 5,000-10,000 per day territory; going forward seasonal events like Argentinian exports are likely to provide for the upside ticks.
SUPPLY
New dry bulk deliveries walk the anticipated line and have now reached 29 million DWT. Meanwhile, 11 million DWT have been sold for recycling, which brings the year-to-date fleet growth up to 2.8%. The inflow is seen primarily in the Panamax segment, where 136 (in 2012: 162) new vessels are keeping Panamax fleet growth high. Simultaneously, the Capesize segment only saw 48 (in 2012: 115) new vessels coming on stream, eventually easing some of the pain from the current overcapacity.
Average age and size of the demolished tonnage is 28 years and 60,000 DWT. In line with the development seen in the last couple of years, the average age is still trending down – whereas the average size is essentially unchanged. BIMCO forecasts a slightly lower level of tonnage being demolished in 2013 as compared to last year; however, it is still going to be the second-largest year on record. The solid level of demolition prices will inspire owners to consider recycling, rather than trading their old tonnage in a very volatile market without certainty of sustainable freight rates and against more energy efficient tonnage.
As regards the orderbook, it’s also moving in the right direction in spite of the recent flurry of new orders for more fuel-efficient tonnage. During the past 10 weeks the number of newbuilding orders in the book has come down from 1,599 to 1,548. Finally, on the ordering side, strong interest in Capesizes remains evident, with 62 new orders in 2013. A total of 18 million DWT has been ordered in the year so far, with March and April seeing total new orders placed in excess of 4.5 million DWT each month.
OUTLOOK
The Summer lull is creeping up on dry bulk shipping demand following the successful South American grain season. Fortunately, solid demand is keeping spirits up in the dry bulk industry, while the severe extent of overcapacity is pushing the date for a full-blown recovery of earnings into a somewhat distant future. For now the market is getting more and more spot focused, as no owners want to commit tonnage for longer terms at offered levels. Don’t look at the paper market for any support, because you won’t find it. FFA indications (10/6) for Capesize tonnage go to the tune of USD per day: Q3-13, Q4-13, Cal 14 and Cal 15: 7,550, 12,000, 11,450 and 13,700 and for Supramax the indications go as follows in USD per day for the same dates: 7,900, 8,400, 8,600 and 8,900. USD per day in the spot market (10/6): Capesize for 5,571 and Supramax for 9,307.
Expect the unexpected from the dry bulk market seems to be the message passed on in recent years – and today is no different, as Handysize tonnage is earning USD 10,900 per day on an Atlantic round voyage whereas Capesizes are struggling to get a 1 year T/C fixed at USD 10,500 per day if at all. With respect to freight rates for Panamax and Supramax tonnage, they have lost ground since the beginning of March.
To sum up, our forecast for the coming 6 weeks: BIMCO holds the view that Capesize TC average rates are expected to remain subdued around USD 4,500-7,500 per day. Panamax is expected to stay in the USD 4,500-8,000 per day interval. For the Supramax segment, BIMCO forecasts freight rates in the USD 7,000-10,000 per day interval, whereas Handysize rates are forecast to stay at the interval of USD 6,000-8,500 per day.
Source: BIMCO / Hellenic Shipping News
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Friday, 06 September 24
REBOUND IN OIL DEMAND COULD LIFT MARKET IN LATTER HALF OF 2024 - BIMCO
Supply/demand
Based on a strong second half demand, the supply/balance is forecast to strengthen in 2024 but weaken slightly in 2025 as n ...
Friday, 06 September 24
GLOBAL SEABORNE LNG TRADE HAS CONTINUED TO INCREASE LAST YEAR - BANCHERO COSTA
Global seaborne LNG trade has continued to increase last year, helped also by the events in Ukraine which forced Europe to diversify away from Russ ...
Wednesday, 28 August 24
SEABORNE COAL IMPORTS INTO INDIA INCREASED BY +9.9% Y-O-Y TO 146.6 MLN T - BANCHERO COSTA
Global coal trade has really picked up pace over the past year, and is now fully back to pre-Covid levels said Banchero Costa Research in its lates ...
Tuesday, 06 August 24
EXERCISE CAUTION WITH AMMONIA SWITCH - BALTIC EXCHANGE
A new study from the Massachusetts Institute of Technology (MIT) has thrown a spanner into the plan to transition ships from diesel fuel to ammonia ...
Friday, 02 August 24
ENERGY MARKET DEVELOPMENTS: COAL AND NATURAL GAS PRICES REACH RECORD HIGHS - WORLD BANK
The recent surge in natural gas and coal prices has been so swift that the main benchmarks were roughly three times higher in 2022Q2 compared to a ...
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- Chamber of Mines of South Africa
- Tamil Nadu electricity Board
- Lanco Infratech Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- New Zealand Coal & Carbon
- Coastal Gujarat Power Limited - India
- IHS Mccloskey Coal Group - USA
- Larsen & Toubro Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Baramulti Group, Indonesia
- Borneo Indobara - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sojitz Corporation - Japan
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- Siam City Cement PLC, Thailand
- Kumho Petrochemical, South Korea
- Thai Mozambique Logistica
- TeaM Sual Corporation - Philippines
- Barasentosa Lestari - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- The State Trading Corporation of India Ltd
- Goldman Sachs - Singapore
- Sical Logistics Limited - India
- Alfred C Toepfer International GmbH - Germany
- Holcim Trading Pte Ltd - Singapore
- Bulk Trading Sa - Switzerland
- San Jose City I Power Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- Gujarat Mineral Development Corp Ltd - India
- Tata Chemicals Ltd - India
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- Therma Luzon, Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Eastern Coal Council - USA
- Independent Power Producers Association of India
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- ICICI Bank Limited - India
- Coalindo Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Coal Association
- Kepco SPC Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Interocean Group of Companies - India
- Kideco Jaya Agung - Indonesia
- Ministry of Finance - Indonesia
- ASAPP Information Group - India
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- Thiess Contractors Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bangladesh Power Developement Board
- Australian Commodity Traders Exchange
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- GAC Shipping (India) Pvt Ltd
- Latin American Coal - Colombia
- Central Electricity Authority - India
- MS Steel International - UAE
- Bharathi Cement Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Salva Resources Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Videocon Industries ltd - India
- Indonesian Coal Mining Association
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- Toyota Tsusho Corporation, Japan
- PowerSource Philippines DevCo
- Iligan Light & Power Inc, Philippines
- Edison Trading Spa - Italy
- Merrill Lynch Commodities Europe
- Bukit Baiduri Energy - Indonesia
- Singapore Mercantile Exchange
- Wood Mackenzie - Singapore
- McConnell Dowell - Australia
- Ceylon Electricity Board - Sri Lanka
- International Coal Ventures Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Planning Commission, India
- Jindal Steel & Power Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Carbofer General Trading SA - India
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Cement Manufacturers Association - India
- Economic Council, Georgia
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- SMG Consultants - Indonesia
- Trasteel International SA, Italy
- Indika Energy - Indonesia
- Madhucon Powers Ltd - India
- Ind-Barath Power Infra Limited - India
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Cigading International Bulk Terminal - Indonesia
- Attock Cement Pakistan Limited
- Deloitte Consulting - India
- Karaikal Port Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Port Waratah Coal Services - Australia
- Petron Corporation, Philippines
- Meralco Power Generation, Philippines
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Bhushan Steel Limited - India
- Sinarmas Energy and Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Sree Jayajothi Cements Limited - India
- Vedanta Resources Plc - India
- Samtan Co., Ltd - South Korea
- Miang Besar Coal Terminal - Indonesia
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- Africa Commodities Group - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- IEA Clean Coal Centre - UK
- Petrochimia International Co. Ltd.- Taiwan
- London Commodity Brokers - England
- Commonwealth Bank - Australia
- Manunggal Multi Energi - Indonesia
- Bhoruka Overseas - Indonesia
- Rio Tinto Coal - Australia
- GMR Energy Limited - India
- India Bulls Power Limited - India
- Central Java Power - Indonesia
- Sarangani Energy Corporation, Philippines
- Mercator Lines Limited - India
- White Energy Company Limited
- Minerals Council of Australia
- Grasim Industreis Ltd - India
- Jaiprakash Power Ventures ltd
- Bukit Makmur.PT - Indonesia
- GVK Power & Infra Limited - India
- Parry Sugars Refinery, India
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Orica Australia Pty. Ltd.
- Straits Asia Resources Limited - Singapore
- Medco Energi Mining Internasional
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Indogreen Group - Indonesia
- Sakthi Sugars Limited - India
- Standard Chartered Bank - UAE
- Indian Energy Exchange, India
- VISA Power Limited - India
- Mjunction Services Limited - India
- Sindya Power Generating Company Private Ltd
- The University of Queensland
- Gujarat Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- Star Paper Mills Limited - India
- Xindia Steels Limited - India
- Maheswari Brothers Coal Limited - India
- Meenaskhi Energy Private Limited - India
- Banpu Public Company Limited - Thailand
- European Bulk Services B.V. - Netherlands
- Metalloyd Limited - United Kingdom
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- SN Aboitiz Power Inc, Philippines
- Antam Resourcindo - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bhatia International Limited - India
- CNBM International Corporation - China
- Bukit Asam (Persero) Tbk - Indonesia
- Renaissance Capital - South Africa
- Indian Oil Corporation Limited
- Romanian Commodities Exchange
- Kapuas Tunggal Persada - Indonesia
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Karbindo Abesyapradhi - Indoneisa
- Heidelberg Cement - Germany
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Timah Investasi Mineral - Indoneisa
- Chettinad Cement Corporation Ltd - India
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