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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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- CNBM International Corporation - China
- Energy Link Ltd, New Zealand
- Orica Australia Pty. Ltd.
- Globalindo Alam Lestari - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Economic Council, Georgia
- ICICI Bank Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- The University of Queensland
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- McConnell Dowell - Australia
- International Coal Ventures Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Makarim & Taira - Indonesia
- Ministry of Mines - Canada
- Kalimantan Lumbung Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- Mercator Lines Limited - India
- Renaissance Capital - South Africa
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Meralco Power Generation, Philippines
- Sakthi Sugars Limited - India
- Indian Energy Exchange, India
- Eastern Energy - Thailand
- Petron Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- New Zealand Coal & Carbon
- Xindia Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Oldendorff Carriers - Singapore
- Bukit Baiduri Energy - Indonesia
- Bhatia International Limited - India
- Sinarmas Energy and Mining - Indonesia
- Deloitte Consulting - India
- Ministry of Transport, Egypt
- Jaiprakash Power Ventures ltd
- Parliament of New Zealand
- Binh Thuan Hamico - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
- Aditya Birla Group - India
- Grasim Industreis Ltd - India
- Global Green Power PLC Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- SMG Consultants - Indonesia
- Sical Logistics Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Central Electricity Authority - India
- Interocean Group of Companies - India
- Africa Commodities Group - South Africa
- Bulk Trading Sa - Switzerland
- Antam Resourcindo - Indonesia
- Vedanta Resources Plc - India
- OPG Power Generation Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Videocon Industries ltd - India
- San Jose City I Power Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Indogreen Group - Indonesia
- Larsen & Toubro Limited - India
- Chamber of Mines of South Africa
- Rio Tinto Coal - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Mercuria Energy - Indonesia
- IEA Clean Coal Centre - UK
- Kumho Petrochemical, South Korea
- Lanco Infratech Ltd - India
- Medco Energi Mining Internasional
- Baramulti Group, Indonesia
- GVK Power & Infra Limited - India
- Thiess Contractors Indonesia
- Salva Resources Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Independent Power Producers Association of India
- Global Coal Blending Company Limited - Australia
- Sindya Power Generating Company Private Ltd
- Anglo American - United Kingdom
- Uttam Galva Steels Limited - India
- Eastern Coal Council - USA
- AsiaOL BioFuels Corp., Philippines
- Barasentosa Lestari - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- TNB Fuel Sdn Bhd - Malaysia
- Bharathi Cement Corporation - India
- Directorate Of Revenue Intelligence - India
- Edison Trading Spa - Italy
- Altura Mining Limited, Indonesia
- The Treasury - Australian Government
- Neyveli Lignite Corporation Ltd, - India
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Manunggal Multi Energi - Indonesia
- Siam City Cement - Thailand
- ASAPP Information Group - India
- Maheswari Brothers Coal Limited - India
- Dalmia Cement Bharat India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Aboitiz Power Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mintek Dendrill Indonesia
- Vizag Seaport Private Limited - India
- Krishnapatnam Port Company Ltd. - India
- Merrill Lynch Commodities Europe
- Power Finance Corporation Ltd., India
- IHS Mccloskey Coal Group - USA
- Kaltim Prima Coal - Indonesia
- Heidelberg Cement - Germany
- Coal and Oil Company - UAE
- Georgia Ports Authority, United States
- Wood Mackenzie - Singapore
- Iligan Light & Power Inc, Philippines
- Marubeni Corporation - India
- LBH Netherlands Bv - Netherlands
- London Commodity Brokers - England
- Wilmar Investment Holdings
- Kepco SPC Power Corporation, Philippines
- Latin American Coal - Colombia
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Orica Mining Services - Indonesia
- Planning Commission, India
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
- Australian Coal Association
- Banpu Public Company Limited - Thailand
- Thai Mozambique Logistica
- White Energy Company Limited
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Metalloyd Limited - United Kingdom
- Star Paper Mills Limited - India
- Formosa Plastics Group - Taiwan
- Gujarat Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Meenaskhi Energy Private Limited - India
- SMC Global Power, Philippines
- Price Waterhouse Coopers - Russia
- Kapuas Tunggal Persada - Indonesia
- VISA Power Limited - India
- Straits Asia Resources Limited - Singapore
- Kobexindo Tractors - Indoneisa
- Bhushan Steel Limited - India
- Indika Energy - Indonesia
- Agrawal Coal Company - India
- TeaM Sual Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Global Business Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Timah Investasi Mineral - Indoneisa
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Ambuja Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Coalindo Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Karaikal Port Pvt Ltd - India
- Parry Sugars Refinery, India
- Intertek Mineral Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- PowerSource Philippines DevCo
- Malabar Cements Ltd - India
- Singapore Mercantile Exchange
- Semirara Mining Corp, Philippines
- Simpson Spence & Young - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Energy Development Corp, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Therma Luzon, Inc, Philippines
- Posco Energy - South Korea
- MS Steel International - UAE
- Gujarat Sidhee Cement - India
- Ceylon Electricity Board - Sri Lanka
- Carbofer General Trading SA - India
- Standard Chartered Bank - UAE
- GMR Energy Limited - India
- Tamil Nadu electricity Board
- Coastal Gujarat Power Limited - India
- Indian Oil Corporation Limited
- Sojitz Corporation - Japan
- Romanian Commodities Exchange
- Bahari Cakrawala Sebuku - Indonesia
- Jindal Steel & Power Ltd - India
- Ministry of Finance - Indonesia
- Chettinad Cement Corporation Ltd - India
- Savvy Resources Ltd - HongKong
- Indonesian Coal Mining Association
- Siam City Cement PLC, Thailand
- Madhucon Powers Ltd - India
- Trasteel International SA, Italy
- Jorong Barutama Greston.PT - Indonesia
- India Bulls Power Limited - India
- Minerals Council of Australia
- Borneo Indobara - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Cement Manufacturers Association - India
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