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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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Thursday, 25 January 24
THE RED SEA ESCALATION IMPLICATIONS ON GLOBAL SEABORNE TRADE - MARIA BERTZELETOU
In recent days, discussions have intensified about the potential impact on the seaborne trade and ton-miles due to the evolving dynamics of market ...
Thursday, 25 January 24
RED SEA SHIPPING DISRUPTIONS KEEP GEOPOLITICAL PREMIUM FOR COMMODITIES - FITCH RATINGS
Shipping disruptions and re-routing away from the Red Sea will maintain the geopolitical premium in the main commodity markets, including for oil a ...
Friday, 19 January 24
INDONESIA TARGETS 710 MLN METRIC TONS COAL OUTPUT IN 2024 AFTER RECORD 2023 - REUTERS
Indonesia, a major thermal coal exporter, aims to produce 710 million metric tons of coal in 2024, its mining minister said on Monday, after postin ...
Friday, 19 January 24
DRUMMOND COLOMBIA COAL OUTPUT ROSE 7.1% IN 2023 - REUTERS
Coal production from miner Drummond’s Colombia operations rose 7.1% in 2023 to 29.5 million metric tons, while exports declined by 2.6% to 27 ...
Friday, 19 January 24
CHINA'S 2023 COAL OUTPUT HITS RECORD HIGH - REUTERS
China’s coal output reached a record high in 2023, data from the statistics bureau showed on Wednesday, amid an ongoing focus on energy secur ...
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- Kapuas Tunggal Persada - Indonesia
- Bangladesh Power Developement Board
- Central Electricity Authority - India
- Altura Mining Limited, Indonesia
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- OPG Power Generation Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Parliament of New Zealand
- Goldman Sachs - Singapore
- Bulk Trading Sa - Switzerland
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Power Finance Corporation Ltd., India
- Aboitiz Power Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Ministry of Finance - Indonesia
- Trasteel International SA, Italy
- Indian Oil Corporation Limited
- Eastern Coal Council - USA
- Marubeni Corporation - India
- Essar Steel Hazira Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- Grasim Industreis Ltd - India
- Chamber of Mines of South Africa
- GN Power Mariveles Coal Plant, Philippines
- Petron Corporation, Philippines
- Standard Chartered Bank - UAE
- Ministry of Transport, Egypt
- SMC Global Power, Philippines
- Africa Commodities Group - South Africa
- Latin American Coal - Colombia
- Sical Logistics Limited - India
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Australian Coal Association
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- Electricity Authority, New Zealand
- Ceylon Electricity Board - Sri Lanka
- Sarangani Energy Corporation, Philippines
- Energy Link Ltd, New Zealand
- Makarim & Taira - Indonesia
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- Uttam Galva Steels Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- IEA Clean Coal Centre - UK
- Indo Tambangraya Megah - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Interocean Group of Companies - India
- Bhatia International Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Global Business Power Corporation, Philippines
- Parry Sugars Refinery, India
- Chettinad Cement Corporation Ltd - India
- Formosa Plastics Group - Taiwan
- Economic Council, Georgia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate Of Revenue Intelligence - India
- Deloitte Consulting - India
- Energy Development Corp, Philippines
- Intertek Mineral Services - Indonesia
- PowerSource Philippines DevCo
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- McConnell Dowell - Australia
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- Sojitz Corporation - Japan
- Jaiprakash Power Ventures ltd
- Jindal Steel & Power Ltd - India
- The University of Queensland
- Mintek Dendrill Indonesia
- Rio Tinto Coal - Australia
- Ind-Barath Power Infra Limited - India
- Kumho Petrochemical, South Korea
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement PLC, Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Edison Trading Spa - Italy
- Kaltim Prima Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- Binh Thuan Hamico - Vietnam
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- Medco Energi Mining Internasional
- CNBM International Corporation - China
- South Luzon Thermal Energy Corporation
- Global Coal Blending Company Limited - Australia
- Coal and Oil Company - UAE
- Port Waratah Coal Services - Australia
- Agrawal Coal Company - India
- Malabar Cements Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Xindia Steels Limited - India
- Videocon Industries ltd - India
- TeaM Sual Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- New Zealand Coal & Carbon
- Asmin Koalindo Tuhup - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- Dalmia Cement Bharat India
- Barasentosa Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Globalindo Alam Lestari - Indonesia
- Gujarat Electricity Regulatory Commission - India
- London Commodity Brokers - England
- Baramulti Group, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Planning Commission, India
- Pendopo Energi Batubara - Indonesia
- ICICI Bank Limited - India
- Cement Manufacturers Association - India
- Gujarat Mineral Development Corp Ltd - India
- Sindya Power Generating Company Private Ltd
- Rashtriya Ispat Nigam Limited - India
- International Coal Ventures Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- India Bulls Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Antam Resourcindo - Indonesia
- The State Trading Corporation of India Ltd
- Maharashtra Electricity Regulatory Commission - India
- Krishnapatnam Port Company Ltd. - India
- Star Paper Mills Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Metalloyd Limited - United Kingdom
- Central Java Power - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Global Green Power PLC Corporation, Philippines
- White Energy Company Limited
- Kepco SPC Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Thiess Contractors Indonesia
- Karaikal Port Pvt Ltd - India
- PTC India Limited - India
- Kartika Selabumi Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Kalimantan Lumbung Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Indian Energy Exchange, India
- Lanco Infratech Ltd - India
- Samtan Co., Ltd - South Korea
- GAC Shipping (India) Pvt Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Makmur.PT - Indonesia
- Tamil Nadu electricity Board
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Baiduri Energy - Indonesia
- Georgia Ports Authority, United States
- IHS Mccloskey Coal Group - USA
- Mercuria Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Wood Mackenzie - Singapore
- Coalindo Energy - Indonesia
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- Larsen & Toubro Limited - India
- European Bulk Services B.V. - Netherlands
- Heidelberg Cement - Germany
- Straits Asia Resources Limited - Singapore
- Mercator Lines Limited - India
- ASAPP Information Group - India
- Holcim Trading Pte Ltd - Singapore
- Vizag Seaport Private Limited - India
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- MS Steel International - UAE
- Kobexindo Tractors - Indoneisa
- Minerals Council of Australia
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- Thai Mozambique Logistica
- Anglo American - United Kingdom
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- Electricity Generating Authority of Thailand
- AsiaOL BioFuels Corp., Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Carbofer General Trading SA - India
- GVK Power & Infra Limited - India
- Oldendorff Carriers - Singapore
- Maheswari Brothers Coal Limited - India
- SMG Consultants - Indonesia
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Mjunction Services Limited - India
- Eastern Energy - Thailand
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Ambuja Cements Ltd - India
- Banpu Public Company Limited - Thailand
- Miang Besar Coal Terminal - Indonesia
- Sakthi Sugars Limited - India
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