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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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Monday, 08 January 24
KOSPO TO BUY 80000 MT OF INDONESIAN LOW CALORIFIC VALUE COAL FOR FEB 2024
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for the supply of Indonesian Low Calorific Value Coal from qualified suppliers for Korean ...
Monday, 08 January 24
SEABORNE TRADE REACHES 12.4BN TONNES - CLARKSONS
China will establish a back-up coal production system by 2027 to stabilise prices and secure coal supply, the state planner said on Wednesday, even ...
Monday, 08 January 24
CAPESIZES START THE NEW YEAR ON POSITIVE NOTE - BALTIC EXCHANGE
Capesize
This week the capsize market has been marked by a mix of activities and challenges. Despite a slow start following the Christmas and N ...
Friday, 05 January 24
MORGAN STANLEY SEES LOWER OIL PRICES IN 2024 ON OVERSUPPLY CONCERNS - REUTERS
Morgan Stanley sees Brent crude prices anchored near $80 per barrel in the first half in 2024 before declining towards the end of the year as it ex ...
Friday, 05 January 24
INDIA'S COAL OUTPUT RISES NEARLY 11 PC IN DEC TO 92.87 MT - PTI
India’s coal production increased by 10.75 per cent to 92.87 million tonne in December 2023 as compared to the year-ago period, an official s ...
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- Barasentosa Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- Madhucon Powers Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Bukit Baiduri Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Mercator Lines Limited - India
- Petron Corporation, Philippines
- Economic Council, Georgia
- Alfred C Toepfer International GmbH - Germany
- Larsen & Toubro Limited - India
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- Videocon Industries ltd - India
- Cement Manufacturers Association - India
- Heidelberg Cement - Germany
- Mercuria Energy - Indonesia
- Wilmar Investment Holdings
- IHS Mccloskey Coal Group - USA
- Intertek Mineral Services - Indonesia
- Straits Asia Resources Limited - Singapore
- Simpson Spence & Young - Indonesia
- Meralco Power Generation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- India Bulls Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Interocean Group of Companies - India
- Attock Cement Pakistan Limited
- Anglo American - United Kingdom
- Electricity Generating Authority of Thailand
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Edison Trading Spa - Italy
- Indian Oil Corporation Limited
- Eastern Coal Council - USA
- Essar Steel Hazira Ltd - India
- Kartika Selabumi Mining - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indika Energy - Indonesia
- Indian Energy Exchange, India
- Merrill Lynch Commodities Europe
- Tata Chemicals Ltd - India
- Posco Energy - South Korea
- Indogreen Group - Indonesia
- Aditya Birla Group - India
- CIMB Investment Bank - Malaysia
- PowerSource Philippines DevCo
- Bharathi Cement Corporation - India
- Bangladesh Power Developement Board
- Sojitz Corporation - Japan
- Directorate Of Revenue Intelligence - India
- Ceylon Electricity Board - Sri Lanka
- Standard Chartered Bank - UAE
- Kideco Jaya Agung - Indonesia
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- Siam City Cement - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Chettinad Cement Corporation Ltd - India
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Ministry of Finance - Indonesia
- Globalindo Alam Lestari - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sarangani Energy Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Global Business Power Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- SMG Consultants - Indonesia
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Coastal Gujarat Power Limited - India
- London Commodity Brokers - England
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- Bulk Trading Sa - Switzerland
- Bayan Resources Tbk. - Indonesia
- Central Electricity Authority - India
- Eastern Energy - Thailand
- Neyveli Lignite Corporation Ltd, - India
- Iligan Light & Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Sical Logistics Limited - India
- Coal and Oil Company - UAE
- Meenaskhi Energy Private Limited - India
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- Georgia Ports Authority, United States
- Binh Thuan Hamico - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Vizag Seaport Private Limited - India
- San Jose City I Power Corp, Philippines
- Energy Development Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Rashtriya Ispat Nigam Limited - India
- Uttam Galva Steels Limited - India
- Central Java Power - Indonesia
- Indonesian Coal Mining Association
- Semirara Mining Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- Antam Resourcindo - Indonesia
- Independent Power Producers Association of India
- Vijayanagar Sugar Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Africa Commodities Group - South Africa
- Thai Mozambique Logistica
- Therma Luzon, Inc, Philippines
- PTC India Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Carbofer General Trading SA - India
- Lanco Infratech Ltd - India
- Samtan Co., Ltd - South Korea
- Gujarat Mineral Development Corp Ltd - India
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- VISA Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Manunggal Multi Energi - Indonesia
- The University of Queensland
- Orica Australia Pty. Ltd.
- Kobexindo Tractors - Indoneisa
- New Zealand Coal & Carbon
- Australian Coal Association
- Asmin Koalindo Tuhup - Indonesia
- Banpu Public Company Limited - Thailand
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Electricity Regulatory Commission - India
- Billiton Holdings Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Siam City Cement PLC, Thailand
- SN Aboitiz Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Rio Tinto Coal - Australia
- ASAPP Information Group - India
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- GMR Energy Limited - India
- TeaM Sual Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- MS Steel International - UAE
- Marubeni Corporation - India
- McConnell Dowell - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- SMC Global Power, Philippines
- Global Green Power PLC Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Energy Link Ltd, New Zealand
- Xindia Steels Limited - India
- Minerals Council of Australia
- European Bulk Services B.V. - Netherlands
- Miang Besar Coal Terminal - Indonesia
- PNOC Exploration Corporation - Philippines
- Planning Commission, India
- Agrawal Coal Company - India
- Leighton Contractors Pty Ltd - Australia
- Sree Jayajothi Cements Limited - India
- Medco Energi Mining Internasional
- Sinarmas Energy and Mining - Indonesia
- Dalmia Cement Bharat India
- Timah Investasi Mineral - Indoneisa
- Aboitiz Power Corporation - Philippines
- Coalindo Energy - Indonesia
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Renaissance Capital - South Africa
- Deloitte Consulting - India
- Cigading International Bulk Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Gujarat Sidhee Cement - India
- Bhushan Steel Limited - India
- Port Waratah Coal Services - Australia
- Trasteel International SA, Italy
- Salva Resources Pvt Ltd - India
- Singapore Mercantile Exchange
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Kumho Petrochemical, South Korea
- White Energy Company Limited
- Jindal Steel & Power Ltd - India
- Sakthi Sugars Limited - India
- Parliament of New Zealand
- Holcim Trading Pte Ltd - Singapore
- Orica Mining Services - Indonesia
- Baramulti Group, Indonesia
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Australian Commodity Traders Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Commonwealth Bank - Australia
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- Romanian Commodities Exchange
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