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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, 05 January 24
BANGLADESH’S 2023 COAL-FIRED POWER OUTPUT TRIPLED, EASING SHORTAGES - REUTERS
Bangladesh nearly tripled its coal-fired power output in 2023, a Reuters analysis of government data showed, helping it tide over the worst power s ...
Tuesday, 02 January 24
COAL TRADE CONTINUES TO HEAD EAST - BALTIC EXCHANGE
The global coal trade, once concentrated in the Pacific and Atlantic basins, is undergoing a significant transformation, as highlighted in the Inte ...
Tuesday, 02 January 24
COAL CARGOES: AVOIDING EXPLOSION AND SELF-HEATING - GARD
KNOWLEDGE TO ELEVATE
Despite its contribution to greenhouse gas emissions, global coal consumption climbed to an all-time high in 2022 and is ...
Tuesday, 02 January 24
SINOPEC FORECASTS CHINA’S COAL CONSUMPTION TO PEAK AROUND 2025 - REUTERS
China Petrochemical Corp, or Sinopec, expects coal consumption to peak around 2025 at 4.37 billion metric tons, the state energy group said in an o ...
Thursday, 07 December 23
CHINA TO SET UP COAL PRODUCTION RESERVE TO STABILISE PRICES - REUTERS
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 ...
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- Wood Mackenzie - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Savvy Resources Ltd - HongKong
- Uttam Galva Steels Limited - India
- Indonesian Coal Mining Association
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Siam City Cement - Thailand
- SMC Global Power, Philippines
- Semirara Mining Corp, Philippines
- Posco Energy - South Korea
- Gujarat Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- Mercator Lines Limited - India
- Bayan Resources Tbk. - Indonesia
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- San Jose City I Power Corp, Philippines
- Africa Commodities Group - South Africa
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Price Waterhouse Coopers - Russia
- PNOC Exploration Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Economic Council, Georgia
- Mercuria Energy - Indonesia
- Heidelberg Cement - Germany
- Star Paper Mills Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Eastern Coal Council - USA
- Essar Steel Hazira Ltd - India
- Aditya Birla Group - India
- LBH Netherlands Bv - Netherlands
- Karaikal Port Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Australian Coal Association
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- CNBM International Corporation - China
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- PowerSource Philippines DevCo
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- Sinarmas Energy and Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Indogreen Group - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Dalmia Cement Bharat India
- Planning Commission, India
- Kobexindo Tractors - Indoneisa
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Gujarat Sidhee Cement - India
- MS Steel International - UAE
- Kideco Jaya Agung - Indonesia
- Vizag Seaport Private Limited - India
- Global Green Power PLC Corporation, Philippines
- GMR Energy Limited - India
- European Bulk Services B.V. - Netherlands
- ICICI Bank Limited - India
- Energy Development Corp, Philippines
- Marubeni Corporation - India
- IEA Clean Coal Centre - UK
- London Commodity Brokers - England
- Ambuja Cements Ltd - India
- Sarangani Energy Corporation, Philippines
- Ministry of Finance - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Thiess Contractors Indonesia
- Petron Corporation, Philippines
- Riau Bara Harum - Indonesia
- Madhucon Powers Ltd - India
- Baramulti Group, Indonesia
- Kaltim Prima Coal - Indonesia
- PTC India Limited - India
- Xindia Steels Limited - India
- Therma Luzon, Inc, Philippines
- SN Aboitiz Power Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Malabar Cements Ltd - India
- Tamil Nadu electricity Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Romanian Commodities Exchange
- OPG Power Generation Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Minerals Council of Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Central Java Power - Indonesia
- Electricity Authority, New Zealand
- GN Power Mariveles Coal Plant, Philippines
- International Coal Ventures Pvt Ltd - India
- Coal and Oil Company - UAE
- Straits Asia Resources Limited - Singapore
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ind-Barath Power Infra Limited - India
- Merrill Lynch Commodities Europe
- Sojitz Corporation - Japan
- Aboitiz Power Corporation - Philippines
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- Kartika Selabumi Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Indian Oil Corporation Limited
- Metalloyd Limited - United Kingdom
- Orica Australia Pty. Ltd.
- Bangladesh Power Developement Board
- Global Coal Blending Company Limited - Australia
- Cement Manufacturers Association - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Globalindo Alam Lestari - Indonesia
- Barasentosa Lestari - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Jorong Barutama Greston.PT - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Videocon Industries ltd - India
- Mjunction Services Limited - India
- Holcim Trading Pte Ltd - Singapore
- Banpu Public Company Limited - Thailand
- IHS Mccloskey Coal Group - USA
- McConnell Dowell - Australia
- Chettinad Cement Corporation Ltd - India
- The University of Queensland
- GVK Power & Infra Limited - India
- The State Trading Corporation of India Ltd
- Rashtriya Ispat Nigam Limited - India
- Kepco SPC Power Corporation, Philippines
- Parliament of New Zealand
- Mintek Dendrill Indonesia
- Bharathi Cement Corporation - India
- Edison Trading Spa - Italy
- Gujarat Mineral Development Corp Ltd - India
- Grasim Industreis Ltd - India
- New Zealand Coal & Carbon
- Makarim & Taira - Indonesia
- Port Waratah Coal Services - Australia
- Larsen & Toubro Limited - India
- Kapuas Tunggal Persada - Indonesia
- Borneo Indobara - Indonesia
- Sree Jayajothi Cements Limited - India
- Medco Energi Mining Internasional
- Iligan Light & Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Australian Commodity Traders Exchange
- Vedanta Resources Plc - India
- Siam City Cement PLC, Thailand
- Indika Energy - Indonesia
- Standard Chartered Bank - UAE
- Jaiprakash Power Ventures ltd
- Lanco Infratech Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Anglo American - United Kingdom
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Samtan Co., Ltd - South Korea
- India Bulls Power Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Asmin Koalindo Tuhup - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Deloitte Consulting - India
- VISA Power Limited - India
- Global Business Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Eastern Energy - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Carbofer General Trading SA - India
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- White Energy Company Limited
- Central Electricity Authority - India
- Neyveli Lignite Corporation Ltd, - India
- Jindal Steel & Power Ltd - India
- Coalindo Energy - Indonesia
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- Antam Resourcindo - Indonesia
- Interocean Group of Companies - India
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- Commonwealth Bank - Australia
- TeaM Sual Corporation - Philippines
- Thai Mozambique Logistica
- Timah Investasi Mineral - Indoneisa
- Wilmar Investment Holdings
- Trasteel International SA, Italy
- Sakthi Sugars Limited - India
- ASAPP Information Group - India
- Semirara Mining and Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- Indian Energy Exchange, India
- Toyota Tsusho Corporation, Japan
- Independent Power Producers Association of India
- Maheswari Brothers Coal Limited - India
- SMG Consultants - Indonesia
- Sical Logistics Limited - India
- Georgia Ports Authority, United States
- Sindya Power Generating Company Private Ltd
- Kumho Petrochemical, South Korea
- Bhoruka Overseas - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Renaissance Capital - South Africa
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