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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, 18 September 20
INDIA'S COAL-FIRED POWER OUTPUT PICKS UP AS INDUSTRIAL USE RISES - REUTERS
India’s coal-fired electricity generation rose 9.4% in the first half of September, provisional government data showed, as demand from indust ...
Friday, 18 September 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Thursday, 17 September 20
LAST HOPES FOR DEMAND GROWTH SET TO DISAPPOINT THERMAL COAL EXPORTERS - IEEFA
Asian thermal coal exporters are fighting an uphill battle even in new markets
The world’s largest thermal coal exporter is eyeing new m ...
Wednesday, 16 September 20
MARKET INSIGHT - INTERMODAL
Another active week in terms of SnP has concluded in the dry bulk market with a diversified array of transactions recorded. Despite the correction ...
Friday, 11 September 20
IMO 2020: A REVIEW OF THE TRANSITION TO VLSFOS - GARD
KNOWLEDGE TO ELEVATE
Many predictions were made in the run up to the imposition of the MARPOL 2020 sulphur cap, none of which was that the tra ...
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- Jindal Steel & Power Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- India Bulls Power Limited - India
- Malabar Cements Ltd - India
- PowerSource Philippines DevCo
- Oldendorff Carriers - Singapore
- ICICI Bank Limited - India
- Antam Resourcindo - Indonesia
- Salva Resources Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Aditya Birla Group - India
- Price Waterhouse Coopers - Russia
- The University of Queensland
- Merrill Lynch Commodities Europe
- Madhucon Powers Ltd - India
- Makarim & Taira - Indonesia
- Goldman Sachs - Singapore
- Indika Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- South Luzon Thermal Energy Corporation
- Carbofer General Trading SA - India
- PTC India Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- GVK Power & Infra Limited - India
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Indian Energy Exchange, India
- Lanco Infratech Ltd - India
- SN Aboitiz Power Inc, Philippines
- Indogreen Group - Indonesia
- Maheswari Brothers Coal Limited - India
- Kobexindo Tractors - Indoneisa
- Independent Power Producers Association of India
- New Zealand Coal & Carbon
- Globalindo Alam Lestari - Indonesia
- Videocon Industries ltd - India
- Aboitiz Power Corporation - Philippines
- Indonesian Coal Mining Association
- Siam City Cement PLC, Thailand
- Kalimantan Lumbung Energi - Indonesia
- IEA Clean Coal Centre - UK
- Sarangani Energy Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Jaiprakash Power Ventures ltd
- GN Power Mariveles Coal Plant, Philippines
- Central Java Power - Indonesia
- Marubeni Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Ministry of Finance - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kapuas Tunggal Persada - Indonesia
- Kepco SPC Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Tata Chemicals Ltd - India
- Karaikal Port Pvt Ltd - India
- Thai Mozambique Logistica
- Larsen & Toubro Limited - India
- Rashtriya Ispat Nigam Limited - India
- Electricity Authority, New Zealand
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Ceylon Electricity Board - Sri Lanka
- Edison Trading Spa - Italy
- Indo Tambangraya Megah - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Therma Luzon, Inc, Philippines
- Coal and Oil Company - UAE
- Bank of Tokyo Mitsubishi UFJ Ltd
- Wilmar Investment Holdings
- Singapore Mercantile Exchange
- London Commodity Brokers - England
- Barasentosa Lestari - Indonesia
- Africa Commodities Group - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Romanian Commodities Exchange
- Samtan Co., Ltd - South Korea
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Deloitte Consulting - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Dalmia Cement Bharat India
- CNBM International Corporation - China
- Kartika Selabumi Mining - Indonesia
- Wood Mackenzie - Singapore
- Bhushan Steel Limited - India
- Grasim Industreis Ltd - India
- Bukit Baiduri Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Ministry of Transport, Egypt
- Directorate Of Revenue Intelligence - India
- MS Steel International - UAE
- Australian Coal Association
- Bhatia International Limited - India
- Ministry of Mines - Canada
- Power Finance Corporation Ltd., India
- Coastal Gujarat Power Limited - India
- Formosa Plastics Group - Taiwan
- VISA Power Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMG Consultants - Indonesia
- Energy Development Corp, Philippines
- White Energy Company Limited
- Georgia Ports Authority, United States
- Bayan Resources Tbk. - Indonesia
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Agrawal Coal Company - India
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Planning Commission, India
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining and Power Corporation, Philippines
- Central Electricity Authority - India
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- Semirara Mining Corp, Philippines
- Siam City Cement - Thailand
- Cigading International Bulk Terminal - Indonesia
- Metalloyd Limited - United Kingdom
- CIMB Investment Bank - Malaysia
- Riau Bara Harum - Indonesia
- Kideco Jaya Agung - Indonesia
- Bukit Makmur.PT - Indonesia
- Economic Council, Georgia
- Karbindo Abesyapradhi - Indoneisa
- Krishnapatnam Port Company Ltd. - India
- Pendopo Energi Batubara - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Mintek Dendrill Indonesia
- Mjunction Services Limited - India
- Savvy Resources Ltd - HongKong
- Minerals Council of Australia
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Chamber of Mines of South Africa
- Borneo Indobara - Indonesia
- Ambuja Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- Rio Tinto Coal - Australia
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Port Waratah Coal Services - Australia
- Banpu Public Company Limited - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kumho Petrochemical, South Korea
- Energy Link Ltd, New Zealand
- Interocean Group of Companies - India
- Trasteel International SA, Italy
- Renaissance Capital - South Africa
- Gujarat Sidhee Cement - India
- Heidelberg Cement - Germany
- Manunggal Multi Energi - Indonesia
- Global Business Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Chettinad Cement Corporation Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Mercator Lines Limited - India
- Commonwealth Bank - Australia
- Leighton Contractors Pty Ltd - Australia
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- Uttam Galva Steels Limited - India
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Simpson Spence & Young - Indonesia
- Parry Sugars Refinery, India
- Orica Australia Pty. Ltd.
- GAC Shipping (India) Pvt Ltd
- Vizag Seaport Private Limited - India
- Sojitz Corporation - Japan
- Sakthi Sugars Limited - India
- Directorate General of MIneral and Coal - Indonesia
- The Treasury - Australian Government
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
- PNOC Exploration Corporation - Philippines
- Electricity Generating Authority of Thailand
- TeaM Sual Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- Thiess Contractors Indonesia
- Mercuria Energy - Indonesia
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- European Bulk Services B.V. - Netherlands
- Essar Steel Hazira Ltd - India
- LBH Netherlands Bv - Netherlands
- Sical Logistics Limited - India
- Meralco Power Generation, Philippines
- Toyota Tsusho Corporation, Japan
- Binh Thuan Hamico - Vietnam
- Indian Oil Corporation Limited
- Meenaskhi Energy Private Limited - India
- Kaltim Prima Coal - Indonesia
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Australian Commodity Traders Exchange
- San Jose City I Power Corp, Philippines
- Anglo American - United Kingdom
- Cement Manufacturers Association - India
- McConnell Dowell - Australia
- OPG Power Generation Pvt Ltd - India
- Eastern Energy - Thailand
- Bharathi Cement Corporation - India
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