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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, 02 August 24
COAL MARKET DEVELOPMENTS: FALLING PRICES AMID RECORD-HIGH OUTPUT - WORLD BANK
Coal prices inched up in May (m/m) following an 8 percent decline in 2024Q1. The Australian and South African benchmarks have plummeted more ...
Friday, 26 July 24
FUELEU MARITME IS COMING. IS YOUR CHARTERPARTY READY? - GARD
With less than six months to implementation of FuelEU Maritime in EU and EEA trades, there has been little published advice regarding how to alloca ...
Thursday, 04 July 24
INDIA'S COAL PRODUCTION RISES 14% IN JUNE - PTI
The country’s coal production rose by 14.49% to 84.63 million tonne (MT) in June. The country’s coal output was 73.92 MT in June last f ...
Tuesday, 02 July 24
NTPC CAPTIVE COAL OUTPUT GROWS 15% IN Q1; DESPATCH RISES 17%
State-owned NTPC on Monday reported a 15 per cent year-on-year increase in the production of coal from captives mines to 9.862 metric million tonne ...
Friday, 28 June 24
KOSPO INVITED BIDS FOR 400,000 MT OF MINIMUM 4000 NCV COAL FOR FIVE YEARS
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for total 400,000 MT of Low Calorific Value Coal for 5 years starting from July 2024 until ...
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- Formosa Plastics Group - Taiwan
- Price Waterhouse Coopers - Russia
- Renaissance Capital - South Africa
- Cigading International Bulk Terminal - Indonesia
- Edison Trading Spa - Italy
- Bahari Cakrawala Sebuku - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Bhushan Steel Limited - India
- New Zealand Coal & Carbon
- Romanian Commodities Exchange
- Dalmia Cement Bharat India
- Globalindo Alam Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- SN Aboitiz Power Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Rio Tinto Coal - Australia
- Trasteel International SA, Italy
- Malabar Cements Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Kideco Jaya Agung - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Economic Council, Georgia
- Goldman Sachs - Singapore
- LBH Netherlands Bv - Netherlands
- Videocon Industries ltd - India
- Indian Energy Exchange, India
- Thiess Contractors Indonesia
- AsiaOL BioFuels Corp., Philippines
- Maharashtra Electricity Regulatory Commission - India
- Banpu Public Company Limited - Thailand
- White Energy Company Limited
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- Rashtriya Ispat Nigam Limited - India
- Bhatia International Limited - India
- Central Java Power - Indonesia
- Ambuja Cements Ltd - India
- Standard Chartered Bank - UAE
- San Jose City I Power Corp, Philippines
- Star Paper Mills Limited - India
- Miang Besar Coal Terminal - Indonesia
- PowerSource Philippines DevCo
- Deloitte Consulting - India
- SMG Consultants - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- International Coal Ventures Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- Metalloyd Limited - United Kingdom
- Bank of Tokyo Mitsubishi UFJ Ltd
- The Treasury - Australian Government
- India Bulls Power Limited - India
- Eastern Coal Council - USA
- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- MS Steel International - UAE
- Ministry of Mines - Canada
- Tamil Nadu electricity Board
- Gujarat Sidhee Cement - India
- PNOC Exploration Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Merrill Lynch Commodities Europe
- Orica Mining Services - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sical Logistics Limited - India
- Essar Steel Hazira Ltd - India
- Indogreen Group - Indonesia
- Madhucon Powers Ltd - India
- Chamber of Mines of South Africa
- Coal and Oil Company - UAE
- Commonwealth Bank - Australia
- Borneo Indobara - Indonesia
- Directorate Of Revenue Intelligence - India
- Vijayanagar Sugar Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Port Waratah Coal Services - Australia
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Marubeni Corporation - India
- Heidelberg Cement - Germany
- Agrawal Coal Company - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meenaskhi Energy Private Limited - India
- Central Electricity Authority - India
- Electricity Authority, New Zealand
- The University of Queensland
- Riau Bara Harum - Indonesia
- Salva Resources Pvt Ltd - India
- Thai Mozambique Logistica
- Mjunction Services Limited - India
- Indonesian Coal Mining Association
- Indian Oil Corporation Limited
- Straits Asia Resources Limited - Singapore
- Mercuria Energy - Indonesia
- Planning Commission, India
- Wilmar Investment Holdings
- Global Coal Blending Company Limited - Australia
- Anglo American - United Kingdom
- Medco Energi Mining Internasional
- Holcim Trading Pte Ltd - Singapore
- Kobexindo Tractors - Indoneisa
- Ministry of Finance - Indonesia
- Meralco Power Generation, Philippines
- London Commodity Brokers - England
- Iligan Light & Power Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Sojitz Corporation - Japan
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Jindal Steel & Power Ltd - India
- Leighton Contractors Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- GVK Power & Infra Limited - India
- Krishnapatnam Port Company Ltd. - India
- Samtan Co., Ltd - South Korea
- Barasentosa Lestari - Indonesia
- Siam City Cement PLC, Thailand
- Coastal Gujarat Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- Global Business Power Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Timah Investasi Mineral - Indoneisa
- Parry Sugars Refinery, India
- Aboitiz Power Corporation - Philippines
- Australian Commodity Traders Exchange
- Larsen & Toubro Limited - India
- Wood Mackenzie - Singapore
- GMR Energy Limited - India
- OPG Power Generation Pvt Ltd - India
- Mintek Dendrill Indonesia
- Parliament of New Zealand
- Singapore Mercantile Exchange
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- Toyota Tsusho Corporation, Japan
- Billiton Holdings Pty Ltd - Australia
- ICICI Bank Limited - India
- Intertek Mineral Services - Indonesia
- SMC Global Power, Philippines
- Sree Jayajothi Cements Limited - India
- Lanco Infratech Ltd - India
- Carbofer General Trading SA - India
- GN Power Mariveles Coal Plant, Philippines
- CNBM International Corporation - China
- ASAPP Information Group - India
- Interocean Group of Companies - India
- Tata Chemicals Ltd - India
- Cement Manufacturers Association - India
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- Orica Australia Pty. Ltd.
- Electricity Generating Authority of Thailand
- Kalimantan Lumbung Energi - Indonesia
- Independent Power Producers Association of India
- Indo Tambangraya Megah - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Antam Resourcindo - Indonesia
- Simpson Spence & Young - Indonesia
- Sarangani Energy Corporation, Philippines
- Latin American Coal - Colombia
- Bharathi Cement Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- Bukit Makmur.PT - Indonesia
- Power Finance Corporation Ltd., India
- Georgia Ports Authority, United States
- McConnell Dowell - Australia
- Oldendorff Carriers - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- CIMB Investment Bank - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Coalindo Energy - Indonesia
- Indika Energy - Indonesia
- Siam City Cement - Thailand
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- VISA Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Africa Commodities Group - South Africa
- Kepco SPC Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Therma Luzon, Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Minerals Council of Australia
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Mercator Lines Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- IHS Mccloskey Coal Group - USA
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