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Wednesday, 03 August 16
SHIPPING MARKET INSIGHT - EVA TZIMA
 The Good…
Demand. Amidst all the unprecedented geopolitical turmoil and shifts in the likes of Brexit, the IMF lowered last month its global growth expectations but as far as growth in emerging market and developing economies is concerned, expectations were unaffected. 2016 is still expected to be the first year since 2010 that growth in these countries will pick up and this is great news for the dry bulk market, as these economies, accounting for more than 70% of global growth, are also the main drivers of dry bulk shipping.
The Bad…
Supply. A lot of hopes have been generated from scrapping activity in bigger sizes this year but the truth is that we still have a long way to go before tonnage supply gets down to a level that it can meaningfully support earnings. Let’s look at some figures in the >120,000dwt range. These vessels accounted for 295.07m dwt in January, while today, despite all the intense scrapping we are only down to 294.87m., which means that cancellations and slippage made little difference once some of the scheduled deliveries kicked in. Adding to that the 12.00m dwt that have been ordered since January (30 Valemaxes) against the 11.94m dwt that have been scrapped during the same period and the answer to the “Are we there yet?” question becomes not just a simple “Not yet.” but rather a big fat “Not even close”.
And the Ugly.
Overlapping. Ultramaxes, Kamsarmaxes, Post-Panamaxes.
Can we create a new size called Evamax please?
Was the dry bulk trade actually in need of these sizes or has the market been getting ahead of itself since the last shipping boom? Fact; as designs evolve, ships change in both their efficiency and size. But then again shouldn’t the latter be a long-term process during which the fleet of the older size gets to substantially decrease? And much more importantly a process during which actual demand and consequently charterers and traders dictate parcel size needs much more than shipbuilders? It is no wonder that the poor old Panamax has been squeezed from both below (Ultramaxes) and above (Kamsarmaxes) in the dwt range, while the modern Post-Panamax fleet has been also striving to survive, simultaneously chocking those already battered Capesize margins.
“Buy now”, “Buy later”, “The best trade is no trade”.
Different strategies, different risks, different hopes. Someone who buys today a “cheap” vessel could potentially make money from a recovery in asset prices down the line. But is just “cheap” the goal? Let’s assume that the long awaited recovery in the Dry Bulk market delays much further. That instead of a more clearly shaped “up we go” in the period leading to the eventual recovery we get a lot of mini cycles, during which the bottom is around OPEX and the ceiling not too way above. The current crisis in the dry bulk sector – as every crisis does - will undoubtedly generate a new cluster of prosperous shipowners. Whether in this specific crisis these will be the ones betting on a meaningful asset play in the next couple of years (achieved with bigger, more expensive sizes) or the ones investing in vessels that can find employment much easier during market downturns, is probably the question at hand. Investing in a size that can cover more commodities, more ports, has fewer operating expenses and let’s face it is not as easily “controlled” by bigger players, allows owners to not just bet on the asset’s appreciation – a rather risky bet if it takes much longer for the market to recover – but also operate their ships in a less challenging/volatile environment. After all, even though history does repeat itself during market cycles, the fundamentals during the times it does usually differ vastly.
By Eva Tzima
Research Analyst
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms. Eva Tzima
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Friday, 22 March 24
CASE STUDY: DANGERS OF COAL CARGO - SKULD
Recently, a bulk cargo vessel carrying coal from South Africa to Singapore suffered a fatal accident, resulting in the deaths of three crew members ...
Friday, 22 March 24
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Monday, 18 March 24
THREE KEY TAKEAWAYS FROM OUR EUROPE GAS MARKETS SHORT-TERM OUTLOOK Q1 2024 - WOOD MACKENZIE
European gas prices are currently back to pre-crisis levels, but with a complex series of factors affecting future supply and demand, are they set ...
Wednesday, 06 March 24
INDONESIA AIMS TO FINISH MINING OUTPUT QUOTAS APPROVAL BY END-MARCH, OFFICIAL SAYS - REUTERS
Indonesia’s has approved the mining production quotarequests from more than 120mineral companies and aims to complete the approval process th ...
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- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Uttam Galva Steels Limited - India
- PNOC Exploration Corporation - Philippines
- Parry Sugars Refinery, India
- Tamil Nadu electricity Board
- Commonwealth Bank - Australia
- Carbofer General Trading SA - India
- Directorate Of Revenue Intelligence - India
- Chamber of Mines of South Africa
- Malabar Cements Ltd - India
- Savvy Resources Ltd - HongKong
- SMG Consultants - Indonesia
- European Bulk Services B.V. - Netherlands
- Sakthi Sugars Limited - India
- Georgia Ports Authority, United States
- Ceylon Electricity Board - Sri Lanka
- Jaiprakash Power Ventures ltd
- CIMB Investment Bank - Malaysia
- Barasentosa Lestari - Indonesia
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- Energy Link Ltd, New Zealand
- International Coal Ventures Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Bharathi Cement Corporation - India
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Economic Council, Georgia
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Petrochimia International Co. Ltd.- Taiwan
- Videocon Industries ltd - India
- ICICI Bank Limited - India
- Lanco Infratech Ltd - India
- Altura Mining Limited, Indonesia
- Central Java Power - Indonesia
- Heidelberg Cement - Germany
- Port Waratah Coal Services - Australia
- Antam Resourcindo - Indonesia
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- OPG Power Generation Pvt Ltd - India
- Vedanta Resources Plc - India
- Sarangani Energy Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Medco Energi Mining Internasional
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Iligan Light & Power Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Petron Corporation, Philippines
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Bukit Makmur.PT - Indonesia
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Sical Logistics Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Parliament of New Zealand
- New Zealand Coal & Carbon
- Intertek Mineral Services - Indonesia
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- Latin American Coal - Colombia
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- Romanian Commodities Exchange
- Kalimantan Lumbung Energi - Indonesia
- Central Electricity Authority - India
- Thai Mozambique Logistica
- Global Coal Blending Company Limited - Australia
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- Indian Energy Exchange, India
- Posco Energy - South Korea
- Ministry of Mines - Canada
- Jindal Steel & Power Ltd - India
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Tata Chemicals Ltd - India
- PowerSource Philippines DevCo
- GAC Shipping (India) Pvt Ltd
- CNBM International Corporation - China
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- Eastern Coal Council - USA
- Miang Besar Coal Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Bangladesh Power Developement Board
- AsiaOL BioFuels Corp., Philippines
- Chettinad Cement Corporation Ltd - India
- Australian Commodity Traders Exchange
- Aditya Birla Group - India
- Baramulti Group, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- McConnell Dowell - Australia
- Cement Manufacturers Association - India
- Orica Mining Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kepco SPC Power Corporation, Philippines
- SMC Global Power, Philippines
- Salva Resources Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- White Energy Company Limited
- Sojitz Corporation - Japan
- TeaM Sual Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Globalindo Alam Lestari - Indonesia
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- Toyota Tsusho Corporation, Japan
- Agrawal Coal Company - India
- Trasteel International SA, Italy
- Meralco Power Generation, Philippines
- Independent Power Producers Association of India
- Africa Commodities Group - South Africa
- India Bulls Power Limited - India
- GVK Power & Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Indika Energy - Indonesia
- Minerals Council of Australia
- Kartika Selabumi Mining - Indonesia
- Anglo American - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Therma Luzon, Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Merrill Lynch Commodities Europe
- Renaissance Capital - South Africa
- Singapore Mercantile Exchange
- Pendopo Energi Batubara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Formosa Plastics Group - Taiwan
- Sindya Power Generating Company Private Ltd
- Coalindo Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Standard Chartered Bank - UAE
- Aboitiz Power Corporation - Philippines
- Goldman Sachs - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- Ministry of Transport, Egypt
- Planning Commission, India
- Star Paper Mills Limited - India
- Sinarmas Energy and Mining - Indonesia
- Gujarat Sidhee Cement - India
- Bhoruka Overseas - Indonesia
- Larsen & Toubro Limited - India
- Oldendorff Carriers - Singapore
- Coal and Oil Company - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asmin Koalindo Tuhup - Indonesia
- Edison Trading Spa - Italy
- Kapuas Tunggal Persada - Indonesia
- Indogreen Group - Indonesia
- Dalmia Cement Bharat India
- Billiton Holdings Pty Ltd - Australia
- Banpu Public Company Limited - Thailand
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- Bhatia International Limited - India
- Kideco Jaya Agung - Indonesia
- Thiess Contractors Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bukit Baiduri Energy - Indonesia
- Electricity Authority, New Zealand
- Electricity Generating Authority of Thailand
- Karbindo Abesyapradhi - Indoneisa
- Essar Steel Hazira Ltd - India
- Timah Investasi Mineral - Indoneisa
- TNB Fuel Sdn Bhd - Malaysia
- Kumho Petrochemical, South Korea
- Wood Mackenzie - Singapore
- Australian Coal Association
- Ministry of Finance - Indonesia
- Samtan Co., Ltd - South Korea
- Orica Australia Pty. Ltd.
- Manunggal Multi Energi - Indonesia
- Rio Tinto Coal - Australia
- Siam City Cement PLC, Thailand
- Holcim Trading Pte Ltd - Singapore
- London Commodity Brokers - England
- Metalloyd Limited - United Kingdom
- Indonesian Coal Mining Association
- Indian Oil Corporation Limited
- Price Waterhouse Coopers - Russia
- Borneo Indobara - Indonesia
- Energy Development Corp, Philippines
- The University of Queensland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- San Jose City I Power Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- Riau Bara Harum - Indonesia
- Xindia Steels Limited - India
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