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Saturday, 17 April 10
DRY BULK SHIPPING MARKET ANALYSIS - BIMCO
 Strong Chinese steel market is set to cushion the flood of new Capesize vessels entering the dry bulk fleet Demand: The first quarter of 2010 saw ups and down for the BDI with the index hovering around 3,000. It seems as if the market is balanced on a knife edge. High supply is likely to overmatch even very healthy demand growth rates – strongly dependant on China.
Chinese iron ore imports continue to remain firm. In the first quarter of this year, China has imported an average of 51.68 million tons (mt) of ore. In 2009, iron ore imports reached a monthly average of 52.37mt, leaving this year’s ore imports just 1% short of 2009 levels, but still very healthy at 14.7mt (40%) more than 2008 levels. With steel prices rising above those of 2009 – Chinese iron ore imports will continue as the prime driver in the dry bulk market.
However, the present spot rates are not expected to stay that low as time charter rates stay strong as illustrated by the reported BHP Billiton booking of a Capesize vessel for 3-5 months at USD/day 37,000 - more than 30% premium to spot. The current FFA (Forward Freight Agreement) rates also point in that direction with Capesize Q2 FFA going up to USD/day 35,750 and Panamax Q2 going down to USD/day 28,500.
Supply:
The active fleet has grown by 3.5% during first quarter of 2010, caused by deliveries of 16 million DWT of newbuildings offset by just 1 million DWT being demolished. Since BIMCO Bulletin 1/2010, the total dry bulk order book has increased by 5.5 million DWT. It seems as though the optimism from surprisingly healthy freight rate levels in 2009 has made contracting go on – despite the fact that the 285 million DWT that comprises the order book today is doomed to make challenging markets in short as well as long-term.
Year-to-date deliveries in capesize amount to 47 ships comprising 8.7 million new DWT, resulting in an increased fleet size of 5% so far in 2010 and active Capesize vessel number 1,000 has just been delivered. At the beginning of 2009, 822 Capesize vessels were active, but an inflow of 112 newbuildings and 29 converted vessels was added to the existing fleet, counterbalanced by just 9 demolitions, leaving a fleet tonnage growth of 18.5% in 2009.
An additional 305 Capesize vessels are scheduled for delivery in 2010, but “only” 183 will hit the water, when applying the BIMCO assumptions for supply forecast as described next to the graphics. In total, this will in turn mean that Capesize tonnage could grow by 21% when fine-tuning for an average scrapping age of 26 years for Capesize vessels
as compared to the average of 30 years for the overall fleet.
BIMCO forecasts inflow of new dry bulk tonnage in 2010 to reach 76 million DWT, offset by demolition of as much as 13 million DWT. This could make the fleet grow by 14% in 2010 as compared to 10% in 2009. Deliveries in 2011 are forecast to be even higher before supply growth comes down in 2012.
Clarkson’s have scheduled deliveries of 120-130 million DWT in 2010. BIMCO assumes that 10% of the entire order book will not be built and one third of the rest will be deferred by one year. Furthermore, the demolition potential is calculated to 49 million DWT, equal to all vessels aged 30 or above to be demolished by the end of 2013.
Outlook:
The fortunes of the dry bulk markets are basically down to the fortunes of China. March was the 13th straight month that the official Chinese PMI (Purchasing Managers Index) has stood above the threshold of 50 that demarcates expansion from contraction, indicating that the Chinese economy is on a stable and relatively fast growth track. PMI rose to 55.1% in March, up 3.1% on last month, according to data released by the China Federation of Logistics & Purchasing.
The housing market and huge infrastructure projects have been primary beneficiaries of the Chinese Government’s stimulus package. With the construction sector being the number one steel user, consuming around 50% of Chinese steel, it goes without saying that a continuance of the strength in this sector is vital for the health of the dry bulk freight rates.
Freight rates are forecast by MSI to drift sideways on current levels over the next 6 months. Capesize rates are forecast to stay around USD 30-35,000 per day while the smaller vessel types could see rates go down from current levels to around USD 16-24,000 per day.
Current news:
BHP Billiton has reached agreement to sell the majority of its iron ore to Asian steel mills on shorter term contracts, ending more than 40 years of annual pricing. Brazilian Vale have also inked new iron ore prices – resulting in price hikes of around 90%– indicating a continued strong demand for the vital raw material in steel production. Contract prices for coking coal are also expected higher.
Meanwhile, the China-Rio Tinto bribery case has just been settled. The court in Shanghai sentenced the four convicted Australian mining giant Rio Tinto employees to prison for a total 39 years. They were found guilty after having admitted to accepting about USD 13 million in bribes from private steel mills that wanted to avoid purchasing iron ore from more costly state-run mills. The arrangement undercut the state’s China Iron and Steel Association’s desire for a united front in negotiating with Australian suppliers. Shortly after the verdict the employees were sacked for clear violation of Chinese Law and Rio Tinto’s code of conduct. China claims its steel sector paid as much at USD 160 million too much last year for iron ore because of bribery and espionage. While the three Chinese defendants have decided to appeal terms, the Australian national Stern Hu appears to be the only one not appealing terms.
Source: Bimco / Hellenic Shipping
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Tuesday, 01 November 11
ATLAS RESOURCES SETS IPO AT RP1,500 - INSIDER STORIES
Insider Stories reported that, coal miner PT Atlas Resources Tbk has set its initial public offering (IPO) at Rp1,500 (approximately US$ 0.169) per ...
Tuesday, 01 November 11
DRY BULK MARKETS CORRECTION SPILLS OVER ONTO NEW WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market is losing steam, as evidenced by the falls experienced last week, which were also apparent at the beginning of the new week. A l ...
Monday, 31 October 11
CHINAS HUNGER FOR INDONESIAN COAL AT THREE YEAR-HIGH AS WINTER NEARS - JOSEPH KIRSCHKE
COALspot.com - Chinese demand for power-station coal from Indonesia has soared to its highest level in three years, as central heating plants and po ...
Saturday, 29 October 11
ATLAS RESOURCES SEALS US$95 MIO LOAN - INSIDER STORIES
Insider Stories reported that, coal producer PT Atlas Resources Tbk, that is controlled by Indonesian businessman Andre Abdi, has secured US$95 mill ...
Saturday, 29 October 11
INDONESIA TO INDIA FREIGHT LIKELY TO REMAIN SOFT
COALspot.com - The market continued to slow down and all segment were down this week.
The biggest drop was in the Cape Index down by 8.19 pct&nbs ...
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- ASAPP Information Group - India
- Planning Commission, India
- Indian Oil Corporation Limited
- Cement Manufacturers Association - India
- Timah Investasi Mineral - Indoneisa
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- PNOC Exploration Corporation - Philippines
- PowerSource Philippines DevCo
- Energy Link Ltd, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Siam City Cement - Thailand
- AsiaOL BioFuels Corp., Philippines
- Therma Luzon, Inc, Philippines
- Heidelberg Cement - Germany
- Ministry of Finance - Indonesia
- Deloitte Consulting - India
- Global Green Power PLC Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Ceylon Electricity Board - Sri Lanka
- Rio Tinto Coal - Australia
- SMC Global Power, Philippines
- Bukit Makmur.PT - Indonesia
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Bangladesh Power Developement Board
- Sree Jayajothi Cements Limited - India
- Vizag Seaport Private Limited - India
- Bhatia International Limited - India
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Dalmia Cement Bharat India
- Australian Coal Association
- The Treasury - Australian Government
- GAC Shipping (India) Pvt Ltd
- Anglo American - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Star Paper Mills Limited - India
- Energy Development Corp, Philippines
- Electricity Generating Authority of Thailand
- Orica Australia Pty. Ltd.
- Indika Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- The University of Queensland
- Georgia Ports Authority, United States
- Bulk Trading Sa - Switzerland
- Edison Trading Spa - Italy
- Makarim & Taira - Indonesia
- Mjunction Services Limited - India
- Krishnapatnam Port Company Ltd. - India
- Wood Mackenzie - Singapore
- Salva Resources Pvt Ltd - India
- Independent Power Producers Association of India
- Uttam Galva Steels Limited - India
- Sakthi Sugars Limited - India
- Metalloyd Limited - United Kingdom
- South Luzon Thermal Energy Corporation
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Mines - Canada
- Sojitz Corporation - Japan
- Global Business Power Corporation, Philippines
- Posco Energy - South Korea
- Kobexindo Tractors - Indoneisa
- Goldman Sachs - Singapore
- Karaikal Port Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Simpson Spence & Young - Indonesia
- Tamil Nadu electricity Board
- TeaM Sual Corporation - Philippines
- Petron Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- GMR Energy Limited - India
- Wilmar Investment Holdings
- Indogreen Group - Indonesia
- Bharathi Cement Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Attock Cement Pakistan Limited
- Marubeni Corporation - India
- Chamber of Mines of South Africa
- Semirara Mining and Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Central Java Power - Indonesia
- Borneo Indobara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- IHS Mccloskey Coal Group - USA
- SMG Consultants - Indonesia
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Alfred C Toepfer International GmbH - Germany
- Bhushan Steel Limited - India
- Intertek Mineral Services - Indonesia
- Grasim Industreis Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- TNB Fuel Sdn Bhd - Malaysia
- LBH Netherlands Bv - Netherlands
- Sindya Power Generating Company Private Ltd
- Indo Tambangraya Megah - Indonesia
- European Bulk Services B.V. - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Economic Council, Georgia
- Semirara Mining Corp, Philippines
- Kumho Petrochemical, South Korea
- Coastal Gujarat Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Miang Besar Coal Terminal - Indonesia
- Meenaskhi Energy Private Limited - India
- Commonwealth Bank - Australia
- IEA Clean Coal Centre - UK
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Savvy Resources Ltd - HongKong
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Interocean Group of Companies - India
- Trasteel International SA, Italy
- Maharashtra Electricity Regulatory Commission - India
- PetroVietnam Power Coal Import and Supply Company
- Port Waratah Coal Services - Australia
- Parliament of New Zealand
- Bhoruka Overseas - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Oldendorff Carriers - Singapore
- PTC India Limited - India
- Altura Mining Limited, Indonesia
- MS Steel International - UAE
- Gujarat Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Kartika Selabumi Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Essar Steel Hazira Ltd - India
- Parry Sugars Refinery, India
- VISA Power Limited - India
- Minerals Council of Australia
- Larsen & Toubro Limited - India
- Iligan Light & Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- SN Aboitiz Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Romanian Commodities Exchange
- Cigading International Bulk Terminal - Indonesia
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Xindia Steels Limited - India
- Carbofer General Trading SA - India
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- Ind-Barath Power Infra Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Tata Chemicals Ltd - India
- Mercuria Energy - Indonesia
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Coalindo Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- Gujarat Sidhee Cement - India
- McConnell Dowell - Australia
- Central Electricity Authority - India
- Latin American Coal - Colombia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- Mintek Dendrill Indonesia
- Singapore Mercantile Exchange
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Africa Commodities Group - South Africa
- Indian Energy Exchange, India
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Eastern Coal Council - USA
- Karbindo Abesyapradhi - Indoneisa
- The State Trading Corporation of India Ltd
- Mercator Lines Limited - India
- Aboitiz Power Corporation - Philippines
- Medco Energi Mining Internasional
- Ambuja Cements Ltd - India
- Merrill Lynch Commodities Europe
- Thai Mozambique Logistica
- Rashtriya Ispat Nigam Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Videocon Industries ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- London Commodity Brokers - England
- Bank of Tokyo Mitsubishi UFJ Ltd
- OPG Power Generation Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Kideco Jaya Agung - Indonesia
- Madhucon Powers Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Standard Chartered Bank - UAE
- Bahari Cakrawala Sebuku - Indonesia
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