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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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Sunday, 18 September 11
THE COAL IMPORTS TO INDIA, OUT OF INDONESIA LIKELY TO PICK UP - CAPT. REDDY
COALspot.com - The freight market continued the upward trend until midweek almost touching 2,000 points, however towards second half of the week the ...
Saturday, 17 September 11
GVK ACQUIRES HANCOCK COAL AND INFRASTRUCTURE FOR US$ 1.26 BILLION
COALspot.com - GVK group, India’s leading infrastructure developer,confirmed arrangements for the acquisition of a strategic part of large, hi ...
Saturday, 17 September 11
INDIA'S GVK ACQUIRES HANCOCK COAL AND INFRASTRUCTURE PROJECTS IN AUSTRALIA
COALspot.com - GVK group, India’s leading infrastructure developer, today confirmed arrangements for the acquisition of a strategic part of la ...
Friday, 16 September 11
DELTA DUNIA MAKMUR REMOVED 30.9 MILLION BCM OVERBURDEN IN AUGUST 2011
COALspot.com - PT. Delta Dunia Makmur Tbk has removed 30.9 million bcm (+13.2% YoY) overburden in August 2011 while coal production was at 2.9 ...
Thursday, 15 September 11
RUSSIAN COAL EXPORTS UP 10.9% IN JAN-AUG TO 71.50 MILLION TONS - PORT NEWS / HELLENIC SHIPPING
Port News reported that, Coal exports from Russia in January-August 2011 grew by 10.9% compared with the same period last year, to 71.50 million ton ...
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- Makarim & Taira - Indonesia
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- Bharathi Cement Corporation - India
- Minerals Council of Australia
- Power Finance Corporation Ltd., India
- Karaikal Port Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Tamil Nadu electricity Board
- Jorong Barutama Greston.PT - Indonesia
- Central Electricity Authority - India
- Global Coal Blending Company Limited - Australia
- Ministry of Finance - Indonesia
- Formosa Plastics Group - Taiwan
- Interocean Group of Companies - India
- TeaM Sual Corporation - Philippines
- Antam Resourcindo - Indonesia
- IHS Mccloskey Coal Group - USA
- Coastal Gujarat Power Limited - India
- Ministry of Transport, Egypt
- Global Green Power PLC Corporation, Philippines
- Medco Energi Mining Internasional
- Wilmar Investment Holdings
- European Bulk Services B.V. - Netherlands
- GMR Energy Limited - India
- Gujarat Sidhee Cement - India
- Mercator Lines Limited - India
- Agrawal Coal Company - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Larsen & Toubro Limited - India
- Barasentosa Lestari - Indonesia
- Electricity Generating Authority of Thailand
- Malabar Cements Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- Eastern Energy - Thailand
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Petrochimia International Co. Ltd.- Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- Rio Tinto Coal - Australia
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- India Bulls Power Limited - India
- Aditya Birla Group - India
- Karbindo Abesyapradhi - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Chamber of Mines of South Africa
- Bahari Cakrawala Sebuku - Indonesia
- Commonwealth Bank - Australia
- GAC Shipping (India) Pvt Ltd
- Sree Jayajothi Cements Limited - India
- Rashtriya Ispat Nigam Limited - India
- Parry Sugars Refinery, India
- Edison Trading Spa - Italy
- Indo Tambangraya Megah - Indonesia
- Borneo Indobara - Indonesia
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Kartika Selabumi Mining - Indonesia
- Goldman Sachs - Singapore
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Pendopo Energi Batubara - Indonesia
- Toyota Tsusho Corporation, Japan
- Mercuria Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- Asmin Koalindo Tuhup - Indonesia
- The State Trading Corporation of India Ltd
- Neyveli Lignite Corporation Ltd, - India
- PTC India Limited - India
- Petron Corporation, Philippines
- Vizag Seaport Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Intertek Mineral Services - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Renaissance Capital - South Africa
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- Videocon Industries ltd - India
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- London Commodity Brokers - England
- The University of Queensland
- Therma Luzon, Inc, Philippines
- San Jose City I Power Corp, Philippines
- CNBM International Corporation - China
- Baramulti Group, Indonesia
- SMC Global Power, Philippines
- Simpson Spence & Young - Indonesia
- Merrill Lynch Commodities Europe
- Vedanta Resources Plc - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- SN Aboitiz Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- LBH Netherlands Bv - Netherlands
- Price Waterhouse Coopers - Russia
- Indika Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kideco Jaya Agung - Indonesia
- Riau Bara Harum - Indonesia
- Iligan Light & Power Inc, Philippines
- Meralco Power Generation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Romanian Commodities Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Anglo American - United Kingdom
- Sakthi Sugars Limited - India
- Parliament of New Zealand
- Coalindo Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Straits Asia Resources Limited - Singapore
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Salva Resources Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Kepco SPC Power Corporation, Philippines
- McConnell Dowell - Australia
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Indonesian Coal Mining Association
- Global Business Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Central Java Power - Indonesia
- Australian Commodity Traders Exchange
- Siam City Cement - Thailand
- Kalimantan Lumbung Energi - Indonesia
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- Directorate General of MIneral and Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- Mjunction Services Limited - India
- SMG Consultants - Indonesia
- Orica Mining Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Indian Oil Corporation Limited
- GVK Power & Infra Limited - India
- Deloitte Consulting - India
- PowerSource Philippines DevCo
- Trasteel International SA, Italy
- Ceylon Electricity Board - Sri Lanka
- Ambuja Cements Ltd - India
- Planning Commission, India
- Gujarat Electricity Regulatory Commission - India
- Independent Power Producers Association of India
- Oldendorff Carriers - Singapore
- VISA Power Limited - India
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- South Luzon Thermal Energy Corporation
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining Corp, Philippines
- Indian Energy Exchange, India
- Bangladesh Power Developement Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Manunggal Multi Energi - Indonesia
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Tata Chemicals Ltd - India
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Sical Logistics Limited - India
- Singapore Mercantile Exchange
- IEA Clean Coal Centre - UK
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- MS Steel International - UAE
- Semirara Mining and Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Ind-Barath Power Infra Limited - India
- Jaiprakash Power Ventures ltd
- Economic Council, Georgia
- Electricity Authority, New Zealand
- Australian Coal Association
- Jindal Steel & Power Ltd - India
- Bayan Resources Tbk. - Indonesia
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- Orica Australia Pty. Ltd.
- Georgia Ports Authority, United States
- Kobexindo Tractors - Indoneisa
- Binh Thuan Hamico - Vietnam
- Directorate Of Revenue Intelligence - India
- Sojitz Corporation - Japan
- Heidelberg Cement - Germany
- Maheswari Brothers Coal Limited - India
- Attock Cement Pakistan Limited
- Billiton Holdings Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- International Coal Ventures Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Samtan Co., Ltd - South Korea
- Star Paper Mills Limited - India
- Xindia Steels Limited - India
- CIMB Investment Bank - Malaysia
- Leighton Contractors Pty Ltd - Australia
- Carbofer General Trading SA - India
- Africa Commodities Group - South Africa
- Latin American Coal - Colombia
- Siam City Cement PLC, Thailand
- The Treasury - Australian Government
- White Energy Company Limited
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