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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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Friday, 19 August 11
AUSTRALIAS' ATH TO ACQUIRE 60% OF APUAH COAL MINE IN INDONESIA
COALspot.com - Australian listed company, Atech Holdings Limited (ATH) has entered into a conditional binding term sheet to acquire 60 percent stake ...
Friday, 19 August 11
INDIA IMPORTS LESS INDONESIAN COAL THAN CHINA IN JULY
COALspot.com - Indonesia shipped 31.30 Million tons of coal in July 2011, up by 10.69 percent compared to June's export of about 28.27 ...
Thursday, 18 August 11
INDONESIAS PROPOSED LOW GRADE COAL EXPORT BAN WILL NOT HAVE A SIGNIFICANT IMPACT ON INDIA - MISWIN MAHESH
COALspot.com - The Indonesian government is currently in the process of drafting a new regulation that could ban the export of low-grade coal by Jan ...
Thursday, 18 August 11
MARUBENI ACQUIRED 42.86% OF YTL JAWA POWER
COALspot.com - Marubeni Corporation (Marubeni) has completed the acquisition of 42.86 percent of the shares of YTL Jawa Power Holdings BV from YTL P ...
Wednesday, 17 August 11
CME LAUNCHES ARGUS COKING COAL SWAP FUTURES
COALspot.com - Argus media reported that, leading exchange CME Group will list an Australian coking coal swap futures contract for trading on the Ny ...
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- Electricity Authority, New Zealand
- Global Business Power Corporation, Philippines
- Mintek Dendrill Indonesia
- Chamber of Mines of South Africa
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Sidhee Cement - India
- Lanco Infratech Ltd - India
- Eastern Coal Council - USA
- Petrochimia International Co. Ltd.- Taiwan
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Grasim Industreis Ltd - India
- Riau Bara Harum - Indonesia
- IEA Clean Coal Centre - UK
- Neyveli Lignite Corporation Ltd, - India
- Indika Energy - Indonesia
- Semirara Mining Corp, Philippines
- Wood Mackenzie - Singapore
- Georgia Ports Authority, United States
- European Bulk Services B.V. - Netherlands
- PNOC Exploration Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Altura Mining Limited, Indonesia
- CIMB Investment Bank - Malaysia
- Indo Tambangraya Megah - Indonesia
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Borneo Indobara - Indonesia
- Edison Trading Spa - Italy
- Romanian Commodities Exchange
- Kepco SPC Power Corporation, Philippines
- Anglo American - United Kingdom
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Jindal Steel & Power Ltd - India
- Global Green Power PLC Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Xindia Steels Limited - India
- Baramulti Group, Indonesia
- LBH Netherlands Bv - Netherlands
- Energy Link Ltd, New Zealand
- PowerSource Philippines DevCo
- Savvy Resources Ltd - HongKong
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Africa Commodities Group - South Africa
- McConnell Dowell - Australia
- Coal and Oil Company - UAE
- The Treasury - Australian Government
- Global Coal Blending Company Limited - Australia
- Videocon Industries ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Independent Power Producers Association of India
- Bharathi Cement Corporation - India
- Eastern Energy - Thailand
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- IHS Mccloskey Coal Group - USA
- Aboitiz Power Corporation - Philippines
- Thiess Contractors Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercuria Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- SMC Global Power, Philippines
- Madhucon Powers Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Singapore Mercantile Exchange
- Rio Tinto Coal - Australia
- Cement Manufacturers Association - India
- Semirara Mining and Power Corporation, Philippines
- Parliament of New Zealand
- Globalindo Alam Lestari - Indonesia
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bhoruka Overseas - Indonesia
- Central Electricity Authority - India
- Indian Energy Exchange, India
- Attock Cement Pakistan Limited
- Ambuja Cements Ltd - India
- Agrawal Coal Company - India
- Vedanta Resources Plc - India
- Oldendorff Carriers - Singapore
- Bhatia International Limited - India
- Heidelberg Cement - Germany
- Manunggal Multi Energi - Indonesia
- MS Steel International - UAE
- India Bulls Power Limited - India
- Planning Commission, India
- Intertek Mineral Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Bukit Baiduri Energy - Indonesia
- Interocean Group of Companies - India
- Ministry of Finance - Indonesia
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- Ceylon Electricity Board - Sri Lanka
- Meralco Power Generation, Philippines
- Price Waterhouse Coopers - Russia
- Mjunction Services Limited - India
- Aditya Birla Group - India
- Gujarat Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- Goldman Sachs - Singapore
- Electricity Generating Authority of Thailand
- Makarim & Taira - Indonesia
- South Luzon Thermal Energy Corporation
- Port Waratah Coal Services - Australia
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bhushan Steel Limited - India
- Kaltim Prima Coal - Indonesia
- Petron Corporation, Philippines
- Energy Development Corp, Philippines
- Orica Australia Pty. Ltd.
- Ministry of Transport, Egypt
- Merrill Lynch Commodities Europe
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Jaiprakash Power Ventures ltd
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Formosa Plastics Group - Taiwan
- Gujarat Mineral Development Corp Ltd - India
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- Wilmar Investment Holdings
- Commonwealth Bank - Australia
- Kideco Jaya Agung - Indonesia
- Malabar Cements Ltd - India
- Posco Energy - South Korea
- Kobexindo Tractors - Indoneisa
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- White Energy Company Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GMR Energy Limited - India
- Latin American Coal - Colombia
- Directorate General of MIneral and Coal - Indonesia
- ASAPP Information Group - India
- Indian Oil Corporation Limited
- Tata Chemicals Ltd - India
- Standard Chartered Bank - UAE
- Kartika Selabumi Mining - Indonesia
- Vizag Seaport Private Limited - India
- Karaikal Port Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parry Sugars Refinery, India
- Pendopo Energi Batubara - Indonesia
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Indogreen Group - Indonesia
- Carbofer General Trading SA - India
- Barasentosa Lestari - Indonesia
- Medco Energi Mining Internasional
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- Chettinad Cement Corporation Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Minerals Council of Australia
- Marubeni Corporation - India
- International Coal Ventures Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- Larsen & Toubro Limited - India
- Star Paper Mills Limited - India
- SN Aboitiz Power Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Orica Mining Services - Indonesia
- VISA Power Limited - India
- Bukit Makmur.PT - Indonesia
- Australian Commodity Traders Exchange
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- PTC India Limited - India
- Australian Coal Association
- Cigading International Bulk Terminal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Mines - Canada
- Central Java Power - Indonesia
- Binh Thuan Hamico - Vietnam
- Uttam Galva Steels Limited - India
- Deloitte Consulting - India
- ICICI Bank Limited - India
- Essar Steel Hazira Ltd - India
- Coalindo Energy - Indonesia
- Mercator Lines Limited - India
- TeaM Sual Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Meenaskhi Energy Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Renaissance Capital - South Africa
- GVK Power & Infra Limited - India
- Sakthi Sugars Limited - India
- Iligan Light & Power Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Metalloyd Limited - United Kingdom
- Kalimantan Lumbung Energi - Indonesia
- London Commodity Brokers - England
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement - Thailand
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