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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, 09 August 11
INDONESIAS COAL PRODUCTION GREW BY 19.4% LAST YEAR - BP
COALspot.com - Indonesia’s coal production grew by 19.4% last year to 305.879 million tonnes from 256.181 million tonnes in 2009, the fastest ...
Tuesday, 09 August 11
DRY BULK MARKET UNABLE TO FIND UPWARD MOMENTUM, SLUMPS AGAIN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
They same that what goes up must come down and nobody seems to have found a better application of this expression, than the beleguered dry bulk mark ...
Monday, 08 August 11
OIL PRICES ARE SOFTENING, WILL IT INFLUENCE COAL PRICES?
COALspot.com - The current global economic condition is in volatility after a little chance of optimism for economic recovery.
Oil price at ...
Monday, 08 August 11
A SUPRAMAX VESSEL WAS REPORTED FIXED AT $ 12K - VISTAAR
COALspot.com - The BDI was slightly up by about 4 points closed at 1268 points which was supported by cape index which was up 3.14 pct and closed at ...
Saturday, 06 August 11
NTPC IS CONSIDERING TO ENTER INTO 25 YEARS COAL PURCHASE AGREEMENT
Indian, State-run power producer NTPC's present annual consumption is 164 million tonnes, and company is considering long-term agreements abroad to ...
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- Neyveli Lignite Corporation Ltd, - India
- Wood Mackenzie - Singapore
- Thiess Contractors Indonesia
- Attock Cement Pakistan Limited
- Tamil Nadu electricity Board
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- Kohat Cement Company Ltd. - Pakistan
- Orica Mining Services - Indonesia
- Uttam Galva Steels Limited - India
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Jindal Steel & Power Ltd - India
- Timah Investasi Mineral - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- The Treasury - Australian Government
- Petron Corporation, Philippines
- Malabar Cements Ltd - India
- Ministry of Transport, Egypt
- Chettinad Cement Corporation Ltd - India
- Thai Mozambique Logistica
- Indika Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Global Business Power Corporation, Philippines
- Sojitz Corporation - Japan
- Meralco Power Generation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercator Lines Limited - India
- Kideco Jaya Agung - Indonesia
- Lanco Infratech Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Therma Luzon, Inc, Philippines
- Altura Mining Limited, Indonesia
- Kobexindo Tractors - Indoneisa
- Rio Tinto Coal - Australia
- Global Green Power PLC Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Bayan Resources Tbk. - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Ind-Barath Power Infra Limited - India
- Central Electricity Authority - India
- Siam City Cement PLC, Thailand
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Africa Commodities Group - South Africa
- Aboitiz Power Corporation - Philippines
- Anglo American - United Kingdom
- Bukit Baiduri Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Indogreen Group - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Krishnapatnam Port Company Ltd. - India
- Standard Chartered Bank - UAE
- Ministry of Mines - Canada
- Indo Tambangraya Megah - Indonesia
- London Commodity Brokers - England
- Power Finance Corporation Ltd., India
- McConnell Dowell - Australia
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Posco Energy - South Korea
- Holcim Trading Pte Ltd - Singapore
- Kumho Petrochemical, South Korea
- Essar Steel Hazira Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Xindia Steels Limited - India
- Orica Australia Pty. Ltd.
- Independent Power Producers Association of India
- Australian Coal Association
- Parliament of New Zealand
- Medco Energi Mining Internasional
- Central Java Power - Indonesia
- Salva Resources Pvt Ltd - India
- Ambuja Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- LBH Netherlands Bv - Netherlands
- Simpson Spence & Young - Indonesia
- Electricity Authority, New Zealand
- Metalloyd Limited - United Kingdom
- San Jose City I Power Corp, Philippines
- Carbofer General Trading SA - India
- Sakthi Sugars Limited - India
- Kepco SPC Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Bukit Asam (Persero) Tbk - Indonesia
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- Vedanta Resources Plc - India
- Gujarat Sidhee Cement - India
- Kaltim Prima Coal - Indonesia
- Formosa Plastics Group - Taiwan
- SMG Consultants - Indonesia
- Commonwealth Bank - Australia
- Mjunction Services Limited - India
- Globalindo Alam Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tata Chemicals Ltd - India
- Coalindo Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Indian Energy Exchange, India
- International Coal Ventures Pvt Ltd - India
- Renaissance Capital - South Africa
- Latin American Coal - Colombia
- Georgia Ports Authority, United States
- Semirara Mining Corp, Philippines
- India Bulls Power Limited - India
- VISA Power Limited - India
- Singapore Mercantile Exchange
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- Iligan Light & Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Rashtriya Ispat Nigam Limited - India
- Sinarmas Energy and Mining - Indonesia
- ASAPP Information Group - India
- Madhucon Powers Ltd - India
- Pendopo Energi Batubara - Indonesia
- Jaiprakash Power Ventures ltd
- Alfred C Toepfer International GmbH - Germany
- The University of Queensland
- Billiton Holdings Pty Ltd - Australia
- Baramulti Group, Indonesia
- Minerals Council of Australia
- Savvy Resources Ltd - HongKong
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- IEA Clean Coal Centre - UK
- Kapuas Tunggal Persada - Indonesia
- Grasim Industreis Ltd - India
- GAC Shipping (India) Pvt Ltd
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Energy Link Ltd, New Zealand
- Manunggal Multi Energi - Indonesia
- Oldendorff Carriers - Singapore
- Banpu Public Company Limited - Thailand
- Binh Thuan Hamico - Vietnam
- Sree Jayajothi Cements Limited - India
- The State Trading Corporation of India Ltd
- CIMB Investment Bank - Malaysia
- ICICI Bank Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Bhoruka Overseas - Indonesia
- Chamber of Mines of South Africa
- Electricity Generating Authority of Thailand
- SN Aboitiz Power Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Marubeni Corporation - India
- Mercuria Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- GVK Power & Infra Limited - India
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mintek Dendrill Indonesia
- SMC Global Power, Philippines
- MS Steel International - UAE
- PTC India Limited - India
- Bangladesh Power Developement Board
- CNBM International Corporation - China
- Sical Logistics Limited - India
- Wilmar Investment Holdings
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- Cigading International Bulk Terminal - Indonesia
- Bulk Trading Sa - Switzerland
- Jorong Barutama Greston.PT - Indonesia
- Economic Council, Georgia
- Dalmia Cement Bharat India
- Straits Asia Resources Limited - Singapore
- Eastern Coal Council - USA
- OPG Power Generation Pvt Ltd - India
- PowerSource Philippines DevCo
- Goldman Sachs - Singapore
- Planning Commission, India
- Maheswari Brothers Coal Limited - India
- Sarangani Energy Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Price Waterhouse Coopers - Russia
- Port Waratah Coal Services - Australia
- Bukit Makmur.PT - Indonesia
- Aditya Birla Group - India
- Star Paper Mills Limited - India
- Directorate Of Revenue Intelligence - India
- Riau Bara Harum - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Indonesian Coal Mining Association
- Meenaskhi Energy Private Limited - India
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Videocon Industries ltd - India
- Interocean Group of Companies - India
- Petrochimia International Co. Ltd.- Taiwan
- GMR Energy Limited - India
- Global Coal Blending Company Limited - Australia
- Intertek Mineral Services - Indonesia
- Australian Commodity Traders Exchange
- Coal and Oil Company - UAE
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