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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, 10 July 11
PTBA INCREASES SHARES IN COAL TRAIN PROJECT - TEMPO INTERACTIVE
TEMPO Interactive reported that, PT Tambang Batubara Bukit Asam (PTBA) is still studying the plan to buy 20 percent of shares in the PT Bukit Asam T ...
Sunday, 10 July 11
DRY BULK MARKET SHOWING SIGNS OF IMPROVEMENT - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Stronger Capesize demand has helped propel the dry bulk market forward this week, with the Baltic Dry Index (BDI) ending yesterday’s session u ...
Sunday, 10 July 11
INDONESIAN BAYAN RESOURCES TO SUPPLY 100 MILLION TONS OF COAL TO INDIAN UNIVERSAL SUCCESS ENTERPRISES LIMITED
Coal miner PT Bayan Resources Tbk (BYAN), that is owned by Dato' Low Tuck Kwong, has entered into a conditional sales and purchase agreement to sup ...
Thursday, 07 July 11
BELOW 5100 COAL WILL BE BANNED FOR EXPORT BY 12 JANUARY 2014
COALspot.com - Indonesian government is in the process of drafting an amendment for government regulation 23/ 2010.
GR 23/2010 has issued to sup ...
Wednesday, 06 July 11
ATLAS RESOURCES TO OFFLOAD 17 PERCENT IPO - INSIDER STORIES
Coking and thermal coal miner PT Atlas Energi Resources aims to offload 17percent new shares of its enlarged capital after Eid-Fitri holidays, as qu ...
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- Indonesian Coal Mining Association
- Sakthi Sugars Limited - India
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Gujarat Mineral Development Corp Ltd - India
- Thai Mozambique Logistica
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Agrawal Coal Company - India
- Wood Mackenzie - Singapore
- Kaltim Prima Coal - Indonesia
- LBH Netherlands Bv - Netherlands
- Siam City Cement PLC, Thailand
- Gujarat Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Grasim Industreis Ltd - India
- Baramulti Group, Indonesia
- New Zealand Coal & Carbon
- Bhatia International Limited - India
- Merrill Lynch Commodities Europe
- Medco Energi Mining Internasional
- Essar Steel Hazira Ltd - India
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Billiton Holdings Pty Ltd - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Wilmar Investment Holdings
- Bhushan Steel Limited - India
- Aboitiz Power Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Global Business Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Electricity Generating Authority of Thailand
- Jindal Steel & Power Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Salva Resources Pvt Ltd - India
- Sojitz Corporation - Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Electricity Authority, New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Therma Luzon, Inc, Philippines
- Bulk Trading Sa - Switzerland
- Global Coal Blending Company Limited - Australia
- AsiaOL BioFuels Corp., Philippines
- Ceylon Electricity Board - Sri Lanka
- Bangladesh Power Developement Board
- Energy Development Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- Kartika Selabumi Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Maheswari Brothers Coal Limited - India
- India Bulls Power Limited - India
- Central Java Power - Indonesia
- Price Waterhouse Coopers - Russia
- Globalindo Alam Lestari - Indonesia
- Port Waratah Coal Services - Australia
- Carbofer General Trading SA - India
- Vizag Seaport Private Limited - India
- OPG Power Generation Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Parry Sugars Refinery, India
- Videocon Industries ltd - India
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Savvy Resources Ltd - HongKong
- Bahari Cakrawala Sebuku - Indonesia
- The Treasury - Australian Government
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Oldendorff Carriers - Singapore
- Marubeni Corporation - India
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- CNBM International Corporation - China
- Power Finance Corporation Ltd., India
- Minerals Council of Australia
- Ambuja Cements Ltd - India
- Georgia Ports Authority, United States
- Barasentosa Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Standard Chartered Bank - UAE
- CIMB Investment Bank - Malaysia
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Indian Energy Exchange, India
- Bhoruka Overseas - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- GMR Energy Limited - India
- Heidelberg Cement - Germany
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Attock Cement Pakistan Limited
- Kalimantan Lumbung Energi - Indonesia
- Indogreen Group - Indonesia
- SMC Global Power, Philippines
- Bayan Resources Tbk. - Indonesia
- Makarim & Taira - Indonesia
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- Edison Trading Spa - Italy
- PTC India Limited - India
- South Luzon Thermal Energy Corporation
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Rashtriya Ispat Nigam Limited - India
- Timah Investasi Mineral - Indoneisa
- The State Trading Corporation of India Ltd
- Deloitte Consulting - India
- Economic Council, Georgia
- MS Steel International - UAE
- Madhucon Powers Ltd - India
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Interocean Group of Companies - India
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- Indika Energy - Indonesia
- Leighton Contractors Pty Ltd - Australia
- San Jose City I Power Corp, Philippines
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- Aditya Birla Group - India
- Semirara Mining Corp, Philippines
- Riau Bara Harum - Indonesia
- Mercuria Energy - Indonesia
- Coal and Oil Company - UAE
- European Bulk Services B.V. - Netherlands
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- Kumho Petrochemical, South Korea
- ICICI Bank Limited - India
- Kobexindo Tractors - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Sical Logistics Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Intertek Mineral Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- IEA Clean Coal Centre - UK
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karaikal Port Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Kideco Jaya Agung - Indonesia
- Kapuas Tunggal Persada - Indonesia
- The University of Queensland
- Mercator Lines Limited - India
- Ind-Barath Power Infra Limited - India
- Indian Oil Corporation Limited
- Coastal Gujarat Power Limited - India
- Ministry of Transport, Egypt
- Goldman Sachs - Singapore
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- Parliament of New Zealand
- Dalmia Cement Bharat India
- Romanian Commodities Exchange
- PowerSource Philippines DevCo
- Rio Tinto Coal - Australia
- SMG Consultants - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Trasteel International SA, Italy
- Krishnapatnam Port Company Ltd. - India
- Sarangani Energy Corporation, Philippines
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- Gujarat Sidhee Cement - India
- Directorate Of Revenue Intelligence - India
- Central Electricity Authority - India
- Renaissance Capital - South Africa
- Xindia Steels Limited - India
- Meralco Power Generation, Philippines
- Siam City Cement - Thailand
- Coalindo Energy - Indonesia
- Mintek Dendrill Indonesia
- Anglo American - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Malabar Cements Ltd - India
- Formosa Plastics Group - Taiwan
- Larsen & Toubro Limited - India
- Banpu Public Company Limited - Thailand
- Ministry of Finance - Indonesia
- Pendopo Energi Batubara - Indonesia
- Chamber of Mines of South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Energy - Thailand
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Petron Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Alfred C Toepfer International GmbH - Germany
- Jorong Barutama Greston.PT - Indonesia
- Energy Link Ltd, New Zealand
- Australian Commodity Traders Exchange
- GAC Shipping (India) Pvt Ltd
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