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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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Saturday, 13 November 10
INDONESIA SHIPPED 8.73 % MORE COAL IN OCTOBER THAN A MONTH EARLIER
COALspot.com: Indonesia, the world largest coal exporter, shipped 23.55 mln mt of coal in October 2010, which is 8.73 percent more compared to Septe ...
Friday, 12 November 10
BANPU'S NET PROFIT HAS INCREASED 249 PERCENT IN 3Q 2010 COMPARED TO THE SAME PERIOD LAST YEAR
COALspot.com: Banpu Public Company Limited (BANPU) reports its financial performance for the third quarter 2010, posting a net profit of THB 13,293 ...
Friday, 12 November 10
DRY BULK MARKET STILL ON A FREEFALL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market failed to show any signs of life this week, with the Baltic Dry Index (BDI) still being on the red, now stretching more than 11 ...
Thursday, 11 November 10
KOMIPO WANTS 400KT OF SUB BITUMINOUS COAL
COALspot.com : Korea Midland Power Co. Ltd. (KOMIPO) is looking for 400,000 MT of sub bituminous coal through International open bidding. The delive ...
Wednesday, 10 November 10
NTPC TO IMPORT 12 MILLION TONS OF COAL IN 2011
COALspot.com: India's State Trading Corp Ltd a public sector Govt of India co. is looking for 12 million tones (+/- 2%) of imported coal for NTPC. ...
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- San Jose City I Power Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Gujarat Mineral Development Corp Ltd - India
- Grasim Industreis Ltd - India
- Goldman Sachs - Singapore
- Kideco Jaya Agung - Indonesia
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Indika Energy - Indonesia
- London Commodity Brokers - England
- Billiton Holdings Pty Ltd - Australia
- Power Finance Corporation Ltd., India
- TNB Fuel Sdn Bhd - Malaysia
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Port Waratah Coal Services - Australia
- CIMB Investment Bank - Malaysia
- Borneo Indobara - Indonesia
- Indogreen Group - Indonesia
- Lanco Infratech Ltd - India
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Meenaskhi Energy Private Limited - India
- Cement Manufacturers Association - India
- Xindia Steels Limited - India
- Malabar Cements Ltd - India
- Africa Commodities Group - South Africa
- Tamil Nadu electricity Board
- Indian Energy Exchange, India
- Semirara Mining and Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ASAPP Information Group - India
- IEA Clean Coal Centre - UK
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- Electricity Authority, New Zealand
- Global Green Power PLC Corporation, Philippines
- Thiess Contractors Indonesia
- Manunggal Multi Energi - Indonesia
- The University of Queensland
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Vizag Seaport Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Baramulti Group, Indonesia
- GVK Power & Infra Limited - India
- Makarim & Taira - Indonesia
- SN Aboitiz Power Inc, Philippines
- New Zealand Coal & Carbon
- Altura Mining Limited, Indonesia
- Jaiprakash Power Ventures ltd
- Mercator Lines Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Australian Coal Association
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thai Mozambique Logistica
- Chettinad Cement Corporation Ltd - India
- Latin American Coal - Colombia
- Uttam Galva Steels Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- IHS Mccloskey Coal Group - USA
- Directorate Of Revenue Intelligence - India
- Ministry of Transport, Egypt
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Asmin Koalindo Tuhup - Indonesia
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Metalloyd Limited - United Kingdom
- Independent Power Producers Association of India
- GMR Energy Limited - India
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- Anglo American - United Kingdom
- Sree Jayajothi Cements Limited - India
- Bukit Baiduri Energy - Indonesia
- Electricity Generating Authority of Thailand
- Kapuas Tunggal Persada - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Sarangani Energy Corporation, Philippines
- Commonwealth Bank - Australia
- Romanian Commodities Exchange
- Indo Tambangraya Megah - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bulk Trading Sa - Switzerland
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Meralco Power Generation, Philippines
- Heidelberg Cement - Germany
- Siam City Cement PLC, Thailand
- Renaissance Capital - South Africa
- Ministry of Mines - Canada
- Formosa Plastics Group - Taiwan
- Parry Sugars Refinery, India
- Energy Development Corp, Philippines
- Mintek Dendrill Indonesia
- Chamber of Mines of South Africa
- Australian Commodity Traders Exchange
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Parliament of New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Oldendorff Carriers - Singapore
- Mercuria Energy - Indonesia
- Standard Chartered Bank - UAE
- Madhucon Powers Ltd - India
- Kumho Petrochemical, South Korea
- Ministry of Finance - Indonesia
- Orica Mining Services - Indonesia
- Kartika Selabumi Mining - Indonesia
- Jindal Steel & Power Ltd - India
- ICICI Bank Limited - India
- Bhatia International Limited - India
- Sindya Power Generating Company Private Ltd
- Bharathi Cement Corporation - India
- Orica Australia Pty. Ltd.
- Jorong Barutama Greston.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Eastern Energy - Thailand
- Sojitz Corporation - Japan
- European Bulk Services B.V. - Netherlands
- GAC Shipping (India) Pvt Ltd
- Alfred C Toepfer International GmbH - Germany
- PTC India Limited - India
- SMC Global Power, Philippines
- Ceylon Electricity Board - Sri Lanka
- Asia Pacific Energy Resources Ventures Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Videocon Industries ltd - India
- Bhushan Steel Limited - India
- Indonesian Coal Mining Association
- Antam Resourcindo - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- Merrill Lynch Commodities Europe
- Barasentosa Lestari - Indonesia
- Singapore Mercantile Exchange
- Simpson Spence & Young - Indonesia
- The State Trading Corporation of India Ltd
- MS Steel International - UAE
- Maheswari Brothers Coal Limited - India
- Edison Trading Spa - Italy
- McConnell Dowell - Australia
- SMG Consultants - Indonesia
- Economic Council, Georgia
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- Mjunction Services Limited - India
- Samtan Co., Ltd - South Korea
- Coal and Oil Company - UAE
- White Energy Company Limited
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Wilmar Investment Holdings
- India Bulls Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Aditya Birla Group - India
- Larsen & Toubro Limited - India
- VISA Power Limited - India
- The Treasury - Australian Government
- Central Electricity Authority - India
- Intertek Mineral Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Salva Resources Pvt Ltd - India
- Trasteel International SA, Italy
- Interocean Group of Companies - India
- Coalindo Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Star Paper Mills Limited - India
- Kobexindo Tractors - Indoneisa
- Karaikal Port Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Marubeni Corporation - India
- Central Java Power - Indonesia
- Riau Bara Harum - Indonesia
- Straits Asia Resources Limited - Singapore
- Kepco SPC Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Bukit Makmur.PT - Indonesia
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Sical Logistics Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Medco Energi Mining Internasional
- Gujarat Electricity Regulatory Commission - India
- Wood Mackenzie - Singapore
- Sakthi Sugars Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- Carbofer General Trading SA - India
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