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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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Monday, 11 October 10
INDONESIAN POWER PLANTS AND OTHER INDUSTRIES TO BURN 78.97 MLN TONS OF COAL IN 2011
COALspot.com: The Minister of Energy and Mineral Resources of Indonesia has issued a ministerial degree 2360 K/30/MEM/ 2010 related to Domestic mark ...
Monday, 11 October 10
COAL IMPORTS TO START IN 2015 - VIETNAM BUSINESS
Vietnam Business reported that, Viet Nam is now likely to import coal only from 2015, not 2013 as earlier forecast since many thermal power pl ...
Monday, 11 October 10
OCTOBER INDONESIAN COAL PRICE REFERENCE UP BY 2.92 PERCENT
COALspot.com: The Directorate General of Mineral, Coal and Geothermal of Indonesia has been publishing a monthly coal price reference (HBA) since Fe ...
Saturday, 09 October 10
MPPGCL SEEKS TO BUY 0.40 MLN MT OF COAL FOR ITS THERMAL POWER STATIONS
COALspot.com: India's Madhya Pradesh Generating Company Limited (MPPGCL), Jabalpur, Madhya Pradesh invites bidders through tender 07-03/Import/Coal ...
Saturday, 09 October 10
FREIGHT MARKET IS EXPECTED TO FIRM UP NEXT WEEK CAPT REDDY
COALspot.com: Inspite of Chinese holidays the BDI was up by 10 pct and closed at 2,696 points. The cape index shot up to 20 pct and closed at 4,076 ...
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- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Sakthi Sugars Limited - India
- Simpson Spence & Young - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- London Commodity Brokers - England
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Toyota Tsusho Corporation, Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- VISA Power Limited - India
- Wood Mackenzie - Singapore
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Electricity Generating Authority of Thailand
- Global Business Power Corporation, Philippines
- India Bulls Power Limited - India
- GVK Power & Infra Limited - India
- Meenaskhi Energy Private Limited - India
- Kideco Jaya Agung - Indonesia
- Ministry of Transport, Egypt
- Africa Commodities Group - South Africa
- Videocon Industries ltd - India
- Central Java Power - Indonesia
- Straits Asia Resources Limited - Singapore
- Indo Tambangraya Megah - Indonesia
- Lanco Infratech Ltd - India
- Energy Link Ltd, New Zealand
- Maheswari Brothers Coal Limited - India
- Antam Resourcindo - Indonesia
- Larsen & Toubro Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Directorate Of Revenue Intelligence - India
- Neyveli Lignite Corporation Ltd, - India
- Gujarat Sidhee Cement - India
- Eastern Coal Council - USA
- Commonwealth Bank - Australia
- Orica Mining Services - Indonesia
- Thiess Contractors Indonesia
- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Alfred C Toepfer International GmbH - Germany
- Agrawal Coal Company - India
- Makarim & Taira - Indonesia
- Eastern Energy - Thailand
- Semirara Mining and Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- Intertek Mineral Services - Indonesia
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- Electricity Authority, New Zealand
- Bukit Baiduri Energy - Indonesia
- Indonesian Coal Mining Association
- Parry Sugars Refinery, India
- Planning Commission, India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Bhoruka Overseas - Indonesia
- IEA Clean Coal Centre - UK
- Semirara Mining Corp, Philippines
- Mercuria Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Bulk Trading Sa - Switzerland
- Bukit Asam (Persero) Tbk - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- New Zealand Coal & Carbon
- Mjunction Services Limited - India
- Orica Australia Pty. Ltd.
- Georgia Ports Authority, United States
- LBH Netherlands Bv - Netherlands
- Banpu Public Company Limited - Thailand
- Karaikal Port Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- OPG Power Generation Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- PTC India Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Barasentosa Lestari - Indonesia
- Attock Cement Pakistan Limited
- Interocean Group of Companies - India
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- ASAPP Information Group - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- SMC Global Power, Philippines
- Merrill Lynch Commodities Europe
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Singapore Mercantile Exchange
- Formosa Plastics Group - Taiwan
- Posco Energy - South Korea
- Aboitiz Power Corporation - Philippines
- Grasim Industreis Ltd - India
- Australian Commodity Traders Exchange
- Globalindo Alam Lestari - Indonesia
- MS Steel International - UAE
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
- Heidelberg Cement - Germany
- Sindya Power Generating Company Private Ltd
- Kapuas Tunggal Persada - Indonesia
- Parliament of New Zealand
- Oldendorff Carriers - Singapore
- Vedanta Resources Plc - India
- Gujarat Mineral Development Corp Ltd - India
- Rashtriya Ispat Nigam Limited - India
- IHS Mccloskey Coal Group - USA
- Ind-Barath Power Infra Limited - India
- Deloitte Consulting - India
- Asmin Koalindo Tuhup - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Trasteel International SA, Italy
- Madhucon Powers Ltd - India
- Marubeni Corporation - India
- Meralco Power Generation, Philippines
- Ministry of Mines - Canada
- Sojitz Corporation - Japan
- Bhushan Steel Limited - India
- Sarangani Energy Corporation, Philippines
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Sical Logistics Limited - India
- CIMB Investment Bank - Malaysia
- Edison Trading Spa - Italy
- Kumho Petrochemical, South Korea
- Altura Mining Limited, Indonesia
- Coal and Oil Company - UAE
- Manunggal Multi Energi - Indonesia
- Economic Council, Georgia
- Tamil Nadu electricity Board
- Sinarmas Energy and Mining - Indonesia
- Ministry of Finance - Indonesia
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Mercator Lines Limited - India
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- McConnell Dowell - Australia
- Jorong Barutama Greston.PT - Indonesia
- Malabar Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- GN Power Mariveles Coal Plant, Philippines
- Iligan Light & Power Inc, Philippines
- Kaltim Prima Coal - Indonesia
- European Bulk Services B.V. - Netherlands
- Bangladesh Power Developement Board
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Coal Blending Company Limited - Australia
- Coastal Gujarat Power Limited - India
- Ambuja Cements Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- ICICI Bank Limited - India
- Carbofer General Trading SA - India
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Thai Mozambique Logistica
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kepco SPC Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Power Finance Corporation Ltd., India
- SN Aboitiz Power Inc, Philippines
- Romanian Commodities Exchange
- Minerals Council of Australia
- Central Electricity Authority - India
- Salva Resources Pvt Ltd - India
- Mintek Dendrill Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Xindia Steels Limited - India
- Energy Development Corp, Philippines
- The Treasury - Australian Government
- Kartika Selabumi Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Timah Investasi Mineral - Indoneisa
- Australian Coal Association
- Global Green Power PLC Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Bhatia International Limited - India
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Indian Energy Exchange, India
- Bayan Resources Tbk. - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Vizag Seaport Private Limited - India
- Standard Chartered Bank - UAE
- Essar Steel Hazira Ltd - India
- Latin American Coal - Colombia
- Goldman Sachs - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Samtan Co., Ltd - South Korea
- Cement Manufacturers Association - India
- Borneo Indobara - Indonesia
- TeaM Sual Corporation - Philippines
- Siam City Cement - Thailand
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