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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, 25 September 10
INDONESIA HAS EXPORTED 187.656 MILLION TONNES OF COAL IN EIGHT MONTHS
COALspot.com: Indonesia, the world largest coal exporter has exported 187.656 million tons of coal for the period January – August this ...
Saturday, 25 September 10
PRESSURE ON S6 AND S7 ROUTES SEEMS TO BE CONTINUED NEXT WEEK CAPT. REDDY
COALspot.com: The freight market has been flat this week due to holidays in China and low activity saw all sectors down and soft.
The BDI was dow ...
Thursday, 23 September 10
CHURCHILL MINING SHARES JUMP ON EAST KUTAI COAL PROJECT FEASIBILITY RESULTS - STOCKOPEDIA
AIM listed mining group Churchill Mining (LON:CHL) and its Indonesian partners the Ridlatama Group, have completed a feasibility study on the 2.73bn ...
Thursday, 23 September 10
DRY BULK RATES EXPECTEDLY FALL TO ONE MONTH LOWS - HELLENIC SHIPPING
With of the Far East trade routes closed this week on various national holidays, demand for ocean transportation of raw materials has been significa ...
Wednesday, 22 September 10
INDIA TO BE BIGGEST BUYER OF INDONESIAN COAL BY 2011 - BUSINESS STANDARD
India will pass Japan to be the biggest buyer of Indonesian coal by 2011, said Bob Kamandanu, chairman of the Indonesian Coal Mining Association.
...
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- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- The Treasury - Australian Government
- Directorate Of Revenue Intelligence - India
- Ministry of Transport, Egypt
- Malabar Cements Ltd - India
- Gujarat Sidhee Cement - India
- Sinarmas Energy and Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- CNBM International Corporation - China
- Bhushan Steel Limited - India
- Orica Mining Services - Indonesia
- McConnell Dowell - Australia
- Jorong Barutama Greston.PT - Indonesia
- SMC Global Power, Philippines
- Madhucon Powers Ltd - India
- European Bulk Services B.V. - Netherlands
- San Jose City I Power Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Latin American Coal - Colombia
- The State Trading Corporation of India Ltd
- Bharathi Cement Corporation - India
- Toyota Tsusho Corporation, Japan
- PetroVietnam Power Coal Import and Supply Company
- PNOC Exploration Corporation - Philippines
- Thai Mozambique Logistica
- TNB Fuel Sdn Bhd - Malaysia
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- GVK Power & Infra Limited - India
- The University of Queensland
- Meralco Power Generation, Philippines
- Power Finance Corporation Ltd., India
- Bhatia International Limited - India
- Samtan Co., Ltd - South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- International Coal Ventures Pvt Ltd - India
- Sojitz Corporation - Japan
- Xindia Steels Limited - India
- Bukit Baiduri Energy - Indonesia
- Independent Power Producers Association of India
- Straits Asia Resources Limited - Singapore
- Carbofer General Trading SA - India
- Planning Commission, India
- Singapore Mercantile Exchange
- Riau Bara Harum - Indonesia
- Mintek Dendrill Indonesia
- Holcim Trading Pte Ltd - Singapore
- Siam City Cement - Thailand
- Commonwealth Bank - Australia
- Interocean Group of Companies - India
- Maharashtra Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Kepco SPC Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Agrawal Coal Company - India
- Maheswari Brothers Coal Limited - India
- Energy Link Ltd, New Zealand
- GAC Shipping (India) Pvt Ltd
- PTC India Limited - India
- Ministry of Mines - Canada
- Parliament of New Zealand
- Merrill Lynch Commodities Europe
- Gujarat Electricity Regulatory Commission - India
- Indika Energy - Indonesia
- Mercuria Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- Grasim Industreis Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- GMR Energy Limited - India
- Georgia Ports Authority, United States
- Thiess Contractors Indonesia
- India Bulls Power Limited - India
- Orica Australia Pty. Ltd.
- Trasteel International SA, Italy
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Economic Council, Georgia
- Heidelberg Cement - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Wilmar Investment Holdings
- Global Coal Blending Company Limited - Australia
- Karaikal Port Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Aditya Birla Group - India
- Salva Resources Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Baramulti Group, Indonesia
- Rashtriya Ispat Nigam Limited - India
- Goldman Sachs - Singapore
- Savvy Resources Ltd - HongKong
- Electricity Authority, New Zealand
- Tata Chemicals Ltd - India
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- Price Waterhouse Coopers - Russia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- Bangladesh Power Developement Board
- Kohat Cement Company Ltd. - Pakistan
- Kalimantan Lumbung Energi - Indonesia
- Kideco Jaya Agung - Indonesia
- Posco Energy - South Korea
- IHS Mccloskey Coal Group - USA
- Indian Oil Corporation Limited
- GN Power Mariveles Coal Plant, Philippines
- MS Steel International - UAE
- Kumho Petrochemical, South Korea
- Binh Thuan Hamico - Vietnam
- Standard Chartered Bank - UAE
- Ministry of Finance - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Edison Trading Spa - Italy
- Offshore Bulk Terminal Pte Ltd, Singapore
- VISA Power Limited - India
- SN Aboitiz Power Inc, Philippines
- Sical Logistics Limited - India
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- Semirara Mining and Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Australian Commodity Traders Exchange
- Pendopo Energi Batubara - Indonesia
- Siam City Cement PLC, Thailand
- Chettinad Cement Corporation Ltd - India
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- White Energy Company Limited
- Eastern Energy - Thailand
- IEA Clean Coal Centre - UK
- Timah Investasi Mineral - Indoneisa
- South Luzon Thermal Energy Corporation
- Intertek Mineral Services - Indonesia
- ASAPP Information Group - India
- Indo Tambangraya Megah - Indonesia
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- Anglo American - United Kingdom
- Larsen & Toubro Limited - India
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- Altura Mining Limited, Indonesia
- Global Green Power PLC Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Renaissance Capital - South Africa
- New Zealand Coal & Carbon
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Essar Steel Hazira Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Iligan Light & Power Inc, Philippines
- Central Java Power - Indonesia
- Wood Mackenzie - Singapore
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Sindya Power Generating Company Private Ltd
- Mercator Lines Limited - India
- Coal and Oil Company - UAE
- AsiaOL BioFuels Corp., Philippines
- Banpu Public Company Limited - Thailand
- Electricity Generating Authority of Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- OPG Power Generation Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Vizag Seaport Private Limited - India
- Minerals Council of Australia
- Globalindo Alam Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Indogreen Group - Indonesia
- Sarangani Energy Corporation, Philippines
- CIMB Investment Bank - Malaysia
- PowerSource Philippines DevCo
- Cement Manufacturers Association - India
- Eastern Coal Council - USA
- Medco Energi Mining Internasional
- Krishnapatnam Port Company Ltd. - India
- Tamil Nadu electricity Board
- Kartika Selabumi Mining - Indonesia
- Bayan Resources Tbk. - Indonesia
- Africa Commodities Group - South Africa
- Indian Energy Exchange, India
- Bahari Cakrawala Sebuku - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- Jindal Steel & Power Ltd - India
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- Asmin Koalindo Tuhup - Indonesia
- Lanco Infratech Ltd - India
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- Marubeni Corporation - India
- Billiton Holdings Pty Ltd - Australia
- Mjunction Services Limited - India
- Therma Luzon, Inc, Philippines
- Ind-Barath Power Infra Limited - India
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