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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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Thursday, 20 September 12
DRY BULK INCHES FORWARD AFTER WEEKS OF BELOW PAR PERFORMANCE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has started to revive from its ashed, as the past couple of days, traders have reported an increased activity from China, result ...
Wednesday, 19 September 12
CHURCHILL STRENGTHENS LITIGATION TEAM WITH APPOINTMENT OF NICHOLAS SMITH AS MANAGING DIRECTOR
COALspot.com - Churchill Mining PLC (AIM: CHL) has announced that, Mr Nicholas Smith has joined the board of the Company and has been appointed as t ...
Wednesday, 19 September 12
DRY BULK TERMINALS SINGAPORE
Press Release - Dry bulk terminals are used all around the world to handle large quantities of bulk materials, like minerals, grains, etc. In today& ...
Tuesday, 18 September 12
JORC CODE REVISION - EXPOSURE DRAFT RELEASED FOR COMMENT
COALspot.com - The Australasian Joint Ore Reserves Committee (JORC) has today released for public comment the exposure draft of the JORC Code (2012) ...
Monday, 17 September 12
YEAR TO DATE, BUMA PRODUCED 231.1 MILLION BCM OF OVERBURDEN
COALspot.com - PT. Delta Dunia Makmur Tbk has removed 31.5 million bcm (+6.0 percent YoY) overburden in August 2012 totaled 31.5 million bcm ( ...
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- Goldman Sachs - Singapore
- Merrill Lynch Commodities Europe
- Gujarat Mineral Development Corp Ltd - India
- Carbofer General Trading SA - India
- Georgia Ports Authority, United States
- PNOC Exploration Corporation - Philippines
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Billiton Holdings Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- Price Waterhouse Coopers - Russia
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Planning Commission, India
- Meralco Power Generation, Philippines
- Borneo Indobara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Uttam Galva Steels Limited - India
- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Antam Resourcindo - Indonesia
- Altura Mining Limited, Indonesia
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- Siam City Cement PLC, Thailand
- Savvy Resources Ltd - HongKong
- Pipit Mutiara Jaya. PT, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Salva Resources Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Bukit Baiduri Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Medco Energi Mining Internasional
- Metalloyd Limited - United Kingdom
- Ceylon Electricity Board - Sri Lanka
- Trasteel International SA, Italy
- Romanian Commodities Exchange
- Commonwealth Bank - Australia
- Baramulti Group, Indonesia
- Electricity Generating Authority of Thailand
- Bukit Makmur.PT - Indonesia
- Coal and Oil Company - UAE
- Global Coal Blending Company Limited - Australia
- Kaltim Prima Coal - Indonesia
- Anglo American - United Kingdom
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Ind-Barath Power Infra Limited - India
- Port Waratah Coal Services - Australia
- Directorate Of Revenue Intelligence - India
- Mintek Dendrill Indonesia
- Straits Asia Resources Limited - Singapore
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- New Zealand Coal & Carbon
- Aboitiz Power Corporation - Philippines
- Agrawal Coal Company - India
- Sarangani Energy Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kartika Selabumi Mining - Indonesia
- SMG Consultants - Indonesia
- Madhucon Powers Ltd - India
- Vizag Seaport Private Limited - India
- Latin American Coal - Colombia
- IEA Clean Coal Centre - UK
- SN Aboitiz Power Inc, Philippines
- CIMB Investment Bank - Malaysia
- Bulk Trading Sa - Switzerland
- Orica Australia Pty. Ltd.
- Central Electricity Authority - India
- MS Steel International - UAE
- Global Business Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Cement Manufacturers Association - India
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Neyveli Lignite Corporation Ltd, - India
- Chettinad Cement Corporation Ltd - India
- Wilmar Investment Holdings
- Indogreen Group - Indonesia
- Thiess Contractors Indonesia
- IHS Mccloskey Coal Group - USA
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- Chamber of Mines of South Africa
- Samtan Co., Ltd - South Korea
- PowerSource Philippines DevCo
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Transport, Egypt
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Parry Sugars Refinery, India
- Star Paper Mills Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Jindal Steel & Power Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Krishnapatnam Port Company Ltd. - India
- Gujarat Electricity Regulatory Commission - India
- Globalindo Alam Lestari - Indonesia
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- Energy Link Ltd, New Zealand
- Orica Mining Services - Indonesia
- ICICI Bank Limited - India
- Indonesian Coal Mining Association
- Bhushan Steel Limited - India
- CNBM International Corporation - China
- Rio Tinto Coal - Australia
- Simpson Spence & Young - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Videocon Industries ltd - India
- Ambuja Cements Ltd - India
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Xindia Steels Limited - India
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Australian Commodity Traders Exchange
- VISA Power Limited - India
- McConnell Dowell - Australia
- Manunggal Multi Energi - Indonesia
- Singapore Mercantile Exchange
- Iligan Light & Power Inc, Philippines
- Central Java Power - Indonesia
- Indian Energy Exchange, India
- AsiaOL BioFuels Corp., Philippines
- Interocean Group of Companies - India
- Gujarat Sidhee Cement - India
- South Luzon Thermal Energy Corporation
- Bangladesh Power Developement Board
- Bhatia International Limited - India
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Sojitz Corporation - Japan
- Essar Steel Hazira Ltd - India
- Standard Chartered Bank - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Alfred C Toepfer International GmbH - Germany
- Tamil Nadu electricity Board
- Karbindo Abesyapradhi - Indoneisa
- London Commodity Brokers - England
- Ministry of Mines - Canada
- Asmin Koalindo Tuhup - Indonesia
- Indika Energy - Indonesia
- Eastern Coal Council - USA
- Bahari Cakrawala Sebuku - Indonesia
- Wood Mackenzie - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMC Global Power, Philippines
- Attock Cement Pakistan Limited
- Vedanta Resources Plc - India
- Lanco Infratech Ltd - India
- Minerals Council of Australia
- Intertek Mineral Services - Indonesia
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- Karaikal Port Pvt Ltd - India
- Grasim Industreis Ltd - India
- Therma Luzon, Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- Eastern Energy - Thailand
- Renaissance Capital - South Africa
- Australian Coal Association
- GAC Shipping (India) Pvt Ltd
- Makarim & Taira - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bukit Asam (Persero) Tbk - Indonesia
- Tata Chemicals Ltd - India
- Oldendorff Carriers - Singapore
- Edison Trading Spa - Italy
- Electricity Authority, New Zealand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Toyota Tsusho Corporation, Japan
- Sical Logistics Limited - India
- Independent Power Producers Association of India
- Thai Mozambique Logistica
- Mercator Lines Limited - India
- Maheswari Brothers Coal Limited - India
- White Energy Company Limited
- Bhoruka Overseas - Indonesia
- The University of Queensland
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Africa Commodities Group - South Africa
- Economic Council, Georgia
- Mercuria Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Sakthi Sugars Limited - India
- ASAPP Information Group - India
- Jaiprakash Power Ventures ltd
- Banpu Public Company Limited - Thailand
- Dalmia Cement Bharat India
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Coastal Gujarat Power Limited - India
- OPG Power Generation Pvt Ltd - India
- Indian Oil Corporation Limited
- The Treasury - Australian Government
- Jorong Barutama Greston.PT - Indonesia
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