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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, 28 July 12
CAL 2013 COAL SWAPS ARE HIGHER COMPARED TO SEPT 2012 PRICES
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for September 2012 delivery gain 0.47 percent on Friday (27 July 2012) closing DoD but lost 0.90 ...
Friday, 27 July 12
PACIFIC MARKET REMAINED FLAT - FEARNLEYS AS
Handy
The Atlantic market continued its downward trend from last week with what appears to be a summer lull across the board. A trip from the USG t ...
Wednesday, 25 July 12
BUKIT ASAMS H1 REVENUE JUMPED BY 13 PERCENT
COALspot.com - PT Bukit Asam (Persero), Tbk., the state owned coal miner's revenue in H1 2012, has jumped 13 percent to IDR 5.79 trillion (approxim ...
Wednesday, 25 July 12
BUMI RESOURCES MINERALS SECURED PINJAM PAKAI FOR ITS ZINC AND LEAD PROJECT
COALspot.com - PT Bumi Resources Minerals Tbk. ("BRMS" or "the Company") today reported that its 80% owned subsidiary, PT Dairi ...
Tuesday, 24 July 12
SHIP OWNERS WAITING FOR SHIP PRICES TO FALL FURTHER BEFORE MOVING IN MORE AGGRESSIVELY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the summer season already well under way and many ship owners getting ready for the autumn, the sale & purchasing activity of second hand v ...
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- Electricity Generating Authority of Thailand
- Altura Mining Limited, Indonesia
- CIMB Investment Bank - Malaysia
- Economic Council, Georgia
- Indian Energy Exchange, India
- Deloitte Consulting - India
- Siam City Cement - Thailand
- Indonesian Coal Mining Association
- Kepco SPC Power Corporation, Philippines
- Thiess Contractors Indonesia
- Madhucon Powers Ltd - India
- White Energy Company Limited
- Antam Resourcindo - Indonesia
- Ministry of Mines - Canada
- Indika Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Rashtriya Ispat Nigam Limited - India
- New Zealand Coal & Carbon
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bulk Trading Sa - Switzerland
- MS Steel International - UAE
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sical Logistics Limited - India
- Medco Energi Mining Internasional
- Coal and Oil Company - UAE
- Sindya Power Generating Company Private Ltd
- Central Electricity Authority - India
- Parry Sugars Refinery, India
- International Coal Ventures Pvt Ltd - India
- VISA Power Limited - India
- Interocean Group of Companies - India
- Renaissance Capital - South Africa
- Orica Australia Pty. Ltd.
- IEA Clean Coal Centre - UK
- Petron Corporation, Philippines
- Merrill Lynch Commodities Europe
- Wilmar Investment Holdings
- Semirara Mining and Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Holcim Trading Pte Ltd - Singapore
- Kobexindo Tractors - Indoneisa
- Malabar Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Edison Trading Spa - Italy
- Therma Luzon, Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- CNBM International Corporation - China
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bangladesh Power Developement Board
- Cement Manufacturers Association - India
- SN Aboitiz Power Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Coal Blending Company Limited - Australia
- Manunggal Multi Energi - Indonesia
- Indian Oil Corporation Limited
- Karaikal Port Pvt Ltd - India
- Grasim Industreis Ltd - India
- Singapore Mercantile Exchange
- Larsen & Toubro Limited - India
- Goldman Sachs - Singapore
- Pendopo Energi Batubara - Indonesia
- Jindal Steel & Power Ltd - India
- IHS Mccloskey Coal Group - USA
- Formosa Plastics Group - Taiwan
- Toyota Tsusho Corporation, Japan
- Port Waratah Coal Services - Australia
- Borneo Indobara - Indonesia
- Bukit Baiduri Energy - Indonesia
- SMC Global Power, Philippines
- Xindia Steels Limited - India
- McConnell Dowell - Australia
- Simpson Spence & Young - Indonesia
- TeaM Sual Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- LBH Netherlands Bv - Netherlands
- Eastern Energy - Thailand
- Oldendorff Carriers - Singapore
- Ministry of Transport, Egypt
- Videocon Industries ltd - India
- Anglo American - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- Bhushan Steel Limited - India
- Baramulti Group, Indonesia
- Riau Bara Harum - Indonesia
- Carbofer General Trading SA - India
- Posco Energy - South Korea
- Agrawal Coal Company - India
- ICICI Bank Limited - India
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Parliament of New Zealand
- Attock Cement Pakistan Limited
- Metalloyd Limited - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- GAC Shipping (India) Pvt Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tamil Nadu electricity Board
- Mjunction Services Limited - India
- OPG Power Generation Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- Star Paper Mills Limited - India
- San Jose City I Power Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mintek Dendrill Indonesia
- Gujarat Mineral Development Corp Ltd - India
- SMG Consultants - Indonesia
- Central Java Power - Indonesia
- Australian Coal Association
- Vizag Seaport Private Limited - India
- The Treasury - Australian Government
- Bukit Asam (Persero) Tbk - Indonesia
- Rio Tinto Coal - Australia
- Standard Chartered Bank - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Minerals Council of Australia
- Meralco Power Generation, Philippines
- Eastern Coal Council - USA
- TNB Fuel Sdn Bhd - Malaysia
- Bhatia International Limited - India
- Kartika Selabumi Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- Essar Steel Hazira Ltd - India
- PTC India Limited - India
- Iligan Light & Power Inc, Philippines
- Makarim & Taira - Indonesia
- Independent Power Producers Association of India
- Vedanta Resources Plc - India
- Global Green Power PLC Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Indogreen Group - Indonesia
- Meenaskhi Energy Private Limited - India
- Billiton Holdings Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Energy Development Corp, Philippines
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Bayan Resources Tbk. - Indonesia
- Orica Mining Services - Indonesia
- Savvy Resources Ltd - HongKong
- Dalmia Cement Bharat India
- Aditya Birla Group - India
- Gujarat Sidhee Cement - India
- Bharathi Cement Corporation - India
- Chettinad Cement Corporation Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Africa Commodities Group - South Africa
- Siam City Cement PLC, Thailand
- Romanian Commodities Exchange
- Lanco Infratech Ltd - India
- Globalindo Alam Lestari - Indonesia
- PowerSource Philippines DevCo
- Price Waterhouse Coopers - Russia
- Latin American Coal - Colombia
- Planning Commission, India
- Asmin Koalindo Tuhup - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Mercuria Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- ASAPP Information Group - India
- Global Business Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- London Commodity Brokers - England
- Timah Investasi Mineral - Indoneisa
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- Trasteel International SA, Italy
- Aboitiz Power Corporation - Philippines
- GMR Energy Limited - India
- Ministry of Finance - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- Commonwealth Bank - Australia
- Cigading International Bulk Terminal - Indonesia
- The University of Queensland
- Georgia Ports Authority, United States
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Bhoruka Overseas - Indonesia
- Kapuas Tunggal Persada - Indonesia
- The State Trading Corporation of India Ltd
- Samtan Co., Ltd - South Korea
- Kideco Jaya Agung - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Intertek Mineral Services - Indonesia
- Power Finance Corporation Ltd., India
- Karbindo Abesyapradhi - Indoneisa
- GVK Power & Infra Limited - India
- Sarangani Energy Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- PNOC Exploration Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- Kalimantan Lumbung Energi - Indonesia
- Energy Link Ltd, New Zealand
- Chamber of Mines of South Africa
- Leighton Contractors Pty Ltd - Australia
- Thai Mozambique Logistica
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- Wood Mackenzie - Singapore
- Ambuja Cements Ltd - India
- Coalindo Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
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