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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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Friday, 06 April 12
DRY BULK MARKET SWIFT TO HALT FALL ON RENEWED DEMAND FOR CAPESIZES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk managed to put a stop to the recent falls, which came as a result of a lacklustre demand for smaller vessel sizes. Although this trend ...
Thursday, 05 April 12
COAL EXPORT TAX: MATTER OF CONCERN FOR INDIA - SUNIL K KUMBHAT
COALspot.com - Since the issuance of Indonesian Mining law in 2009, miners have increased their activities in exploring , ex ...
Thursday, 05 April 12
AKR COAL FIRST EXPORT SHIPMENT OF COAL SEABORNE
PT Anugrah Karya Raya (AKR Coal) subsidiary of PT AKR Corporindo Tbk., Indonesia’s leading integrated supply chain solutions provider and larg ...
Thursday, 05 April 12
DRY BULK MARKET STALLS AS TREND IS REVERSED - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has halted its month-long rally, with the BDI (Baltic Dry Index) retreating yesterday for a second consecutive session. Industry ...
Wednesday, 04 April 12
OIL MAY JUMP TO $150PB IF IRAN ATTACKED: EXPERT - KUNA / HELLENIC SHIPPING
Prices of oil will not drop below level of $100 per barrel and may jump to $150 pb in the coming two months, according to the prominent Kuwaiti expe ...
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- Karaikal Port Pvt Ltd - India
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Simpson Spence & Young - Indonesia
- IEA Clean Coal Centre - UK
- Uttam Galva Steels Limited - India
- ICICI Bank Limited - India
- Power Finance Corporation Ltd., India
- Sojitz Corporation - Japan
- Straits Asia Resources Limited - Singapore
- Australian Commodity Traders Exchange
- LBH Netherlands Bv - Netherlands
- Gujarat Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- PowerSource Philippines DevCo
- GAC Shipping (India) Pvt Ltd
- Orica Australia Pty. Ltd.
- Chamber of Mines of South Africa
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- Metalloyd Limited - United Kingdom
- White Energy Company Limited
- Vijayanagar Sugar Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Siam City Cement PLC, Thailand
- Madhucon Powers Ltd - India
- Dalmia Cement Bharat India
- Indian Oil Corporation Limited
- Petrochimia International Co. Ltd.- Taiwan
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Mines - Canada
- Directorate General of MIneral and Coal - Indonesia
- Mercator Lines Limited - India
- Commonwealth Bank - Australia
- Kobexindo Tractors - Indoneisa
- Videocon Industries ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Wilmar Investment Holdings
- Samtan Co., Ltd - South Korea
- South Luzon Thermal Energy Corporation
- Jaiprakash Power Ventures ltd
- Parliament of New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Tamil Nadu electricity Board
- OPG Power Generation Pvt Ltd - India
- Agrawal Coal Company - India
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Bhushan Steel Limited - India
- Coastal Gujarat Power Limited - India
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- Banpu Public Company Limited - Thailand
- Ambuja Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- Jindal Steel & Power Ltd - India
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- Krishnapatnam Port Company Ltd. - India
- Meenaskhi Energy Private Limited - India
- Trasteel International SA, Italy
- Australian Coal Association
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Gujarat Sidhee Cement - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Merrill Lynch Commodities Europe
- IHS Mccloskey Coal Group - USA
- Thai Mozambique Logistica
- Larsen & Toubro Limited - India
- The Treasury - Australian Government
- New Zealand Coal & Carbon
- The University of Queensland
- Maharashtra Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Bulk Trading Sa - Switzerland
- Essar Steel Hazira Ltd - India
- Economic Council, Georgia
- Price Waterhouse Coopers - Russia
- Leighton Contractors Pty Ltd - Australia
- Indika Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- San Jose City I Power Corp, Philippines
- Toyota Tsusho Corporation, Japan
- Manunggal Multi Energi - Indonesia
- India Bulls Power Limited - India
- SMC Global Power, Philippines
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Orica Mining Services - Indonesia
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- Energy Link Ltd, New Zealand
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Makarim & Taira - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Independent Power Producers Association of India
- Lanco Infratech Ltd - India
- Bukit Makmur.PT - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Indogreen Group - Indonesia
- Mjunction Services Limited - India
- Kideco Jaya Agung - Indonesia
- Bharathi Cement Corporation - India
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- Electricity Authority, New Zealand
- Latin American Coal - Colombia
- Carbofer General Trading SA - India
- Grasim Industreis Ltd - India
- Renaissance Capital - South Africa
- Salva Resources Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Singapore Mercantile Exchange
- Kohat Cement Company Ltd. - Pakistan
- London Commodity Brokers - England
- Sree Jayajothi Cements Limited - India
- Bayan Resources Tbk. - Indonesia
- Oldendorff Carriers - Singapore
- Siam City Cement - Thailand
- Mintek Dendrill Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bhoruka Overseas - Indonesia
- Iligan Light & Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Bhatia International Limited - India
- Kaltim Prima Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Vedanta Resources Plc - India
- Star Paper Mills Limited - India
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Goldman Sachs - Singapore
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CNBM International Corporation - China
- Altura Mining Limited, Indonesia
- Heidelberg Cement - Germany
- Directorate Of Revenue Intelligence - India
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Sakthi Sugars Limited - India
- Minerals Council of Australia
- Vizag Seaport Private Limited - India
- Indian Energy Exchange, India
- Rashtriya Ispat Nigam Limited - India
- CIMB Investment Bank - Malaysia
- Aditya Birla Group - India
- Standard Chartered Bank - UAE
- Globalindo Alam Lestari - Indonesia
- Georgia Ports Authority, United States
- Semirara Mining Corp, Philippines
- Sical Logistics Limited - India
- Ceylon Electricity Board - Sri Lanka
- Global Business Power Corporation, Philippines
- Malabar Cements Ltd - India
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- Xindia Steels Limited - India
- Attock Cement Pakistan Limited
- Gujarat Mineral Development Corp Ltd - India
- Petron Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- TeaM Sual Corporation - Philippines
- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- SMG Consultants - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Energy - Thailand
- VISA Power Limited - India
- Sarangani Energy Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Formosa Plastics Group - Taiwan
- Coalindo Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Generating Authority of Thailand
- Ministry of Finance - Indonesia
- Borneo Indobara - Indonesia
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- Edison Trading Spa - Italy
- Ministry of Transport, Egypt
- GMR Energy Limited - India
- Marubeni Corporation - India
- Holcim Trading Pte Ltd - Singapore
- Tata Chemicals Ltd - India
- Central Electricity Authority - India
- Indonesian Coal Mining Association
- Mercuria Energy - Indonesia
- Bangladesh Power Developement Board
- Cement Manufacturers Association - India
- Pipit Mutiara Jaya. PT, Indonesia
- MS Steel International - UAE
- Baramulti Group, Indonesia
- International Coal Ventures Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
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