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Thursday, 13 January 11
DRY BULK RATES HIT NEW MULTI-MONTH LOWS ON AUSTRALIAS FLOODS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 Floods in Australia’s Queensland has seriously disrupted coal shipments and together with a flood of vessels has pushed freight rates for dry bulk carriers to new multi-month lows. As a result, the Baltic Dry Index fell further yesterday to just 1,453 points, losing 1.82% on the day, while the suffering Capesize segment retreated by a further 4.77%.
The BDI has now recorded 21 straight losing sessions, losing almost 34% of its value. According to calculations from John Cotzias, head of N.Cotzias Shipping Group, in 58 sessions spanning at just less of three months, there have been only 10 days, during which the index was positive.
“The Cape index is counting 12 falling days and has overall lost in this period close to 40% of its volume. BDI is currently below levels of 5 Feb 2009 when the index was rising” said Mr. Cotzias. The market hasn’t seen such low levels since November of 2002, except of course the October 2008 market crash.
In a separate analysis, BIMCO’s shipping analyst Peter Sand said that all in all – the worst flooding in Queensland for more than 50 years “is not only bad for Australia, it's also bad for shipping as volumes on coal and iron ore go down considerably - and more vessels are free on the market putting pressure on the spot market for vessels. Average Capesize time charter rate that has been falling since end of November is now down at USD 11,266 per day trading lower every day” said Sand. He went on to state that iron ore which is exported out of West Australia is not directly affected yet even though that area has received much rain also. Lower steel production and thus also lower seaborne volumes of the two key dry bulk commodities is set to impact the market negatively over the next months. Australia is the world's largest overall coal exporter ,No. 2 in thermal coal exports after Indonesia but second to none in coking coal exports. Australia is key global coking coal supplier accounting for 60% of global seaborne exports. Within thermal coal Australia accounts for 20%. Thermal coal is used for power generation and heating, while coking coal is used in the production steel. As we have already seen, coal customers will try to find other ways to satisfy their demand for thermal coal but the real trouble is coking coal - as it is very hard to get from elsewhere. Shortage of Australian coking coal means that the worlds steel producers, primarily located in Asia, can be forced to cut the production of steel and with it also the demand for iron ore. ”A slowdown in steel production and iron ore demand is toxic to dry bulk shipping in general and for the larger vessels, Capesize and Panamax in particular. The iron ore contract prices for Q1-2011 have already been set at 7% higher than the previous quarter - but spot iron ore prices can still fluctuate and will move south on lower demand. China imports 40-50% of its coking coal from Australia. Japan, the world’s largest coking coal importer is heavily impacted also. The flooding may see contract prices for coking coal hiking significantly due to spot prices going sharply up as a result of the tight market. A part of the mechanism behind the contract prices is the spot price development. This may result in coking coal prices moving from USD 225 per tonnes in Q1-2011 up to USD 270-300 per tonnes according to several commodity analysts.
When the mines call force majeure - the steel mills must go to the spot market for coking coal - at a much higher price than the contract price for this important steel production ingredient - if they can get it at all. Alternative sources of coking coal are the US and Canada but reports are that the tight market has impacted prices also there, leading to higher commodity prices. So if coking coal spot goes up on tight supply - iron ore spot price can go down as a consequence of lower demand. A price hike in coking coal will increase the
production cost for steel - in a market already running on low margins” said BIMCO’s analyst.
So where will it go from here? “It is a string of events that cause shipping demand out of Australia to go down. Moreover the market place is plentifully supplied with tonnage so the fact that some of the commodities will be supplied from sources further away will only have very limited impact on the market. The first quarter of 2011 - do not hold great prospects for the dry bulk market - mainly because the oversupply of vessels is getting too heavy even for the "normal" inefficiencies of the market to make impact on the freight rates. The Australian situation is set to affect the market for at least a of couple months - meaning that the situation outlined above will stay a drag on the overall market and freight rates for some time” concluded Sand.
Talking about the potential overcapacity, Cotzias said that there is a total of over 3,500 dry bulk carriers on order pending until 2014 of a total of 250 million tons dwt. “These orders are split chronologically as follows: 1,854 ships are due for 2011 making up a total of 128 mil dwt, 1,106 ships due in 2012 of 87 mil dwt and 360 ships of 30 mil dwt due for 2013-2014. In total there is a massive orderbook only on the Bulkers section and we should not understate the fact that 2011 faces us with more than 55% of the total orderbook and that we should also include in this 114 orders of 4mil dwt that are “carried forward” from 2010”.
Source: Nikos Roussanoglou, Hellenic Shipping
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Tuesday, 08 February 11
PUSTAKA JAYA PALU POWER LOOKING FOR 5800 GAD COAL
COALspot.com - According to market information, PT Pustaka Jaya Palu Power, a power plant operator of the Mpanau plant, Palu, Sulawesi has invited c ...
Tuesday, 08 February 11
BAYAN, KANGAROO EXTEND DUE DILIGENCE
Coal miner controlled by businessman Dato' Low Tuck Kwong PT Bayan Resources Tbk (BYAN) and Australia-listed coal company Kangaroo Resources Limite ...
Tuesday, 08 February 11
DRY BULK: IS THE TIDE TURNING? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what could be perceived as a change of market sentiment for the better, the dry bulk industry’s benchmark, the Baltic Dry Index (BDI) poste ...
Monday, 07 February 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 13.03 PERCENT IN FEBRUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the February 2011 Indonesian Coal Reference Price for therma ...
Monday, 07 February 11
COAL PRICES ON RISE: DEMAND FROM INDIA AND CHINA - ANALYZED SUNIL K KUMBHAT
INDONESIA IS HEART OF ASIAN COAL BOOM
COALspot.com - Rising demand of Coal from India and China, coupled with global financial recovery, is driv ...
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- Sical Logistics Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Vizag Seaport Private Limited - India
- The University of Queensland
- Global Green Power PLC Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- PNOC Exploration Corporation - Philippines
- White Energy Company Limited
- OPG Power Generation Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- South Luzon Thermal Energy Corporation
- Orica Mining Services - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Singapore Mercantile Exchange
- Sinarmas Energy and Mining - Indonesia
- Eastern Coal Council - USA
- Pipit Mutiara Jaya. PT, Indonesia
- Semirara Mining Corp, Philippines
- Standard Chartered Bank - UAE
- Chettinad Cement Corporation Ltd - India
- The State Trading Corporation of India Ltd
- Rio Tinto Coal - Australia
- Ministry of Transport, Egypt
- Tata Chemicals Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Energy Development Corp, Philippines
- Cement Manufacturers Association - India
- Billiton Holdings Pty Ltd - Australia
- Indian Energy Exchange, India
- International Coal Ventures Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Carbofer General Trading SA - India
- Parliament of New Zealand
- CNBM International Corporation - China
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- Larsen & Toubro Limited - India
- Ind-Barath Power Infra Limited - India
- Timah Investasi Mineral - Indoneisa
- Ambuja Cements Ltd - India
- Bukit Baiduri Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- The Treasury - Australian Government
- Mjunction Services Limited - India
- ICICI Bank Limited - India
- Bukit Makmur.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Georgia Ports Authority, United States
- GVK Power & Infra Limited - India
- Jaiprakash Power Ventures ltd
- Trasteel International SA, Italy
- Independent Power Producers Association of India
- IHS Mccloskey Coal Group - USA
- Intertek Mineral Services - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Thiess Contractors Indonesia
- Binh Thuan Hamico - Vietnam
- Makarim & Taira - Indonesia
- CIMB Investment Bank - Malaysia
- Bhatia International Limited - India
- India Bulls Power Limited - India
- GMR Energy Limited - India
- Riau Bara Harum - Indonesia
- Barasentosa Lestari - Indonesia
- Kumho Petrochemical, South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- Merrill Lynch Commodities Europe
- McConnell Dowell - Australia
- Edison Trading Spa - Italy
- Jorong Barutama Greston.PT - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Deloitte Consulting - India
- Meenaskhi Energy Private Limited - India
- Interocean Group of Companies - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Goldman Sachs - Singapore
- Karaikal Port Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Gujarat Sidhee Cement - India
- Indonesian Coal Mining Association
- Romanian Commodities Exchange
- Coal and Oil Company - UAE
- Xindia Steels Limited - India
- Mercator Lines Limited - India
- Formosa Plastics Group - Taiwan
- Tamil Nadu electricity Board
- Orica Australia Pty. Ltd.
- Iligan Light & Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Meralco Power Generation, Philippines
- SMG Consultants - Indonesia
- LBH Netherlands Bv - Netherlands
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Bayan Resources Tbk. - Indonesia
- San Jose City I Power Corp, Philippines
- SMC Global Power, Philippines
- Grasim Industreis Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Medco Energi Mining Internasional
- Eastern Energy - Thailand
- Krishnapatnam Port Company Ltd. - India
- Vedanta Resources Plc - India
- Sakthi Sugars Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Aditya Birla Group - India
- Wood Mackenzie - Singapore
- Ministry of Finance - Indonesia
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- SN Aboitiz Power Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indo Tambangraya Megah - Indonesia
- Price Waterhouse Coopers - Russia
- Metalloyd Limited - United Kingdom
- Parry Sugars Refinery, India
- Global Coal Blending Company Limited - Australia
- Mintek Dendrill Indonesia
- Maheswari Brothers Coal Limited - India
- Altura Mining Limited, Indonesia
- Thai Mozambique Logistica
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- GAC Shipping (India) Pvt Ltd
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Africa Commodities Group - South Africa
- Ceylon Electricity Board - Sri Lanka
- Antam Resourcindo - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kalimantan Lumbung Energi - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Sree Jayajothi Cements Limited - India
- Global Business Power Corporation, Philippines
- Commonwealth Bank - Australia
- Electricity Generating Authority of Thailand
- Minerals Council of Australia
- PTC India Limited - India
- Globalindo Alam Lestari - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Electricity Authority, New Zealand
- Straits Asia Resources Limited - Singapore
- Mercuria Energy - Indonesia
- Attock Cement Pakistan Limited
- Central Java Power - Indonesia
- Port Waratah Coal Services - Australia
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement PLC, Thailand
- Malabar Cements Ltd - India
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Central Electricity Authority - India
- Indian Oil Corporation Limited
- New Zealand Coal & Carbon
- Bulk Trading Sa - Switzerland
- European Bulk Services B.V. - Netherlands
- Star Paper Mills Limited - India
- Marubeni Corporation - India
- Posco Energy - South Korea
- Directorate Of Revenue Intelligence - India
- Bhushan Steel Limited - India
- ASAPP Information Group - India
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Petron Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Power Finance Corporation Ltd., India
- Baramulti Group, Indonesia
- Essar Steel Hazira Ltd - India
- Coastal Gujarat Power Limited - India
- Latin American Coal - Colombia
- Dalmia Cement Bharat India
- Ministry of Mines - Canada
- Salva Resources Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- PowerSource Philippines DevCo
- Manunggal Multi Energi - Indonesia
- Lanco Infratech Ltd - India
- Sojitz Corporation - Japan
- Videocon Industries ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- MS Steel International - UAE
- Australian Coal Association
- Chamber of Mines of South Africa
- Uttam Galva Steels Limited - India
- Oldendorff Carriers - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Savvy Resources Ltd - HongKong
- Borneo Indobara - Indonesia
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- Bharathi Cement Corporation - India
- Wilmar Investment Holdings
- Planning Commission, India
- Economic Council, Georgia
- Kepco SPC Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- London Commodity Brokers - England
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