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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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Friday, 04 February 11
PERTAMINA DENIES KAREN AGUSTIAWAN RESIGNS FROM PERTAMINA
COALspot.com - The President Director of PT Pertamina, Karen Agustiawan reportedly will replace Darwin Saleh as Minister of Energy and Mineral Resou ...
Friday, 04 February 11
ADARO ENERGY FY10 COAL SALES UP 6 PERCENT TO 43.84 MILLION
As reported by insider stories, Indonesian coal miners PT Adaro Energy Tbk has produced 42.20 million tons of coal in 2010, a 4 percent increase com ...
Thursday, 03 February 11
MERCATOR LINES TO INVEST RS 200-250 CRORE ON COAL MINE IN INDONESIA - ECONOMIC TIMES
Economic Times reported that, Mercator Lines, the HK Mittal-controlled shipping-to-mines major, will invest about 200-250 crore (US$ 43.825 - 54.781 ...
Thursday, 03 February 11
DRY BULK MARKET LOOKS SET TO BOTTOM OUT NIKOS - ROUSSANOGLOU, HELLENIC SHIPPING
With the dry bulk market having lost more than 72% of its value in the last month or so and having retreated to a 2-year low, it seems that the bott ...
Wednesday, 02 February 11
INDONESIA MAY MISS COAL EXPORT TARGET IN 2011
COALspot.com - Indonesian Trade ministry has instructed independent surveyors temporarily not to issue pre-shipment survey report (LS) to the compan ...
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- Meralco Power Generation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Globalindo Alam Lestari - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Ministry of Mines - Canada
- Gujarat Sidhee Cement - India
- Energy Link Ltd, New Zealand
- Riau Bara Harum - Indonesia
- Global Business Power Corporation, Philippines
- Latin American Coal - Colombia
- Therma Luzon, Inc, Philippines
- Tata Chemicals Ltd - India
- Global Green Power PLC Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sarangani Energy Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Oldendorff Carriers - Singapore
- Vizag Seaport Private Limited - India
- Carbofer General Trading SA - India
- Edison Trading Spa - Italy
- Africa Commodities Group - South Africa
- AsiaOL BioFuels Corp., Philippines
- GN Power Mariveles Coal Plant, Philippines
- GAC Shipping (India) Pvt Ltd
- Planning Commission, India
- CNBM International Corporation - China
- Bhoruka Overseas - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Anglo American - United Kingdom
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Posco Energy - South Korea
- Kartika Selabumi Mining - Indonesia
- Medco Energi Mining Internasional
- Intertek Mineral Services - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Indo Tambangraya Megah - Indonesia
- Semirara Mining Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Vedanta Resources Plc - India
- Kaltim Prima Coal - Indonesia
- Mercator Lines Limited - India
- London Commodity Brokers - England
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- Bank of Tokyo Mitsubishi UFJ Ltd
- Parliament of New Zealand
- Salva Resources Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- McConnell Dowell - Australia
- Siam City Cement - Thailand
- Semirara Mining and Power Corporation, Philippines
- Singapore Mercantile Exchange
- Renaissance Capital - South Africa
- Merrill Lynch Commodities Europe
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Energy Development Corp, Philippines
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- Indonesian Coal Mining Association
- Central Java Power - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Bhushan Steel Limited - India
- Petron Corporation, Philippines
- Malabar Cements Ltd - India
- Trasteel International SA, Italy
- Orica Australia Pty. Ltd.
- European Bulk Services B.V. - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Simpson Spence & Young - Indonesia
- SMG Consultants - Indonesia
- Jindal Steel & Power Ltd - India
- Economic Council, Georgia
- Australian Commodity Traders Exchange
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Wood Mackenzie - Singapore
- PTC India Limited - India
- Mintek Dendrill Indonesia
- Thiess Contractors Indonesia
- Kideco Jaya Agung - Indonesia
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Electricity Authority, New Zealand
- Krishnapatnam Port Company Ltd. - India
- Ministry of Finance - Indonesia
- Coastal Gujarat Power Limited - India
- Makarim & Taira - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Barasentosa Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- LBH Netherlands Bv - Netherlands
- Videocon Industries ltd - India
- PNOC Exploration Corporation - Philippines
- Bhatia International Limited - India
- Baramulti Group, Indonesia
- Goldman Sachs - Singapore
- Commonwealth Bank - Australia
- Independent Power Producers Association of India
- Gujarat Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Minerals Council of Australia
- Electricity Generating Authority of Thailand
- Interocean Group of Companies - India
- India Bulls Power Limited - India
- Ambuja Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Australian Coal Association
- Marubeni Corporation - India
- SMC Global Power, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Directorate Of Revenue Intelligence - India
- Altura Mining Limited, Indonesia
- Wilmar Investment Holdings
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Kumho Petrochemical, South Korea
- Formosa Plastics Group - Taiwan
- Savvy Resources Ltd - HongKong
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Indian Energy Exchange, India
- Sindya Power Generating Company Private Ltd
- Chamber of Mines of South Africa
- Sakthi Sugars Limited - India
- Maheswari Brothers Coal Limited - India
- Antam Resourcindo - Indonesia
- Toyota Tsusho Corporation, Japan
- Chettinad Cement Corporation Ltd - India
- IHS Mccloskey Coal Group - USA
- Larsen & Toubro Limited - India
- Ministry of Transport, Egypt
- Heidelberg Cement - Germany
- Global Coal Blending Company Limited - Australia
- Coal and Oil Company - UAE
- South Luzon Thermal Energy Corporation
- PowerSource Philippines DevCo
- VISA Power Limited - India
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Cigading International Bulk Terminal - Indonesia
- New Zealand Coal & Carbon
- Sree Jayajothi Cements Limited - India
- Sojitz Corporation - Japan
- Power Finance Corporation Ltd., India
- The University of Queensland
- Miang Besar Coal Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Attock Cement Pakistan Limited
- Aboitiz Power Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- CIMB Investment Bank - Malaysia
- Agrawal Coal Company - India
- Thai Mozambique Logistica
- Manunggal Multi Energi - Indonesia
- Cement Manufacturers Association - India
- Coalindo Energy - Indonesia
- Georgia Ports Authority, United States
- Eastern Coal Council - USA
- White Energy Company Limited
- Central Electricity Authority - India
- GMR Energy Limited - India
- Deloitte Consulting - India
- Sical Logistics Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Banpu Public Company Limited - Thailand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Bangladesh Power Developement Board
- Holcim Trading Pte Ltd - Singapore
- ASAPP Information Group - India
- Indian Oil Corporation Limited
- IEA Clean Coal Centre - UK
- Grasim Industreis Ltd - India
- Bukit Baiduri Energy - Indonesia
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Xindia Steels Limited - India
- Ind-Barath Power Infra Limited - India
- Uttam Galva Steels Limited - India
- Straits Asia Resources Limited - Singapore
- Mjunction Services Limited - India
- Neyveli Lignite Corporation Ltd, - India
- The State Trading Corporation of India Ltd
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Mineral Development Corp Ltd - India
- OPG Power Generation Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Romanian Commodities Exchange
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement PLC, Thailand
- San Jose City I Power Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
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