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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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Wednesday, 02 February 11
BAYAN TO SUPPLY COAL TO TP UTILITIES LTD
Insider Stories has reportd that, Indonesia's one of the leading coal miner PT Bayan Resources Tbk (BYAN) owned by businessman Dato' Low Tuck ...
Wednesday, 02 February 11
HUGE TONNAGE OVERSUPPLY LOOMING FOR DRY BULK MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the dry bulk market taking another dive yesterday, to just over 1,000 points (1,084), losing more than 2% on the day, it’s more than obvi ...
Monday, 31 January 11
S. SUMATRA COAL RAILWAY TO BE COMPLETED ON SCHEDULE - THE JAKARTA POST
The Jakarta Post reported that, despite land acquisition problems, state coal mining company PT Bukit Asam is upbeat that the development of a railw ...
Monday, 31 January 11
COAL MINER PTBA TO DRIVE OUTPUT WITH ACQUISITIONS - THE JAKARTA GLOBE
The Jakarta Globe reported that, State coal company Perusahaan Tambang Batubara Bukit Asam said its output would increase 34 percent to 17.6 million ...
Saturday, 29 January 11
PRESSURE ON SHIPPING MARKET MAY CONTINUE UNTIL MID FEBRUARY 2011
COALspot.com - The BDI continues to drop and saw a drop of about 5 pct this week closing at 1370 points.
In May 2010 the BDI touched 4,209 ...
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- Manunggal Multi Energi - Indonesia
- Latin American Coal - Colombia
- Economic Council, Georgia
- Dalmia Cement Bharat India
- McConnell Dowell - Australia
- Mercuria Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Bayan Resources Tbk. - Indonesia
- Australian Coal Association
- Sinarmas Energy and Mining - Indonesia
- Jaiprakash Power Ventures ltd
- IHS Mccloskey Coal Group - USA
- Rashtriya Ispat Nigam Limited - India
- Parliament of New Zealand
- Energy Link Ltd, New Zealand
- TeaM Sual Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Neyveli Lignite Corporation Ltd, - India
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Kideco Jaya Agung - Indonesia
- Xindia Steels Limited - India
- Directorate Of Revenue Intelligence - India
- Indian Energy Exchange, India
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Tata Chemicals Ltd - India
- MS Steel International - UAE
- Krishnapatnam Port Company Ltd. - India
- Karaikal Port Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Intertek Mineral Services - Indonesia
- Iligan Light & Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Singapore Mercantile Exchange
- Formosa Plastics Group - Taiwan
- Bulk Trading Sa - Switzerland
- Videocon Industries ltd - India
- Australian Commodity Traders Exchange
- Mintek Dendrill Indonesia
- Ambuja Cements Ltd - India
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- Attock Cement Pakistan Limited
- Parry Sugars Refinery, India
- Sakthi Sugars Limited - India
- Therma Luzon, Inc, Philippines
- Barasentosa Lestari - Indonesia
- Sical Logistics Limited - India
- Kaltim Prima Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Aboitiz Power Corporation - Philippines
- Star Paper Mills Limited - India
- ASAPP Information Group - India
- Petrochimia International Co. Ltd.- Taiwan
- Global Coal Blending Company Limited - Australia
- Globalindo Alam Lestari - Indonesia
- GAC Shipping (India) Pvt Ltd
- Cement Manufacturers Association - India
- LBH Netherlands Bv - Netherlands
- VISA Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Baramulti Group, Indonesia
- Romanian Commodities Exchange
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Pendopo Energi Batubara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Indogreen Group - Indonesia
- Kumho Petrochemical, South Korea
- Heidelberg Cement - Germany
- CIMB Investment Bank - Malaysia
- PTC India Limited - India
- Global Business Power Corporation, Philippines
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Sindya Power Generating Company Private Ltd
- Indo Tambangraya Megah - Indonesia
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Ministry of Mines - Canada
- Kepco SPC Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Goldman Sachs - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement PLC, Thailand
- Maharashtra Electricity Regulatory Commission - India
- Indika Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Edison Trading Spa - Italy
- Miang Besar Coal Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Renaissance Capital - South Africa
- The University of Queensland
- Timah Investasi Mineral - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Central Java Power - Indonesia
- Larsen & Toubro Limited - India
- Trasteel International SA, Italy
- Central Electricity Authority - India
- GMR Energy Limited - India
- Sree Jayajothi Cements Limited - India
- San Jose City I Power Corp, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aditya Birla Group - India
- Riau Bara Harum - Indonesia
- Carbofer General Trading SA - India
- OPG Power Generation Pvt Ltd - India
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Makarim & Taira - Indonesia
- Maheswari Brothers Coal Limited - India
- Coal and Oil Company - UAE
- Ind-Barath Power Infra Limited - India
- Altura Mining Limited, Indonesia
- European Bulk Services B.V. - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sojitz Corporation - Japan
- White Energy Company Limited
- Interocean Group of Companies - India
- Vijayanagar Sugar Pvt Ltd - India
- Borneo Indobara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Cigading International Bulk Terminal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coalindo Energy - Indonesia
- Indian Oil Corporation Limited
- Mercator Lines Limited - India
- India Bulls Power Limited - India
- PNOC Exploration Corporation - Philippines
- Chamber of Mines of South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Toyota Tsusho Corporation, Japan
- Planning Commission, India
- Eastern Coal Council - USA
- Mjunction Services Limited - India
- Agrawal Coal Company - India
- Semirara Mining Corp, Philippines
- Ministry of Transport, Egypt
- Deloitte Consulting - India
- Indonesian Coal Mining Association
- Electricity Authority, New Zealand
- Bharathi Cement Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Medco Energi Mining Internasional
- Straits Asia Resources Limited - Singapore
- AsiaOL BioFuels Corp., Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Electricity Regulatory Commission - India
- Independent Power Producers Association of India
- Thai Mozambique Logistica
- Orica Mining Services - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Savvy Resources Ltd - HongKong
- ICICI Bank Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Grasim Industreis Ltd - India
- Uttam Galva Steels Limited - India
- Anglo American - United Kingdom
- Minerals Council of Australia
- The State Trading Corporation of India Ltd
- Madhucon Powers Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhatia International Limited - India
- GVK Power & Infra Limited - India
- Bhoruka Overseas - Indonesia
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- SMC Global Power, Philippines
- Global Green Power PLC Corporation, Philippines
- Energy Development Corp, Philippines
- Bangladesh Power Developement Board
- Antam Resourcindo - Indonesia
- London Commodity Brokers - England
- Jorong Barutama Greston.PT - Indonesia
- IEA Clean Coal Centre - UK
- New Zealand Coal & Carbon
- Orica Australia Pty. Ltd.
- Vizag Seaport Private Limited - India
- Coastal Gujarat Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Bukit Makmur.PT - Indonesia
- Kobexindo Tractors - Indoneisa
- Ministry of Finance - Indonesia
- Eastern Energy - Thailand
- Commonwealth Bank - Australia
- Vedanta Resources Plc - India
- Electricity Generating Authority of Thailand
- PowerSource Philippines DevCo
- Power Finance Corporation Ltd., India
- SMG Consultants - Indonesia
- Gujarat Sidhee Cement - India
- Metalloyd Limited - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- Oldendorff Carriers - Singapore
- Holcim Trading Pte Ltd - Singapore
- Meenaskhi Energy Private Limited - India
- Sarangani Energy Corporation, Philippines
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- Price Waterhouse Coopers - Russia
- The Treasury - Australian Government
- Semirara Mining and Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
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