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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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Saturday, 29 January 11
ANTAM ACQUIRES SAROLANGUN COAL MINING
According to Insider Stories, Nickel and gold miner PT Aneka Tambang Tbk (Antam) of Indonesia via its subsidiary PT Indonesia Coal Resources (ICR) h ...
Friday, 28 January 11
MPM SEEKS 40K TONS OF INDONESIAN COAL
An Indian paper producer Mysore Paper Mills Ltd., based in Bangalore is looking for 40,000 metric tons of non-coking coal of Indonesian o ...
Friday, 28 January 11
TRADING PERMIT DELAYS THREATEN EXPORTS - THE JAKARTA GLOBE
The Jakarta Globe reported that, an ongoing wrangle over licenses for mining traders could hurt investment, a coal mining association chief said on ...
Friday, 28 January 11
DRY BULK MARKET CLOSING IN TOWARDS CRISIS LEVELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The trials and tribulations of the dry bulk market seem to have no end during the first month of 2011, as the industry’s benchmark, the Baltic ...
Wednesday, 26 January 11
ADANI TO SET-UP RAIL, PORT AND POWER PROJECTS IN INDONESIA - MONEYCONTROL
Moneycontrol reported that, Adani Enterprises, the flagship company of India’s infrastructure conglomerate the Adani Group, today announced th ...
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- Makarim & Taira - Indonesia
- Chettinad Cement Corporation Ltd - India
- Eastern Energy - Thailand
- Sindya Power Generating Company Private Ltd
- Maheswari Brothers Coal Limited - India
- Binh Thuan Hamico - Vietnam
- Formosa Plastics Group - Taiwan
- Oldendorff Carriers - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhushan Steel Limited - India
- Mintek Dendrill Indonesia
- Meralco Power Generation, Philippines
- Energy Development Corp, Philippines
- Minerals Council of Australia
- Therma Luzon, Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Agrawal Coal Company - India
- Australian Commodity Traders Exchange
- Maharashtra Electricity Regulatory Commission - India
- New Zealand Coal & Carbon
- Borneo Indobara - Indonesia
- IEA Clean Coal Centre - UK
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Xindia Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Global Business Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Coastal Gujarat Power Limited - India
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Independent Power Producers Association of India
- Krishnapatnam Port Company Ltd. - India
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- PetroVietnam Power Coal Import and Supply Company
- GMR Energy Limited - India
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- Banpu Public Company Limited - Thailand
- Posco Energy - South Korea
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- IHS Mccloskey Coal Group - USA
- Indian Oil Corporation Limited
- Aditya Birla Group - India
- Economic Council, Georgia
- Sinarmas Energy and Mining - Indonesia
- Central Electricity Authority - India
- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- London Commodity Brokers - England
- The Treasury - Australian Government
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Asam (Persero) Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- White Energy Company Limited
- South Luzon Thermal Energy Corporation
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Madhucon Powers Ltd - India
- Mjunction Services Limited - India
- Ind-Barath Power Infra Limited - India
- Salva Resources Pvt Ltd - India
- Rio Tinto Coal - Australia
- Kohat Cement Company Ltd. - Pakistan
- Singapore Mercantile Exchange
- Bharathi Cement Corporation - India
- Bulk Trading Sa - Switzerland
- LBH Netherlands Bv - Netherlands
- Deloitte Consulting - India
- Ministry of Transport, Egypt
- Straits Asia Resources Limited - Singapore
- CIMB Investment Bank - Malaysia
- Antam Resourcindo - Indonesia
- SN Aboitiz Power Inc, Philippines
- Jindal Steel & Power Ltd - India
- Uttam Galva Steels Limited - India
- Renaissance Capital - South Africa
- Kumho Petrochemical, South Korea
- Ceylon Electricity Board - Sri Lanka
- Bukit Makmur.PT - Indonesia
- MS Steel International - UAE
- Sree Jayajothi Cements Limited - India
- Indonesian Coal Mining Association
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- PowerSource Philippines DevCo
- Iligan Light & Power Inc, Philippines
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- San Jose City I Power Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- SMC Global Power, Philippines
- Ministry of Mines - Canada
- Global Coal Blending Company Limited - Australia
- The University of Queensland
- Videocon Industries ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- GAC Shipping (India) Pvt Ltd
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Kaltim Prima Coal - Indonesia
- Coalindo Energy - Indonesia
- Latin American Coal - Colombia
- Vizag Seaport Private Limited - India
- Planning Commission, India
- Metalloyd Limited - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- Parliament of New Zealand
- Wilmar Investment Holdings
- Vijayanagar Sugar Pvt Ltd - India
- Commonwealth Bank - Australia
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Tamil Nadu electricity Board
- GN Power Mariveles Coal Plant, Philippines
- Power Finance Corporation Ltd., India
- Holcim Trading Pte Ltd - Singapore
- ICICI Bank Limited - India
- Indogreen Group - Indonesia
- Gujarat Sidhee Cement - India
- Heidelberg Cement - Germany
- Alfred C Toepfer International GmbH - Germany
- Samtan Co., Ltd - South Korea
- Bukit Baiduri Energy - Indonesia
- Thiess Contractors Indonesia
- Marubeni Corporation - India
- Rashtriya Ispat Nigam Limited - India
- CNBM International Corporation - China
- Essar Steel Hazira Ltd - India
- Central Java Power - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Sical Logistics Limited - India
- Australian Coal Association
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bangladesh Power Developement Board
- Mercator Lines Limited - India
- Larsen & Toubro Limited - India
- Toyota Tsusho Corporation, Japan
- Lanco Infratech Ltd - India
- Meenaskhi Energy Private Limited - India
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- Sakthi Sugars Limited - India
- Savvy Resources Ltd - HongKong
- International Coal Ventures Pvt Ltd - India
- Trasteel International SA, Italy
- Electricity Authority, New Zealand
- TeaM Sual Corporation - Philippines
- Star Paper Mills Limited - India
- AsiaOL BioFuels Corp., Philippines
- Vedanta Resources Plc - India
- Sarangani Energy Corporation, Philippines
- Medco Energi Mining Internasional
- Directorate General of MIneral and Coal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Standard Chartered Bank - UAE
- Anglo American - United Kingdom
- Semirara Mining Corp, Philippines
- Merrill Lynch Commodities Europe
- Grasim Industreis Ltd - India
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Cement Manufacturers Association - India
- Coal and Oil Company - UAE
- Bhoruka Overseas - Indonesia
- Carbofer General Trading SA - India
- India Bulls Power Limited - India
- Altura Mining Limited, Indonesia
- Parry Sugars Refinery, India
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- Karaikal Port Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Wood Mackenzie - Singapore
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Orica Mining Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Kepco SPC Power Corporation, Philippines
- Thai Mozambique Logistica
- Intertek Mineral Services - Indonesia
- Africa Commodities Group - South Africa
- Bayan Resources Tbk. - Indonesia
- Siam City Cement - Thailand
- Bhatia International Limited - India
- Directorate Of Revenue Intelligence - India
- Malabar Cements Ltd - India
- Attock Cement Pakistan Limited
- Indika Energy - Indonesia
- McConnell Dowell - Australia
- PNOC Exploration Corporation - Philippines
- Edison Trading Spa - Italy
- PTC India Limited - India
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