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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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- Bhushan Steel Limited - India
- Indogreen Group - Indonesia
- Formosa Plastics Group - Taiwan
- The Treasury - Australian Government
- Coalindo Energy - Indonesia
- Vizag Seaport Private Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- Ceylon Electricity Board - Sri Lanka
- GAC Shipping (India) Pvt Ltd
- Siam City Cement PLC, Thailand
- Bhatia International Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Sidhee Cement - India
- Gujarat Mineral Development Corp Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Australian Commodity Traders Exchange
- Central Java Power - Indonesia
- Georgia Ports Authority, United States
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Lanco Infratech Ltd - India
- Singapore Mercantile Exchange
- OPG Power Generation Pvt Ltd - India
- GMR Energy Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Tata Chemicals Ltd - India
- Port Waratah Coal Services - Australia
- Africa Commodities Group - South Africa
- Global Coal Blending Company Limited - Australia
- Manunggal Multi Energi - Indonesia
- Simpson Spence & Young - Indonesia
- Eastern Coal Council - USA
- Bangladesh Power Developement Board
- Altura Mining Limited, Indonesia
- Siam City Cement - Thailand
- Bukit Makmur.PT - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- IEA Clean Coal Centre - UK
- Medco Energi Mining Internasional
- CIMB Investment Bank - Malaysia
- LBH Netherlands Bv - Netherlands
- Uttam Galva Steels Limited - India
- TeaM Sual Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- Sindya Power Generating Company Private Ltd
- Metalloyd Limited - United Kingdom
- San Jose City I Power Corp, Philippines
- Agrawal Coal Company - India
- Trasteel International SA, Italy
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Savvy Resources Ltd - HongKong
- Mercator Lines Limited - India
- Semirara Mining and Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Directorate Of Revenue Intelligence - India
- Sojitz Corporation - Japan
- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- Borneo Indobara - Indonesia
- Petron Corporation, Philippines
- Indian Oil Corporation Limited
- European Bulk Services B.V. - Netherlands
- Electricity Generating Authority of Thailand
- Cement Manufacturers Association - India
- Posco Energy - South Korea
- Malabar Cements Ltd - India
- Xindia Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- Star Paper Mills Limited - India
- Latin American Coal - Colombia
- Aboitiz Power Corporation - Philippines
- Goldman Sachs - Singapore
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- SN Aboitiz Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining Corp, Philippines
- Makarim & Taira - Indonesia
- Anglo American - United Kingdom
- Antam Resourcindo - Indonesia
- International Coal Ventures Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Minerals Council of Australia
- Heidelberg Cement - Germany
- Madhucon Powers Ltd - India
- Grasim Industreis Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Bulk Trading Sa - Switzerland
- Kumho Petrochemical, South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Riau Bara Harum - Indonesia
- Dalmia Cement Bharat India
- PTC India Limited - India
- Interocean Group of Companies - India
- Mintek Dendrill Indonesia
- Parry Sugars Refinery, India
- Globalindo Alam Lestari - Indonesia
- Orica Mining Services - Indonesia
- Ind-Barath Power Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Intertek Mineral Services - Indonesia
- Energy Development Corp, Philippines
- Indika Energy - Indonesia
- Indian Energy Exchange, India
- Maheswari Brothers Coal Limited - India
- AsiaOL BioFuels Corp., Philippines
- Krishnapatnam Port Company Ltd. - India
- GVK Power & Infra Limited - India
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- Salva Resources Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- TNB Fuel Sdn Bhd - Malaysia
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Jorong Barutama Greston.PT - Indonesia
- Wilmar Investment Holdings
- The State Trading Corporation of India Ltd
- Kobexindo Tractors - Indoneisa
- Power Finance Corporation Ltd., India
- Thai Mozambique Logistica
- Bahari Cakrawala Sebuku - Indonesia
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- MS Steel International - UAE
- Sakthi Sugars Limited - India
- Global Business Power Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Standard Chartered Bank - UAE
- Gujarat Electricity Regulatory Commission - India
- Indonesian Coal Mining Association
- Economic Council, Georgia
- Eastern Energy - Thailand
- Barasentosa Lestari - Indonesia
- Rio Tinto Coal - Australia
- Coal and Oil Company - UAE
- Timah Investasi Mineral - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- White Energy Company Limited
- Orica Australia Pty. Ltd.
- Rashtriya Ispat Nigam Limited - India
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Parliament of New Zealand
- Independent Power Producers Association of India
- Mercuria Energy - Indonesia
- Mjunction Services Limited - India
- Ministry of Mines - Canada
- CNBM International Corporation - China
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- McConnell Dowell - Australia
- London Commodity Brokers - England
- Iligan Light & Power Inc, Philippines
- The University of Queensland
- Maharashtra Electricity Regulatory Commission - India
- Global Green Power PLC Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Romanian Commodities Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Central Electricity Authority - India
- Commonwealth Bank - Australia
- Merrill Lynch Commodities Europe
- South Luzon Thermal Energy Corporation
- Ministry of Transport, Egypt
- Carbofer General Trading SA - India
- PowerSource Philippines DevCo
- Bukit Baiduri Energy - Indonesia
- VISA Power Limited - India
- Aditya Birla Group - India
- Jindal Steel & Power Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- India Bulls Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Meralco Power Generation, Philippines
- Baramulti Group, Indonesia
- Kartika Selabumi Mining - Indonesia
- ASAPP Information Group - India
- Samtan Co., Ltd - South Korea
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Ambuja Cements Ltd - India
- Bharathi Cement Corporation - India
- Banpu Public Company Limited - Thailand
- Straits Asia Resources Limited - Singapore
- Kapuas Tunggal Persada - Indonesia
- Deloitte Consulting - India
- Attock Cement Pakistan Limited
- Pendopo Energi Batubara - Indonesia
- Chamber of Mines of South Africa
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- New Zealand Coal & Carbon
- Wood Mackenzie - Singapore
- Australian Coal Association
- Neyveli Lignite Corporation Ltd, - India
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
- SMC Global Power, Philippines
- Coastal Gujarat Power Limited - India
- Ministry of Finance - Indonesia
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