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