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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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Monday, 10 January 11
DEWA SEEKS ADVICE ON COAL POWER PROJECT -THE NATIONAL
The Dubai utility company gets nine bids from international groups for consultancy role.
The National reported that, Dubai's utility company wil ...
Saturday, 08 January 11
COAL PRICE WILL RISE IN SHORT-TERM DUE TO AUSTRALIA FLOODS - ALBUQUERQUE EXPRESS
Albuquerque Express reported that, Queensland’s mining minister, Stephen Robertson, has warned that the Australian state’s coal mines wi ...
Saturday, 08 January 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 8.69 PERCENT IN JANUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the January 2011 Indonesian Coal Reference Price for thermal ...
Saturday, 08 January 11
SUPRAMAX VESSELS WERE FIXED AT AROUND $ 9000 PD FOR A TRIP VIA INDONESIA TO INDIA - VISTAAR
COALspot.com - The holiday season affect combined with severe flooding in Queensland ports continues to keep the market and pressure. “Suprama ...
Saturday, 08 January 11
DIFFICULT YEAR FOR SHIPPING - TRANSPORT WEEKLY
Transport Weekly reported that, Shipping Corporation of India (SCI) chairman Sabyasachi Hajara says 2011 will be a difficult year because an excess ...
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- VISA Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- Riau Bara Harum - Indonesia
- IHS Mccloskey Coal Group - USA
- Georgia Ports Authority, United States
- Central Java Power - Indonesia
- Salva Resources Pvt Ltd - India
- Sical Logistics Limited - India
- San Jose City I Power Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- Sojitz Corporation - Japan
- Krishnapatnam Port Company Ltd. - India
- Antam Resourcindo - Indonesia
- McConnell Dowell - Australia
- Parry Sugars Refinery, India
- Attock Cement Pakistan Limited
- Petrochimia International Co. Ltd.- Taiwan
- Timah Investasi Mineral - Indoneisa
- Thiess Contractors Indonesia
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- South Luzon Thermal Energy Corporation
- Sarangani Energy Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Energy Development Corp, Philippines
- Karaikal Port Pvt Ltd - India
- Aditya Birla Group - India
- Bharathi Cement Corporation - India
- GAC Shipping (India) Pvt Ltd
- Anglo American - United Kingdom
- Goldman Sachs - Singapore
- Global Business Power Corporation, Philippines
- Minerals Council of Australia
- Coalindo Energy - Indonesia
- Tamil Nadu electricity Board
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Karbindo Abesyapradhi - Indoneisa
- Maheswari Brothers Coal Limited - India
- Gujarat Sidhee Cement - India
- Electricity Authority, New Zealand
- Jindal Steel & Power Ltd - India
- Orica Mining Services - Indonesia
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Heidelberg Cement - Germany
- OPG Power Generation Pvt Ltd - India
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Iligan Light & Power Inc, Philippines
- Deloitte Consulting - India
- Coastal Gujarat Power Limited - India
- Intertek Mineral Services - Indonesia
- Wilmar Investment Holdings
- Energy Link Ltd, New Zealand
- Renaissance Capital - South Africa
- Siam City Cement - Thailand
- Uttam Galva Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Bhatia International Limited - India
- Interocean Group of Companies - India
- Oldendorff Carriers - Singapore
- Power Finance Corporation Ltd., India
- Australian Commodity Traders Exchange
- Malabar Cements Ltd - India
- Trasteel International SA, Italy
- Barasentosa Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indian Oil Corporation Limited
- Chamber of Mines of South Africa
- Larsen & Toubro Limited - India
- Marubeni Corporation - India
- Star Paper Mills Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Rio Tinto Coal - Australia
- Planning Commission, India
- Pendopo Energi Batubara - Indonesia
- IEA Clean Coal Centre - UK
- Cement Manufacturers Association - India
- New Zealand Coal & Carbon
- Indonesian Coal Mining Association
- Latin American Coal - Colombia
- Bahari Cakrawala Sebuku - Indonesia
- PowerSource Philippines DevCo
- CNBM International Corporation - China
- Agrawal Coal Company - India
- Pipit Mutiara Jaya. PT, Indonesia
- Chettinad Cement Corporation Ltd - India
- Siam City Cement PLC, Thailand
- Coal and Oil Company - UAE
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Mercuria Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Essar Steel Hazira Ltd - India
- Bukit Baiduri Energy - Indonesia
- Mercator Lines Limited - India
- Kartika Selabumi Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Transport, Egypt
- Formosa Plastics Group - Taiwan
- Romanian Commodities Exchange
- Kalimantan Lumbung Energi - Indonesia
- Dalmia Cement Bharat India
- Ceylon Electricity Board - Sri Lanka
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Borneo Indobara - Indonesia
- Xindia Steels Limited - India
- Madhucon Powers Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Manunggal Multi Energi - Indonesia
- Petron Corporation, Philippines
- ICICI Bank Limited - India
- Meenaskhi Energy Private Limited - India
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Indo Tambangraya Megah - Indonesia
- Kideco Jaya Agung - Indonesia
- GMR Energy Limited - India
- GVK Power & Infra Limited - India
- Medco Energi Mining Internasional
- White Energy Company Limited
- Wood Mackenzie - Singapore
- Kumho Petrochemical, South Korea
- Straits Asia Resources Limited - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Baramulti Group, Indonesia
- Sree Jayajothi Cements Limited - India
- Posco Energy - South Korea
- Australian Coal Association
- Binh Thuan Hamico - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Lanco Infratech Ltd - India
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Indika Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- The Treasury - Australian Government
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- Independent Power Producers Association of India
- International Coal Ventures Pvt Ltd - India
- The University of Queensland
- Mjunction Services Limited - India
- Videocon Industries ltd - India
- PNOC Exploration Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Directorate General of MIneral and Coal - Indonesia
- Standard Chartered Bank - UAE
- Savvy Resources Ltd - HongKong
- Price Waterhouse Coopers - Russia
- European Bulk Services B.V. - Netherlands
- Ministry of Mines - Canada
- LBH Netherlands Bv - Netherlands
- Parliament of New Zealand
- Kepco SPC Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Africa Commodities Group - South Africa
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- Globalindo Alam Lestari - Indonesia
- Makarim & Taira - Indonesia
- Ind-Barath Power Infra Limited - India
- Sakthi Sugars Limited - India
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Eastern Coal Council - USA
- Kaltim Prima Coal - Indonesia
- India Bulls Power Limited - India
- The State Trading Corporation of India Ltd
- Ministry of Finance - Indonesia
- ASAPP Information Group - India
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Eastern Energy - Thailand
- Directorate Of Revenue Intelligence - India
- Carbofer General Trading SA - India
- Edison Trading Spa - Italy
- Cigading International Bulk Terminal - Indonesia
- Singapore Mercantile Exchange
- Sinarmas Energy and Mining - Indonesia
- Global Coal Blending Company Limited - Australia
- Banpu Public Company Limited - Thailand
- Economic Council, Georgia
- Vijayanagar Sugar Pvt Ltd - India
- MS Steel International - UAE
- Bhushan Steel Limited - India
- Thai Mozambique Logistica
- Neyveli Lignite Corporation Ltd, - India
- Electricity Generating Authority of Thailand
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- Global Green Power PLC Corporation, Philippines
- Bhoruka Overseas - Indonesia
- TeaM Sual Corporation - Philippines
- Rashtriya Ispat Nigam Limited - India
- Aboitiz Power Corporation - Philippines
- Bayan Resources Tbk. - Indonesia
- Grasim Industreis Ltd - India
- Indian Energy Exchange, India
- Mintek Dendrill Indonesia
- London Commodity Brokers - England
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bangladesh Power Developement Board
- Jaiprakash Power Ventures ltd
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