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