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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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Friday, 07 January 11
DRY BULK MARKET ON A FREEFALL, AS THE NEW YEAR EARLY DAYS DONT BRING MANY CHEERS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market is facing its worst slump in more than two years, falling by 4.75% yesterday to reach 1,544 points, on top of an additional 4.2% ...
Thursday, 06 January 11
OVERSEAS & GENERAL SIGNS AGREEMENT TO EXPAND FOOTPRINT ON COAL LEASE IN INDONESIA - PROACTIVE INVESTORS
Proactive Investors reported that, Overseas & General (ASX: OGL) has entered into a joint operating agreement on the Jambi Coal Lease in Sumatra ...
Thursday, 06 January 11
BANPU EXPECTS ROSY 2011 AS COAL PRICES SKYROCKET - BANGKOK POST
Bangkok Post reported that, Banpu Plc, Asean's largest coal miner, expects minimal impact from the production stoppage at its Daning mine in China ...
Thursday, 06 January 11
COKING COAL CONTRACT PRICE MAY RISE 33% ON AUSTRALIAN FLOODS - BLOOMBERG
Bloomberg reported that, Steelmakers in Asia may be forced to pay as much as 33 percent more for hard coking coal after the worst floods in 50 years ...
Wednesday, 05 January 11
HIGHER COAL PRICES LIFT UP COAL STOCKS
Thermal coal price this month has gone up 5.63% to US$127.70 per ton today from mid last month at US$120.89 per ton.
Thermal coal price for next ...
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- Chettinad Cement Corporation Ltd - India
- Bhatia International Limited - India
- San Jose City I Power Corp, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Indian Oil Corporation Limited
- Orica Australia Pty. Ltd.
- Trasteel International SA, Italy
- Marubeni Corporation - India
- Africa Commodities Group - South Africa
- The University of Queensland
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Attock Cement Pakistan Limited
- Coal and Oil Company - UAE
- Siam City Cement - Thailand
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Medco Energi Mining Internasional
- Barasentosa Lestari - Indonesia
- Wilmar Investment Holdings
- Commonwealth Bank - Australia
- Sical Logistics Limited - India
- Alfred C Toepfer International GmbH - Germany
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PowerSource Philippines DevCo
- Latin American Coal - Colombia
- Sojitz Corporation - Japan
- Goldman Sachs - Singapore
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Grasim Industreis Ltd - India
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- Toyota Tsusho Corporation, Japan
- Directorate General of MIneral and Coal - Indonesia
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- Metalloyd Limited - United Kingdom
- MS Steel International - UAE
- Star Paper Mills Limited - India
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Therma Luzon, Inc, Philippines
- Planning Commission, India
- Billiton Holdings Pty Ltd - Australia
- Independent Power Producers Association of India
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Madhucon Powers Ltd - India
- Simpson Spence & Young - Indonesia
- Mjunction Services Limited - India
- Antam Resourcindo - Indonesia
- Edison Trading Spa - Italy
- Salva Resources Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Bulk Trading Sa - Switzerland
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Karbindo Abesyapradhi - Indoneisa
- Electricity Authority, New Zealand
- Pendopo Energi Batubara - Indonesia
- Sree Jayajothi Cements Limited - India
- Mintek Dendrill Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Krishnapatnam Port Company Ltd. - India
- Essar Steel Hazira Ltd - India
- Iligan Light & Power Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Larsen & Toubro Limited - India
- Australian Coal Association
- Aditya Birla Group - India
- Price Waterhouse Coopers - Russia
- ASAPP Information Group - India
- Cigading International Bulk Terminal - Indonesia
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Mines - Canada
- Rio Tinto Coal - Australia
- Karaikal Port Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- OPG Power Generation Pvt Ltd - India
- Indika Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Thai Mozambique Logistica
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bharathi Cement Corporation - India
- Central Java Power - Indonesia
- VISA Power Limited - India
- Coalindo Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- IEA Clean Coal Centre - UK
- Binh Thuan Hamico - Vietnam
- Directorate Of Revenue Intelligence - India
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- GVK Power & Infra Limited - India
- GAC Shipping (India) Pvt Ltd
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- Malabar Cements Ltd - India
- European Bulk Services B.V. - Netherlands
- Bhushan Steel Limited - India
- PNOC Exploration Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Romanian Commodities Exchange
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- SMC Global Power, Philippines
- Global Business Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Jindal Steel & Power Ltd - India
- Formosa Plastics Group - Taiwan
- Eastern Coal Council - USA
- Bukit Makmur.PT - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ind-Barath Power Infra Limited - India
- Kumho Petrochemical, South Korea
- Maheswari Brothers Coal Limited - India
- Altura Mining Limited, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- The Treasury - Australian Government
- PTC India Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Maharashtra Electricity Regulatory Commission - India
- Global Green Power PLC Corporation, Philippines
- Deloitte Consulting - India
- Rashtriya Ispat Nigam Limited - India
- Vedanta Resources Plc - India
- Chamber of Mines of South Africa
- Samtan Co., Ltd - South Korea
- CIMB Investment Bank - Malaysia
- Kideco Jaya Agung - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Carbofer General Trading SA - India
- Kalimantan Lumbung Energi - Indonesia
- Bangladesh Power Developement Board
- Baramulti Group, Indonesia
- Savvy Resources Ltd - HongKong
- Renaissance Capital - South Africa
- Riau Bara Harum - Indonesia
- Kaltim Prima Coal - Indonesia
- CNBM International Corporation - China
- Central Electricity Authority - India
- Siam City Cement PLC, Thailand
- Neyveli Lignite Corporation Ltd, - India
- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- Sinarmas Energy and Mining - Indonesia
- Indogreen Group - Indonesia
- Borneo Indobara - Indonesia
- International Coal Ventures Pvt Ltd - India
- Standard Chartered Bank - UAE
- Indo Tambangraya Megah - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- Electricity Generating Authority of Thailand
- Ministry of Finance - Indonesia
- Globalindo Alam Lestari - Indonesia
- Eastern Energy - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- TeaM Sual Corporation - Philippines
- Merrill Lynch Commodities Europe
- Kepco SPC Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Thiess Contractors Indonesia
- Mercator Lines Limited - India
- Makarim & Taira - Indonesia
- Ambuja Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- The State Trading Corporation of India Ltd
- Parry Sugars Refinery, India
- Interocean Group of Companies - India
- Global Coal Blending Company Limited - Australia
- Wood Mackenzie - Singapore
- Mercuria Energy - Indonesia
- Uttam Galva Steels Limited - India
- ICICI Bank Limited - India
- Dalmia Cement Bharat India
- Minerals Council of Australia
- Bhoruka Overseas - Indonesia
- Bukit Baiduri Energy - Indonesia
- Oldendorff Carriers - Singapore
- Economic Council, Georgia
- Energy Development Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Semirara Mining Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Australian Commodity Traders Exchange
- Orica Mining Services - Indonesia
- Banpu Public Company Limited - Thailand
- Ministry of Transport, Egypt
- Parliament of New Zealand
- SMG Consultants - Indonesia
- Indian Energy Exchange, India
- Energy Link Ltd, New Zealand
- Coastal Gujarat Power Limited - India
- Power Finance Corporation Ltd., India
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