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Wednesday, 13 April 11
CAPESIZE VESSELS ARE DELIVERED AT A PACE OF ONE NEW VESSEL EVERY SECOND DAY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 In a clear sign that it will take a significant rise in global seaborne dry bulk trade in order to be able to absorb the flurry of new building tonnage thrown into the water, BIMCO has issued a new report, saying, among others, that at the moment Capesize vessels are delivered at a rate of one new vessel every second day. On top of that, 6 VLOC’s have been launched with another 35 potentially up for delivery in 2011 (adjusted for slippage). The report also said that the active fleet has grown by 2.7% so far in 2011, caused by deliveries of 222 newbuilt vessels with an average cargo capacity of 85,000 DWT offset by 67 vessels with a total capacity of 4.8 million DWT being demolished.
On the positive side, “like in the tanker segments, demolition finally, but still surprisingly, has kicked off strongly – positively impacted by the high scrap steel prices. A 25 year-old large Capesize demolition was worth almost USD 11 million. However, the level of demolishing is still considerably below a level that could balance supply and demand and impact the freight markets positively” said the report by BIMCO’s shipping analyst, Peter Sand. “BIMCO forecasts inflow of new dry bulk tonnage in 2011 to be a bit higher than in 2010 at 86 million DWT. As demolitions are expected to reach 12 million DWT, the fleet is forecast to grow by 13.8% in 2011. Newbuilding contracts are being signed at the slowest pace since Q2 in 2009. This is a very positive development, especially seen in the light of the unbelievable high contracting level in 2010 with 78 million DWT of new contracts” said the report.
In terms of the dry bulk market’s outlook, BIMCO said that “the events in Japan, will, in the short term, be a negative story for the dry bulk market as expected high volumes into Japan will be some 10-20 million tons lower, as coal power plants and steel mills have be shut down for a while and some are expected to be so for up to 1 year. In the medium to long term, dry bulk is likely to benefit as reconstruction takes off. Iron ore, coking coal, thermal coal and wood for construction are likely to be in higher demand following the disasters. Unlike Australia, which was a supply story, Japan is mainly about demand falling short – the impact on the freight market has been insignificant as compared to the flooding in Queensland.
BIMCO assesses that Capesize freight rates will remain in depressed territory in the coming months. Capesize Time Charter Average is likely to hover around USD 10,000–15,000 per day and backhaul trip charter earnings likely to continue to make negative returns.
The Capesize fleet has already grown 4.5% this year and overcapacity in the segment will stay a drag on freight rates each time they try to escape the doldrums. Supramax and Panamax are likely to stay firm in the USD 15,000–USD 20,000 per day interval as demand supports this level. Overall, dry bulk commodity demand growth is expected to be around 7-8% in 2011, with iron ore and coal as usual in the driving seat. This outlook provides a solid demand picture to comfort and fence a collapse of earnings, as oversupply is haunting all segments” said the report.
For the time being though, since early January, Capesize time charter rates have been below all the other segments including Handysize. While the 3 smaller segments have rebounded since then, Capesize is still down. “Current average of 4 time-charter routes is USD 10,371 per day. For comparison – a Handysize makes USD 11,849 per day, a Supramax USD 15,921 per day and a Panamax USD 15,807 per day. Spot rates on main Capesize iron ore trades from Brazil and Australia, which are the top two suppliers to the Chinese steel industry, look as if they have bottomed out during January and February. This year’s unfolding story in relation to iron ore trades will be the scheduled delivery of the first 6 out of 19 400,000 DWT VLOC’s to the Brazilian miner, Vale. This is expected to impact the market, as Vale is a large charterer of Capesize tonnage to service its Asian customers. In 2010, Vale exported 131 million tons to China. Estimating 6 round voyage a year, the 6 new build VLOC’s will be able to carry 14.4 million tonnes of iron ore p.a., equal to 11% of Vale exports to China. With another 13 to be delivered over the next 2-3 years, Vale will depend much less on the Capesize chartering market – as it will be self-sufficient in 25-30% of its tonnage demand. The vessels are intended to bring down Vale’s price disadvantage to the Australian iron ore by taking out the longhaul maritime transportation cost element. The spot rates are on average 2½ times higher on Brazilian ore, being a close mirror of the difference in distance.
It remains uncertain where Vale is going to establish its Asian iron ore distribution centre. First Qingdao was targeted, but failed to become a done deal. Lately Vale has focused on a Malaysian distribution hub, but another site remains an option, the Tianjin Dongjiang Free Trade Port Zone near Beijing – a new giant port and logistics centre. The final location will be vital to the success of VLOC’s.
Seaborne Iron ore demand is expected to grow by 7% overall, where China will take the most and European demand will increase to a precrisis level.
Also recently, the commodities trader Cargill has decided to become a ship owner once again, this time round mainly with the purpose of being an asset player. This adds to the number of large charterers making an entry into ship owning primarily with the object of controlling a larger part of the supply chain and converting variable costs to fixed costs.
The demand for taking Capesize vessels on time charter is on a par with last year. Time charter rates are currently higher than spot freight rates, which indicates an extraordinarily weak spot market. Representative deals that support the rather flat medium term expectation in the market are, amongst others, Cargill taking the “Semirio”, 174,000 DWT for two years at USD 17,000 per day and Rio Tinto taking “Bulk India”, 177,000 DWT for one year at USD 16,500 per day”, concluded BIMCO’s analysis
Source: Nikos Roussanoglou, Hellenic Shipping
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Friday, 03 June 11
DRY BULK MARKETS RESURGENCE APPEARS TO BE LOSING SOME STEAM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market’s seems to be losing some steam, despite reports of growing Chinese demand for commodities, especially coal, on the back o ...
Thursday, 02 June 11
LARGE SUPRAS FOR RBCT/INDIA ROUND ARE NOW ASKING 14K - FEARNBULK
Handy
The Handy/Supra market has in general been flat and un-exciting this week. The Black Sea market is almost non existing while the US Gulf mar ...
Thursday, 02 June 11
DRY BULK SHIP OWNERS LOOKING INTO SHORTENED WEEK WITH ANXIETY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With most markets in the western world closed yesterday, as a result of Memorial Day, dry bulk stakeholders weren’t able to build over the pos ...
Monday, 30 May 11
MIANG BESAR COAL TERMINAL ON TARGET
COALspot.com - MBCT, to be largest coal terminal in Asia to start construction in Indonesia’s east Kalimantan Island in July 2011 says Mr. Joh ...
Sunday, 29 May 11
THE FREIGHT MARKET CONTINUED TO GAIN MOMENTUM - VISTAAR
COALspot.com - The freight market continued to gain momentum and the BDI, Cape Index and Panamax was by up almost 10-12 pct and on all sectors, Vist ...
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- Meenaskhi Energy Private Limited - India
- Xindia Steels Limited - India
- Agrawal Coal Company - India
- Bahari Cakrawala Sebuku - Indonesia
- Price Waterhouse Coopers - Russia
- Altura Mining Limited, Indonesia
- Kepco SPC Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Parliament of New Zealand
- Ind-Barath Power Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Cigading International Bulk Terminal - Indonesia
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- CIMB Investment Bank - Malaysia
- Kumho Petrochemical, South Korea
- San Jose City I Power Corp, Philippines
- Sarangani Energy Corporation, Philippines
- GVK Power & Infra Limited - India
- Australian Commodity Traders Exchange
- Wood Mackenzie - Singapore
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Malabar Cements Ltd - India
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- Makarim & Taira - Indonesia
- Pendopo Energi Batubara - Indonesia
- Medco Energi Mining Internasional
- New Zealand Coal & Carbon
- IHS Mccloskey Coal Group - USA
- Bukit Makmur.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Madhucon Powers Ltd - India
- PowerSource Philippines DevCo
- Jaiprakash Power Ventures ltd
- Wilmar Investment Holdings
- Ministry of Mines - Canada
- Central Electricity Authority - India
- Sical Logistics Limited - India
- Ambuja Cements Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Bhatia International Limited - India
- Deloitte Consulting - India
- Bhushan Steel Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Transport, Egypt
- Merrill Lynch Commodities Europe
- Mercuria Energy - Indonesia
- Semirara Mining Corp, Philippines
- Siam City Cement PLC, Thailand
- Vizag Seaport Private Limited - India
- Independent Power Producers Association of India
- Timah Investasi Mineral - Indoneisa
- Kobexindo Tractors - Indoneisa
- Binh Thuan Hamico - Vietnam
- PNOC Exploration Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- Indian Oil Corporation Limited
- Mjunction Services Limited - India
- White Energy Company Limited
- LBH Netherlands Bv - Netherlands
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- McConnell Dowell - Australia
- Directorate Of Revenue Intelligence - India
- Indika Energy - Indonesia
- Mercator Lines Limited - India
- IEA Clean Coal Centre - UK
- Bulk Trading Sa - Switzerland
- Baramulti Group, Indonesia
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Economic Council, Georgia
- Riau Bara Harum - Indonesia
- The State Trading Corporation of India Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Coalindo Energy - Indonesia
- Sojitz Corporation - Japan
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Minerals Council of Australia
- Karaikal Port Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Siam City Cement - Thailand
- Goldman Sachs - Singapore
- Energy Development Corp, Philippines
- Videocon Industries ltd - India
- Posco Energy - South Korea
- Commonwealth Bank - Australia
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- European Bulk Services B.V. - Netherlands
- Manunggal Multi Energi - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMC Global Power, Philippines
- Krishnapatnam Port Company Ltd. - India
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Grasim Industreis Ltd - India
- Borneo Indobara - Indonesia
- Kideco Jaya Agung - Indonesia
- Uttam Galva Steels Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- Marubeni Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- Tata Chemicals Ltd - India
- Oldendorff Carriers - Singapore
- London Commodity Brokers - England
- Mintek Dendrill Indonesia
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Parry Sugars Refinery, India
- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Power Finance Corporation Ltd., India
- Directorate General of MIneral and Coal - Indonesia
- Chamber of Mines of South Africa
- Anglo American - United Kingdom
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Latin American Coal - Colombia
- Sinarmas Energy and Mining - Indonesia
- Standard Chartered Bank - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Georgia Ports Authority, United States
- Indo Tambangraya Megah - Indonesia
- Singapore Mercantile Exchange
- Bangladesh Power Developement Board
- Salva Resources Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Sidhee Cement - India
- Carbofer General Trading SA - India
- Sree Jayajothi Cements Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Interocean Group of Companies - India
- TeaM Sual Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Planning Commission, India
- Ministry of Finance - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Banpu Public Company Limited - Thailand
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- OPG Power Generation Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Asmin Koalindo Tuhup - Indonesia
- ICICI Bank Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- Straits Asia Resources Limited - Singapore
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- India Bulls Power Limited - India
- Antam Resourcindo - Indonesia
- Metalloyd Limited - United Kingdom
- Vedanta Resources Plc - India
- AsiaOL BioFuels Corp., Philippines
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Rashtriya Ispat Nigam Limited - India
- Renaissance Capital - South Africa
- Global Green Power PLC Corporation, Philippines
- Electricity Authority, New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Indonesian Coal Mining Association
- Attock Cement Pakistan Limited
- Therma Luzon, Inc, Philippines
- Orica Mining Services - Indonesia
- Toyota Tsusho Corporation, Japan
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- Thiess Contractors Indonesia
- Global Business Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- Aditya Birla Group - India
- Leighton Contractors Pty Ltd - Australia
- Meralco Power Generation, Philippines
- The Treasury - Australian Government
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Samtan Co., Ltd - South Korea
- Star Paper Mills Limited - India
- VISA Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- Thai Mozambique Logistica
- Bukit Asam (Persero) Tbk - Indonesia
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Bhoruka Overseas - Indonesia
- Edison Trading Spa - Italy
- Neyveli Lignite Corporation Ltd, - India
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