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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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Wednesday, 27 April 11
DRY BULK MARKET LACKS ACTIVITY, RATES KEEP RETREATING - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the Easter Holidays for a large of the world now behind, the dry bulk market kept lacking activity on Tuesday, which led the Baltic Dry Index ( ...
Tuesday, 26 April 11
NTPC CALLS TENDER FOR 4 MLN TON OF NON-COKING COAL
COALspot.com - NTPC Limited, incorporated in 1975 as a public sector company wholly owned by Government of India, is the largest thermal power gener ...
Monday, 25 April 11
THE FUTURES FOR THREE YEARS WAS AT AROUND PANAMAX/US$ 14,000 PER DAY & SUPRAMAX/US$ 14,000 PER DAY - VISTAAR
COALspot.com - The freight market continued to soften further with all segments down except for the handy size which was marginally up by 10 points. ...
Saturday, 23 April 11
GUPTA COAL TO BAG ONE MILLION TONS OF COAL SUPPLY ORDER FROM KPCL AT AROUND US$ 127.53 PMT
COALspot.com - Karnataka Power Corporation (KPCL), a state utility of Karnataka, India has secured its one million tons of thermal coal with c ...
Saturday, 23 April 11
STRAITS ASIA SETS 11.5 MIO TONS OUTPUT - INSIDER STORIES
Insider Stories reported that, Singapore-listed Straits Asia Resources Limited plans to jack up its coal output target of 8.5% to 11.5 million tons ...
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- Meralco Power Generation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Indo Tambangraya Megah - Indonesia
- Electricity Authority, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- CNBM International Corporation - China
- Kepco SPC Power Corporation, Philippines
- Singapore Mercantile Exchange
- Port Waratah Coal Services - Australia
- Toyota Tsusho Corporation, Japan
- Barasentosa Lestari - Indonesia
- Rio Tinto Coal - Australia
- Ministry of Transport, Egypt
- Oldendorff Carriers - Singapore
- Trasteel International SA, Italy
- Makarim & Taira - Indonesia
- ICICI Bank Limited - India
- Globalindo Alam Lestari - Indonesia
- Indonesian Coal Mining Association
- Dalmia Cement Bharat India
- Intertek Mineral Services - Indonesia
- Parliament of New Zealand
- Altura Mining Limited, Indonesia
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- Wilmar Investment Holdings
- PTC India Limited - India
- The Treasury - Australian Government
- Bukit Makmur.PT - Indonesia
- Tamil Nadu electricity Board
- Attock Cement Pakistan Limited
- CIMB Investment Bank - Malaysia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indian Energy Exchange, India
- Siam City Cement - Thailand
- Sical Logistics Limited - India
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Alfred C Toepfer International GmbH - Germany
- Rashtriya Ispat Nigam Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Maharashtra Electricity Regulatory Commission - India
- The University of Queensland
- Bahari Cakrawala Sebuku - Indonesia
- SMG Consultants - Indonesia
- Global Business Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Kideco Jaya Agung - Indonesia
- Essar Steel Hazira Ltd - India
- Xindia Steels Limited - India
- Economic Council, Georgia
- Ministry of Mines - Canada
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Marubeni Corporation - India
- Energy Link Ltd, New Zealand
- Parry Sugars Refinery, India
- Carbofer General Trading SA - India
- India Bulls Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Agrawal Coal Company - India
- Sindya Power Generating Company Private Ltd
- Samtan Co., Ltd - South Korea
- Simpson Spence & Young - Indonesia
- Sakthi Sugars Limited - India
- Ambuja Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Mintek Dendrill Indonesia
- IEA Clean Coal Centre - UK
- Edison Trading Spa - Italy
- Georgia Ports Authority, United States
- Latin American Coal - Colombia
- TNB Fuel Sdn Bhd - Malaysia
- Bhatia International Limited - India
- Ministry of Finance - Indonesia
- Eastern Coal Council - USA
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- GVK Power & Infra Limited - India
- The State Trading Corporation of India Ltd
- Asmin Koalindo Tuhup - Indonesia
- TeaM Sual Corporation - Philippines
- Star Paper Mills Limited - India
- Savvy Resources Ltd - HongKong
- Chettinad Cement Corporation Ltd - India
- GMR Energy Limited - India
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- Gujarat Sidhee Cement - India
- Wood Mackenzie - Singapore
- Bharathi Cement Corporation - India
- Anglo American - United Kingdom
- Offshore Bulk Terminal Pte Ltd, Singapore
- PetroVietnam Power Coal Import and Supply Company
- Ind-Barath Power Infra Limited - India
- Energy Development Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Bhushan Steel Limited - India
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- Cement Manufacturers Association - India
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Bhoruka Overseas - Indonesia
- Central Electricity Authority - India
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Australian Commodity Traders Exchange
- Maheswari Brothers Coal Limited - India
- Banpu Public Company Limited - Thailand
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Planning Commission, India
- Chamber of Mines of South Africa
- South Luzon Thermal Energy Corporation
- Formosa Plastics Group - Taiwan
- Interocean Group of Companies - India
- Petrochimia International Co. Ltd.- Taiwan
- Karbindo Abesyapradhi - Indoneisa
- New Zealand Coal & Carbon
- Aditya Birla Group - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tata Chemicals Ltd - India
- VISA Power Limited - India
- Price Waterhouse Coopers - Russia
- Mjunction Services Limited - India
- Leighton Contractors Pty Ltd - Australia
- Kapuas Tunggal Persada - Indonesia
- Directorate Of Revenue Intelligence - India
- IHS Mccloskey Coal Group - USA
- Grasim Industreis Ltd - India
- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Iligan Light & Power Inc, Philippines
- Uttam Galva Steels Limited - India
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
- Bayan Resources Tbk. - Indonesia
- Eastern Energy - Thailand
- ASAPP Information Group - India
- Therma Luzon, Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Indogreen Group - Indonesia
- Madhucon Powers Ltd - India
- Kobexindo Tractors - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- Jaiprakash Power Ventures ltd
- Mercuria Energy - Indonesia
- Kaltim Prima Coal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Minerals Council of Australia
- Siam City Cement PLC, Thailand
- GAC Shipping (India) Pvt Ltd
- Power Finance Corporation Ltd., India
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Meenaskhi Energy Private Limited - India
- Miang Besar Coal Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Thiess Contractors Indonesia
- Videocon Industries ltd - India
- Jindal Steel & Power Ltd - India
- Lanco Infratech Ltd - India
- McConnell Dowell - Australia
- Gujarat Electricity Regulatory Commission - India
- Bukit Baiduri Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Orica Mining Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Independent Power Producers Association of India
- Borneo Indobara - Indonesia
- Coastal Gujarat Power Limited - India
- LBH Netherlands Bv - Netherlands
- Metalloyd Limited - United Kingdom
- London Commodity Brokers - England
- Posco Energy - South Korea
- Bangladesh Power Developement Board
- Larsen & Toubro Limited - India
- Aboitiz Power Corporation - Philippines
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- PNOC Exploration Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Heidelberg Cement - Germany
- Thai Mozambique Logistica
- Gujarat Mineral Development Corp Ltd - India
- White Energy Company Limited
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vizag Seaport Private Limited - India
- Mercator Lines Limited - India
- Australian Coal Association
- AsiaOL BioFuels Corp., Philippines
- Sree Jayajothi Cements Limited - India
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Standard Chartered Bank - UAE
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Petron Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Ceylon Electricity Board - Sri Lanka
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