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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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Tuesday, 19 April 11
LONDON COMMODITY BROKERS OPENS JOHANNESBURG OFFICE
COALspot.com - London Commodity Brokers (LCB), a broking house specialising in bulk physical and Over-The-Counter commodities and options (coal ...
Tuesday, 19 April 11
TNPL TO CONDUCT E-AUCTION TO SECURE 160,000 MT OF COAL
COALspot.com - Tamil Nadu Newsprint and Papers Limited (TNPL) a state utility of Tamil Nadu, India to conduct reverse auction on 20 April 2011, betw ...
Tuesday, 19 April 11
ADARO TO ALLOT US$100 MIO FOR COKING COAL - INSIDER STORIES
One of Indonesia's largest coal miner PT Adaro Energy Tbk (ADRO) plans to spend US$100 million in coking coal project dubbed IndoMet Coal, a joint ...
Tuesday, 19 April 11
KPCL TO OPEN PRICE BID ON 23 APRIL 2011 TO FINALIZE ITS ONE MILLION MT COAL SUPPLIER
COALspot.com - Karnataka Power Corporation (KPCL) a state utility of Karnataka, India called for open tender for supply of one million tons of 6300 ...
Monday, 18 April 11
INDONESIA HAS SET THE APRIL 2011 COAL REFERENCE PRICE FOR THERMAL COAL AT US$ 122.02 PER TON
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia has set the April 2011 Indonesian Coal Reference Price for thermal coal at ...
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- Directorate General of MIneral and Coal - Indonesia
- Planning Commission, India
- White Energy Company Limited
- Gujarat Sidhee Cement - India
- Economic Council, Georgia
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
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- Central Java Power - Indonesia
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- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
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- Coal and Oil Company - UAE
- Kumho Petrochemical, South Korea
- Commonwealth Bank - Australia
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- Aditya Birla Group - India
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- Coalindo Energy - Indonesia
- Ministry of Finance - Indonesia
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- Siam City Cement - Thailand
- Romanian Commodities Exchange
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- Edison Trading Spa - Italy
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- Australian Commodity Traders Exchange
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- Eastern Energy - Thailand
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- Star Paper Mills Limited - India
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- Indonesian Coal Mining Association
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- TeaM Sual Corporation - Philippines
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- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Savvy Resources Ltd - HongKong
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- Eastern Coal Council - USA
- Wood Mackenzie - Singapore
- Bayan Resources Tbk. - Indonesia
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- Bhushan Steel Limited - India
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- PowerSource Philippines DevCo
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Ambuja Cements Ltd - India
- Straits Asia Resources Limited - Singapore
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- McConnell Dowell - Australia
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Port Waratah Coal Services - Australia
- Bhatia International Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- Rio Tinto Coal - Australia
- Dalmia Cement Bharat India
- Barasentosa Lestari - Indonesia
- Independent Power Producers Association of India
- Energy Link Ltd, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Antam Resourcindo - Indonesia
- Bulk Trading Sa - Switzerland
- Intertek Mineral Services - Indonesia
- Coastal Gujarat Power Limited - India
- Indian Oil Corporation Limited
- Larsen & Toubro Limited - India
- Posco Energy - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- ASAPP Information Group - India
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
- Maheswari Brothers Coal Limited - India
- MS Steel International - UAE
- Bhoruka Overseas - Indonesia
- Mjunction Services Limited - India
- Sarangani Energy Corporation, Philippines
- Central Electricity Authority - India
- Latin American Coal - Colombia
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- Trasteel International SA, Italy
- India Bulls Power Limited - India
- Altura Mining Limited, Indonesia
- OPG Power Generation Pvt Ltd - India
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- Indian Energy Exchange, India
- Thiess Contractors Indonesia
- Ministry of Mines - Canada
- Global Coal Blending Company Limited - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Electricity Generating Authority of Thailand
- Parry Sugars Refinery, India
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Indogreen Group - Indonesia
- Petron Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Authority, New Zealand
- PTC India Limited - India
- Marubeni Corporation - India
- Timah Investasi Mineral - Indoneisa
- Indika Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
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- Grasim Industreis Ltd - India
- Samtan Co., Ltd - South Korea
- Energy Development Corp, Philippines
- VISA Power Limited - India
- IHS Mccloskey Coal Group - USA
- The State Trading Corporation of India Ltd
- Salva Resources Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- CIMB Investment Bank - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Africa Commodities Group - South Africa
- Semirara Mining and Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Semirara Mining Corp, Philippines
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- Kohat Cement Company Ltd. - Pakistan
- Therma Luzon, Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Orica Australia Pty. Ltd.
- Ceylon Electricity Board - Sri Lanka
- Price Waterhouse Coopers - Russia
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- Essar Steel Hazira Ltd - India
- SN Aboitiz Power Inc, Philippines
- The Treasury - Australian Government
- Sojitz Corporation - Japan
- Vedanta Resources Plc - India
- Bharathi Cement Corporation - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Orica Mining Services - Indonesia
- Mercuria Energy - Indonesia
- London Commodity Brokers - England
- Anglo American - United Kingdom
- South Luzon Thermal Energy Corporation
- Bangladesh Power Developement Board
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Medco Energi Mining Internasional
- New Zealand Coal & Carbon
- Bank of Tokyo Mitsubishi UFJ Ltd
- Deloitte Consulting - India
- Thai Mozambique Logistica
- Gujarat Mineral Development Corp Ltd - India
- Borneo Indobara - Indonesia
- Attock Cement Pakistan Limited
- Binh Thuan Hamico - Vietnam
- Aboitiz Power Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Heidelberg Cement - Germany
- Kepco SPC Power Corporation, Philippines
- Mercator Lines Limited - India
- Wilmar Investment Holdings
- Xindia Steels Limited - India
- Sinarmas Energy and Mining - Indonesia
- IEA Clean Coal Centre - UK
- Jaiprakash Power Ventures ltd
- Parliament of New Zealand
- European Bulk Services B.V. - Netherlands
- Agrawal Coal Company - India
- Singapore Mercantile Exchange
- Sindya Power Generating Company Private Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Global Business Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Bukit Makmur.PT - Indonesia
- Oldendorff Carriers - Singapore
- Kartika Selabumi Mining - Indonesia
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- Georgia Ports Authority, United States
- SMC Global Power, Philippines
- Lanco Infratech Ltd - India
- Kaltim Prima Coal - Indonesia
- Chamber of Mines of South Africa
- The University of Queensland
- Globalindo Alam Lestari - Indonesia
- Australian Coal Association
- Sical Logistics Limited - India
- Tamil Nadu electricity Board
- Global Green Power PLC Corporation, Philippines
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