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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, 05 April 11
DRY BULK MARKET DOWN ON FIRST DAY OF SECOND QUARTER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market began the second quarter on a downward pattern, with the industry’s benchmark, the Baltic Dry Index (BDI) shedding 1.45 pe ...
Monday, 04 April 11
INDONESIA INTERNATIONAL CONFERENCE FOCUS ON INDONESIA'S ECONOMY (IICFIE) 2011 MASTER PLAN TO ACCELERATE THE ECONOMIC DEVELOPMENT
Press Release - Since couple of years, Indonesia's economy show impressive growth. What is the Indonesia's Economic Corridor and the Master plan t ...
Saturday, 02 April 11
TNPL CALLS FOR 160KT OF NON-COKING COAL
COALspot.com - Tamil Nadu Newsprint and Papers Limited (TNPL), is seeking to procure another 160,000 MT +/- 5 percent of Non-Coking imported C ...
Saturday, 02 April 11
THE FREIGHT MARKETS LIKELY TO BE SOFT NEXT WEEK - VISTAAR SINGAPORE
COALspot.com - The freight market softened this week affecting all sectors with BDI down by 65 points (down by 4.10 pct) and closed at 1,520 points. ...
Friday, 01 April 11
SUPRAS EX RICHARDS BAY COAL TERMINAL TO INDIA HOVERING AT $ 25 - 27.00 PMT - FEARNBULK
Handy
Atlantic markets remain stable with more activity from the Black Sea to FEast paying in the mid 20´s on Supras. The USG remains firm p ...
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- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Mines - Canada
- The Treasury - Australian Government
- Planning Commission, India
- Mercator Lines Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- Australian Coal Association
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- Ind-Barath Power Infra Limited - India
- Altura Mining Limited, Indonesia
- Bharathi Cement Corporation - India
- Kobexindo Tractors - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vedanta Resources Plc - India
- Mjunction Services Limited - India
- Lanco Infratech Ltd - India
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Leighton Contractors Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- Manunggal Multi Energi - Indonesia
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- Medco Energi Mining Internasional
- Energy Development Corp, Philippines
- Borneo Indobara - Indonesia
- PTC India Limited - India
- Port Waratah Coal Services - Australia
- Rio Tinto Coal - Australia
- Sinarmas Energy and Mining - Indonesia
- London Commodity Brokers - England
- Independent Power Producers Association of India
- Thai Mozambique Logistica
- Goldman Sachs - Singapore
- Parliament of New Zealand
- CIMB Investment Bank - Malaysia
- Toyota Tsusho Corporation, Japan
- Directorate Of Revenue Intelligence - India
- Maheswari Brothers Coal Limited - India
- Kartika Selabumi Mining - Indonesia
- Chamber of Mines of South Africa
- European Bulk Services B.V. - Netherlands
- Coastal Gujarat Power Limited - India
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bayan Resources Tbk. - Indonesia
- Africa Commodities Group - South Africa
- Eastern Energy - Thailand
- Simpson Spence & Young - Indonesia
- IEA Clean Coal Centre - UK
- Australian Commodity Traders Exchange
- ASAPP Information Group - India
- Sakthi Sugars Limited - India
- Savvy Resources Ltd - HongKong
- Cement Manufacturers Association - India
- Jaiprakash Power Ventures ltd
- Straits Asia Resources Limited - Singapore
- Tata Chemicals Ltd - India
- Vizag Seaport Private Limited - India
- Alfred C Toepfer International GmbH - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Agrawal Coal Company - India
- Billiton Holdings Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Holcim Trading Pte Ltd - Singapore
- White Energy Company Limited
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Deloitte Consulting - India
- Indogreen Group - Indonesia
- PNOC Exploration Corporation - Philippines
- Mintek Dendrill Indonesia
- Latin American Coal - Colombia
- Renaissance Capital - South Africa
- The State Trading Corporation of India Ltd
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- TeaM Sual Corporation - Philippines
- Standard Chartered Bank - UAE
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Economic Council, Georgia
- GVK Power & Infra Limited - India
- Essar Steel Hazira Ltd - India
- SMG Consultants - Indonesia
- Makarim & Taira - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Indika Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Price Waterhouse Coopers - Russia
- Cigading International Bulk Terminal - Indonesia
- McConnell Dowell - Australia
- Globalindo Alam Lestari - Indonesia
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- Global Business Power Corporation, Philippines
- Eastern Coal Council - USA
- Carbofer General Trading SA - India
- Wilmar Investment Holdings
- Bhatia International Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Jindal Steel & Power Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- SN Aboitiz Power Inc, Philippines
- The University of Queensland
- MS Steel International - UAE
- Sojitz Corporation - Japan
- Aboitiz Power Corporation - Philippines
- Global Coal Blending Company Limited - Australia
- Directorate General of MIneral and Coal - Indonesia
- SMC Global Power, Philippines
- Larsen & Toubro Limited - India
- Kapuas Tunggal Persada - Indonesia
- Videocon Industries ltd - India
- Kepco SPC Power Corporation, Philippines
- Posco Energy - South Korea
- Merrill Lynch Commodities Europe
- Romanian Commodities Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- International Coal Ventures Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- CNBM International Corporation - China
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- Tamil Nadu electricity Board
- Orica Australia Pty. Ltd.
- Madhucon Powers Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bhoruka Overseas - Indonesia
- Sical Logistics Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- San Jose City I Power Corp, Philippines
- Oldendorff Carriers - Singapore
- Kaltim Prima Coal - Indonesia
- Riau Bara Harum - Indonesia
- Bhushan Steel Limited - India
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- Siam City Cement - Thailand
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Formosa Plastics Group - Taiwan
- Pendopo Energi Batubara - Indonesia
- Meenaskhi Energy Private Limited - India
- New Zealand Coal & Carbon
- Marubeni Corporation - India
- Mercuria Energy - Indonesia
- Indian Oil Corporation Limited
- Parry Sugars Refinery, India
- OPG Power Generation Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Sarangani Energy Corporation, Philippines
- Electricity Authority, New Zealand
- Bangladesh Power Developement Board
- LBH Netherlands Bv - Netherlands
- IHS Mccloskey Coal Group - USA
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- Iligan Light & Power Inc, Philippines
- Indian Energy Exchange, India
- Heidelberg Cement - Germany
- Meralco Power Generation, Philippines
- Coal and Oil Company - UAE
- Kumho Petrochemical, South Korea
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- Malabar Cements Ltd - India
- Intertek Mineral Services - Indonesia
- Antam Resourcindo - Indonesia
- Minerals Council of Australia
- Edison Trading Spa - Italy
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- Gujarat Sidhee Cement - India
- Anglo American - United Kingdom
- South Luzon Thermal Energy Corporation
- Miang Besar Coal Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- ICICI Bank Limited - India
- Semirara Mining Corp, Philippines
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Ministry of Finance - Indonesia
- Attock Cement Pakistan Limited
- India Bulls Power Limited - India
- Metalloyd Limited - United Kingdom
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- Semirara Mining and Power Corporation, Philippines
- Baramulti Group, Indonesia
- Ceylon Electricity Board - Sri Lanka
- Barasentosa Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Georgia Ports Authority, United States
- Samtan Co., Ltd - South Korea
- Bukit Baiduri Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ministry of Transport, Egypt
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