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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, 08 March 11
US$ 8 BILLION WORTH OF INFRASTRUCTURE PROJECTS IN PIPELINE IN INDONESIA - WOOD MACKENZIE
India’s Increasing Demand for Thermal Coal Cannot Be Satisfied Without Emerging Coal Areas in Indonesia - Wood Mackenzie
At Coa ...
Tuesday, 08 March 11
INDIA'S VEDANTA TO ACQUIRE COAL MINES IN OVERSEAS
COALspot.com - India's Vedanta group is also looking at long-term off take agreements and possible acquire of coal mines overseas, the official sai ...
Tuesday, 08 March 11
MINERS SAY VALUE-ADDED LAW WILL HURT IN THE LONG RUN - THE JAKARTA GLOBE
The Jakarta Globe reported that, Government plans to require miners to give added value to their exported commodities could end up costing the count ...
Tuesday, 08 March 11
THE PANAMAX MARKET THIS WEEK FIRMED UP - BRS
Underlining the unpredictability of the current market, rates for all dry bulk segments swung up again last week. Stronger exports out of South Amer ...
Sunday, 06 March 11
THE S6 ROUTE MAY CONTINUE TO BE FIRM - VISTAAR
COALspot.com - The freight market was firm this week with all indices up. The BDI , Cape Index and Panamax index was up by almost 9 pct where as Sup ...
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- TeaM Sual Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Kobexindo Tractors - Indoneisa
- Interocean Group of Companies - India
- Indonesian Coal Mining Association
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Riau Bara Harum - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Finance - Indonesia
- Thai Mozambique Logistica
- PTC India Limited - India
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- Kumho Petrochemical, South Korea
- The Treasury - Australian Government
- Petrochimia International Co. Ltd.- Taiwan
- Kaltim Prima Coal - Indonesia
- Petron Corporation, Philippines
- Energy Development Corp, Philippines
- Attock Cement Pakistan Limited
- Latin American Coal - Colombia
- Salva Resources Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Barasentosa Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Wood Mackenzie - Singapore
- Binh Thuan Hamico - Vietnam
- Georgia Ports Authority, United States
- Pendopo Energi Batubara - Indonesia
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Ministry of Mines - Canada
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- SMC Global Power, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Gujarat Sidhee Cement - India
- Goldman Sachs - Singapore
- Bukit Makmur.PT - Indonesia
- Borneo Indobara - Indonesia
- Altura Mining Limited, Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bangladesh Power Developement Board
- McConnell Dowell - Australia
- Timah Investasi Mineral - Indoneisa
- GVK Power & Infra Limited - India
- Manunggal Multi Energi - Indonesia
- Tamil Nadu electricity Board
- Parry Sugars Refinery, India
- Therma Luzon, Inc, Philippines
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- Carbofer General Trading SA - India
- India Bulls Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sindya Power Generating Company Private Ltd
- Orica Mining Services - Indonesia
- Lanco Infratech Ltd - India
- LBH Netherlands Bv - Netherlands
- Mercator Lines Limited - India
- Bhatia International Limited - India
- Mjunction Services Limited - India
- GMR Energy Limited - India
- Posco Energy - South Korea
- Parliament of New Zealand
- Romanian Commodities Exchange
- Port Waratah Coal Services - Australia
- Uttam Galva Steels Limited - India
- Tata Chemicals Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Coal and Oil Company - UAE
- Edison Trading Spa - Italy
- Indogreen Group - Indonesia
- Siam City Cement - Thailand
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- Samtan Co., Ltd - South Korea
- Vizag Seaport Private Limited - India
- Central Electricity Authority - India
- Aditya Birla Group - India
- Sical Logistics Limited - India
- Ambuja Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- OPG Power Generation Pvt Ltd - India
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Meralco Power Generation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Independent Power Producers Association of India
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Electricity Authority, New Zealand
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- South Luzon Thermal Energy Corporation
- Jindal Steel & Power Ltd - India
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- IHS Mccloskey Coal Group - USA
- Grasim Industreis Ltd - India
- Bukit Baiduri Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Singapore Mercantile Exchange
- Heidelberg Cement - Germany
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- Banpu Public Company Limited - Thailand
- Billiton Holdings Pty Ltd - Australia
- Leighton Contractors Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Electricity Regulatory Commission - India
- CNBM International Corporation - China
- Neyveli Lignite Corporation Ltd, - India
- Bhoruka Overseas - Indonesia
- Malabar Cements Ltd - India
- Indian Energy Exchange, India
- Anglo American - United Kingdom
- Bulk Trading Sa - Switzerland
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Cement Manufacturers Association - India
- Commonwealth Bank - Australia
- IEA Clean Coal Centre - UK
- Coastal Gujarat Power Limited - India
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- PNOC Exploration Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Sinarmas Energy and Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Renaissance Capital - South Africa
- Straits Asia Resources Limited - Singapore
- Mercuria Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- PowerSource Philippines DevCo
- London Commodity Brokers - England
- International Coal Ventures Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Mintek Dendrill Indonesia
- Eastern Coal Council - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Java Power - Indonesia
- Iligan Light & Power Inc, Philippines
- Semirara Mining Corp, Philippines
- Planning Commission, India
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- New Zealand Coal & Carbon
- Oldendorff Carriers - Singapore
- Siam City Cement PLC, Thailand
- Gujarat Mineral Development Corp Ltd - India
- MS Steel International - UAE
- White Energy Company Limited
- Economic Council, Georgia
- European Bulk Services B.V. - Netherlands
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- Baramulti Group, Indonesia
- Kartika Selabumi Mining - Indonesia
- Kideco Jaya Agung - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Chamber of Mines of South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- Orica Australia Pty. Ltd.
- Xindia Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- Thiess Contractors Indonesia
- ICICI Bank Limited - India
- Simpson Spence & Young - Indonesia
- Videocon Industries ltd - India
- Price Waterhouse Coopers - Russia
- Madhucon Powers Ltd - India
- Sarangani Energy Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- SN Aboitiz Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Indo Tambangraya Megah - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Chettinad Cement Corporation Ltd - India
- SMG Consultants - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- Marubeni Corporation - India
- Africa Commodities Group - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Transport, Egypt
- Medco Energi Mining Internasional
- Aboitiz Power Corporation - Philippines
- Sakthi Sugars Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Indika Energy - Indonesia
- Trasteel International SA, Italy
- Sojitz Corporation - Japan
- Maheswari Brothers Coal Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Miang Besar Coal Terminal - Indonesia
- VISA Power Limited - India
- Bharathi Cement Corporation - India
- San Jose City I Power Corp, Philippines
- Antam Resourcindo - Indonesia
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Australian Coal Association
- Electricity Generating Authority of Thailand
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