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Friday, 15 July 11
DRY BULK MARKET SUFFERS NEW BLOW, RETREATS EVEN FURTHER - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The dry bulk market fell even lower yesterday on the back of lower demand for larger vessels, like Capesizes and Panamaxes. The industry’s benchmark, the Baltic Dry Index (BDI) was down by 16 points to 1,367, with the Baltic Capesize Index (BCI) down even further to 1,943 points, while Panamaxes were also among the main “losers” with the Baltic Panamax Index (BPI) falling to 1,606 points as well. By contrast, the smaller vessel types were unchanged yesterday.
In light of this weak demand, it’s useful to take a look on the latest dry bulk demand estimated from BIMCO. According to the analysis, “the healthy demand picture of some 6% demand growth is what keeps the dry bulkers afloat. Despite the multiple disruptions that have already taken place, we see growing demand for almost all commodities. This has certainly prevented a meltdown of freight rates. Many people expected the current doldrums already last year, but extremely strong demand growth in 2010 postponed the hardship into 2011. While Capesize vessels are having the worst time of their lives, Supramaxes have kept up quite well recently – particularly in the Atlantic, where rates have moved more sideways than down. But the overall direction is in tune with all the other dry bulk vessel sizes – and that’s “southbound”. Even the smallest vessel type, Handysize, has not completely withstood the overall downward pressure, as rates in that segment are down 45% in May y-o-y. But if you look closer at 2011 alone, Handysize rates have been very stable in the USD 10,000-12,000 per day interval.
Like the tanker business has already done for some time now, the dry bulk business is settling in for an endurance race, as profitability hits new lows. Queensland, Australia, is getting closer to normal throughput following the severe flooding in January that hampered especially coal exports but also weakened the prospects of an otherwise strong high quality wheat harvest and subsequently strong export volumes. As Australian coking coal exports have been limited due to the extensive floods, the shortage has been spilling over into rising regional coal prices. That has benefitted the US, South African and Columbian exports, which in combination with falling freight costs, has made long distance coal transports competitive.
Extraordinary post-quake demand from Japan remains to be seen and the lack of dry bulk commodity demand from Japan is expected to stay around for another few months. As an exception the steel industry has managed to prevent a massive drop in output and thus also kept raw material imports steady. Official Japanese estimates point at a less than 3% drop in steel production in Q2 as compared to same period last year. Thus Japanese iron ore and coking coal demand have not been great movers in the market and are not really expected to become so throughout the remainder of 2011. What happens in the medium term depends largely on when rebuilding of the nation kicks off big time. Overall Japanese industrial production fell by 14.0% y-o-y in March, this is a significant drop bearing in mind that 1/3 of the month was normal.
Regardless of the slightly softer overall demand picture that is playing out when comparing it to the forecast at the start of the year, demand for most commodities is solid. Iron ore is set to be the best performer of the major bulk commodities at 1,040 million tons (+6% y-o-y) and amongst the minor bulks, cement stand out positively as it claws its way back from the 2009-abyss. The level is still some 15 million tons shy of the 2006-peak, but the cement trade is on course for 91 million tons, which will then be the highest demand on record when you exclude the extraordinary years 2005-2008” said BIMCO’s shipping analyst Peter Sand.
Another interesting insight can be given through the latest trends regarding demolition activity. According to the latest weekly report from Piraeus-based shipbroker, Golden Destiny, “in the demolition market, there has been a subdued sentiment with India offering weaker scrap rates and Bangladesh situation still being vague. Pakistan is trying to bid some tonnage, while China has stepped behind offering the lowest levels. In the bulk carrier segment, capesizes are still on the spotlight with about 47 units reported to have been sent to the scrap yards within the year.
There is a feeling that this trend will continue till the end of the year as capesize time charter equivalent earnings have not yet fully recovered, even though are floating above $10,000/day.
The recent softness in scrap prices has caused some worries about the trend in the coming weeks and some of the buyers and sellers wait and watch before committing to new deals. Rumors that the expected market closure in Bangladesh may not be forced on the beginning of July, leaves hopes for a future spike in rates. Bangladesh is now offering $495/ldt for dry/general cargo and $520/ldt for wet cargo, while in India scrap levels have fallen by $30-$40/ldt from May. It is worth mentioning the intensive scrapping trend in the reefer segment during the last month in the scrap yards of India.
The week ended at a slow pace of demolition activity but at higher levels from previous week with 11 vessels reported to have been headed to the scrap yards of total deadweight 850,332 tons. Bulk carriers have grasped the lion share, 55% of this week’s volume of business with 67% of the scrapping business being centred on large size units, capesizes and VLOC. In terms of the reported number of transactions, the demolition activity has been marked with a 22% week-on-week increase and in terms of the total deadweight sent for scrap there has been a 71% increase. In terms of scrap rates, the highest scrap rate has been achieved this week for M/V “Berge Pacific” 231,851dwt of 33,679 ldt at $505/ldt with buyers option India – Pakistan-Bangladeh. At similar week in 2010, demolition activity in terms of the reported number of transactions was down by 81% than the current levels, when 2 vessels had been reported for scrap of total deadweight 204 mil tons with India offering the highest levels $375/ldt for dry and $400/ldt for wet cargo” concluded Golden Destiny.
Source: Nikos Roussanoglou, Hellenic Shipping
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Thursday, 21 July 11
DRY BULK RATES EDGE FURTHER DOWN ON WEAK MARKET SENTIMENT - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market fell once again on Wednesday marking the ninth straight day of losses. The industry’s benchmark, the Baltic Dry Index (BDI ...
Wednesday, 20 July 11
ANTWERP RECEIVES THE CAPESIZE MG COURAGE
The deepening of the Western Scheldt has made the port of Antwerp easily accessible not only to Ultra Large Container Ships of over 10,000 TEU but a ...
Wednesday, 20 July 11
KALIMANTAN GOLD APPOINTS COMMISSIONER TO SUBSIDIARY
Kalimantan Gold Corporation Limited has announced the appointment of Dr. Bambang Setiawan as Commissioner (a senior advisor) to the Board of PT Kali ...
Wednesday, 20 July 11
CHALLENGER GETS TABANG PROJECT IUP PERMIT
COALspot.com - Challenger Deep Resources Corporation has been getting exploration permit or Izin Usaha Pertambangan (IUP) for its Tabang coal in Eas ...
Wednesday, 20 July 11
TCM COAL PROJECT IN SOUTH KALIMANTAN MOVES TO FINAL FEASIBILITY STUDY
COALspot.com - Pan Asia Corporation Ltd has executed a formal agreement with an underground mining group KOPEX to undertake a final feasibilit ...
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- Directorate Of Revenue Intelligence - India
- CIMB Investment Bank - Malaysia
- Grasim Industreis Ltd - India
- Binh Thuan Hamico - Vietnam
- Global Business Power Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Parliament of New Zealand
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- Price Waterhouse Coopers - Russia
- Meenaskhi Energy Private Limited - India
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Petron Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- OPG Power Generation Pvt Ltd - India
- Economic Council, Georgia
- Standard Chartered Bank - UAE
- Iligan Light & Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- Indonesian Coal Mining Association
- Cement Manufacturers Association - India
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Energy Link Ltd, New Zealand
- Holcim Trading Pte Ltd - Singapore
- MS Steel International - UAE
- Indian Oil Corporation Limited
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- Africa Commodities Group - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Bukit Makmur.PT - Indonesia
- LBH Netherlands Bv - Netherlands
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- Power Finance Corporation Ltd., India
- Riau Bara Harum - Indonesia
- Wood Mackenzie - Singapore
- Karaikal Port Pvt Ltd - India
- Orica Mining Services - Indonesia
- Bangladesh Power Developement Board
- Coal and Oil Company - UAE
- Sojitz Corporation - Japan
- Mercuria Energy - Indonesia
- The State Trading Corporation of India Ltd
- Salva Resources Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Tamil Nadu electricity Board
- Pipit Mutiara Jaya. PT, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- CNBM International Corporation - China
- Goldman Sachs - Singapore
- Central Java Power - Indonesia
- Mintek Dendrill Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Sindya Power Generating Company Private Ltd
- Kaltim Prima Coal - Indonesia
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The University of Queensland
- Borneo Indobara - Indonesia
- Oldendorff Carriers - Singapore
- PTC India Limited - India
- Siam City Cement PLC, Thailand
- Indogreen Group - Indonesia
- Energy Development Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- GMR Energy Limited - India
- Intertek Mineral Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Deloitte Consulting - India
- Chamber of Mines of South Africa
- Kepco SPC Power Corporation, Philippines
- Australian Coal Association
- Attock Cement Pakistan Limited
- PetroVietnam Power Coal Import and Supply Company
- Coalindo Energy - Indonesia
- Orica Australia Pty. Ltd.
- Australian Commodity Traders Exchange
- Leighton Contractors Pty Ltd - Australia
- Anglo American - United Kingdom
- SMC Global Power, Philippines
- The Treasury - Australian Government
- Ambuja Cements Ltd - India
- Sakthi Sugars Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Posco Energy - South Korea
- Indo Tambangraya Megah - Indonesia
- Dalmia Cement Bharat India
- Maheswari Brothers Coal Limited - India
- Kideco Jaya Agung - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Jaiprakash Power Ventures ltd
- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Madhucon Powers Ltd - India
- Independent Power Producers Association of India
- Asmin Koalindo Tuhup - Indonesia
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bhatia International Limited - India
- Formosa Plastics Group - Taiwan
- Therma Luzon, Inc, Philippines
- Tata Chemicals Ltd - India
- Wilmar Investment Holdings
- PowerSource Philippines DevCo
- Romanian Commodities Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- Essar Steel Hazira Ltd - India
- Lanco Infratech Ltd - India
- Eastern Energy - Thailand
- ICICI Bank Limited - India
- Central Electricity Authority - India
- Interocean Group of Companies - India
- Port Waratah Coal Services - Australia
- Sinarmas Energy and Mining - Indonesia
- Edison Trading Spa - Italy
- Jindal Steel & Power Ltd - India
- Global Coal Blending Company Limited - Australia
- London Commodity Brokers - England
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rio Tinto Coal - Australia
- Bharathi Cement Corporation - India
- Vedanta Resources Plc - India
- Directorate General of MIneral and Coal - Indonesia
- Antam Resourcindo - Indonesia
- Straits Asia Resources Limited - Singapore
- Kobexindo Tractors - Indoneisa
- Baramulti Group, Indonesia
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- GVK Power & Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Ministry of Finance - Indonesia
- Meralco Power Generation, Philippines
- Sree Jayajothi Cements Limited - India
- Billiton Holdings Pty Ltd - Australia
- Marubeni Corporation - India
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercator Lines Limited - India
- VISA Power Limited - India
- Indian Energy Exchange, India
- San Jose City I Power Corp, Philippines
- Thai Mozambique Logistica
- Renaissance Capital - South Africa
- Gujarat Sidhee Cement - India
- Star Paper Mills Limited - India
- Aboitiz Power Corporation - Philippines
- Siam City Cement - Thailand
- Larsen & Toubro Limited - India
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Makarim & Taira - Indonesia
- Aditya Birla Group - India
- Bhoruka Overseas - Indonesia
- Sical Logistics Limited - India
- Ministry of Mines - Canada
- Manunggal Multi Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- Latin American Coal - Colombia
- ASAPP Information Group - India
- Barasentosa Lestari - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Coastal Gujarat Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Mjunction Services Limited - India
- Ministry of Transport, Egypt
- Bulk Trading Sa - Switzerland
- Petrochimia International Co. Ltd.- Taiwan
- Savvy Resources Ltd - HongKong
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- IEA Clean Coal Centre - UK
- GAC Shipping (India) Pvt Ltd
- Simpson Spence & Young - Indonesia
- Kartika Selabumi Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Parry Sugars Refinery, India
- Altura Mining Limited, Indonesia
- White Energy Company Limited
- Alfred C Toepfer International GmbH - Germany
- New Zealand Coal & Carbon
- Electricity Authority, New Zealand
- Heidelberg Cement - Germany
- SMG Consultants - Indonesia
- Singapore Mercantile Exchange
- Samtan Co., Ltd - South Korea
- Georgia Ports Authority, United States
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