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Thursday, 15 December 11
DRY BULK RATES TO REMAIN AT CURRENT LEVELS FOR THE MOST PART IN THE COMING MONTHS SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 In its latest research note, BIMCO said that the Capesize Time Charter Average will remain at USD 20,000-30,000 per day but the tonnage oversupply will eventually hit back.
Meanwhile, it reiterated its forecast on the Panamax and Supramax freight rates that are likely to stay put in the USD 13,000-17,000 per day interval. Handysize rates are expected to gain traction and return to the USD 9,000-13,000 per day interval.According to BIMCO’s analysis “despite the the supply-side pressure, we put our money on black and forecast that Capesize rates are going to be supported by lower iron ore prices and coal demand for Winter heating in the coming months, thus we expect freight rates to stay sensitive to iron ore price developments but above USD 20,000 per day. A key observation from BIMCO is that we believe mining companies will prefer to sell this important steel production ingredient in larger volumes rather than higher prices, as long as China appears ready to purchase.
In order to deliver the support needed to keep rates elevated, Chinese iron ore imports will need a level of 61.2 million tonnes in both November and December, which in turn will bring the annual total import growth to +10% y-o-y. The supporting argument that must trump the negative impact from high stockpiles and slower steel production is the pricing game. China has built a firm reputation for playing the commodity markets well.
Looking beyond the Capesize fleet and into 2012, the smaller-in-size segments are going to experience a healthy slowdown in new deliveries. Right now, deliveries are estimated at 80 million DWT – equal to a fleet growth of 11.4%; a number that is likely to get slightly inflated by vessels that were set for December delivery but end up being January deliveries instead. A potential upside may also come from Russia, if they decide to impose a ban on grain exports to stop excessive outflow of the foodstuff. This will lead to longer hauls, as African and Middle Eastern importers will have to look for alternative sources potentially further away. Should they go to the most likely exporters, Australia or Argentina, the impact on the freight markets will be most significant” said BIMCO.
On the supply side, BIMCO’s Chief Shipping Analyst, Peter Sand said that the active fleet has grown by 12.9% so far in 2011, caused by delivery of 1,050 new vessels equal to 86 million DWT, offset by 20.9 million DWT being demolished. “We expect total demolition in 2011 to end at 23.5 million DWT as the activity is slowing down. Total inflow of tonnage in 2011 is going to hit 100 million DWT, surpassing 2010 inflow of new tonnage by as much as 20%. The fleet is about to grow by 14.5%, which is the highest level ever in net and gross terms.
By early December, 230 new Capesize vessels (+170,000 DWT) were delivered. That’s more than one new vessel every second day throughout the year. In total, BIMCO expects 245 new Capesizes will have been delivered in 2011 before New Year’s Eve. The projections for next year anticipates delivery of another 220 new Capesizes. Strong inflow of new tonnage and high amounts of recycled tonnage have brought the average age of the Capesize fleet down to 11.5 years from 13 at the start of the year. The level of new contracts dropped month by month as the year passed by. From close to 5 million DWT contracted in January, only 0.8 million DWT was contracted in October. This is a 29-months’ low level – an extremely positive development that bodes well for this segment of the industry, especially when seen in the perspective of the rise in freight rates during the past few months and owners not queuing up to place new orders” said Sand.
Just two months ago BIMCO released an analysis entitled: “Record recycling activity stirs optimism in dry bulk”. By that time, the potential of reaching 25 million DWT was within reach if high demolition rates were kept attractive to owners and rates did not improve significantly. Today, the “bull run” towards the recycling yards is over, demolition rates have come down in the Far East and Bangladesh has stopped taking in more new business. Meanwhile, average freight rates have stayed more or less unchanged, near year-high levels, making demolition activity cool down significantly.
On the demand side, BIMCO said that “while the workhorses in the Panamax and Supramax segments performed in line with the BIMCO forecast – hovering around USD 15,000 per day – Handysize vessels performed slightly worse than expected, tipping their toes just South of the USD 10,000 per day. On the very positive side, Capesize rates tackled the dip at end-October to see rates soaring again in November. The development is driven purely by vessels chartered to haul iron ore to China. Coming down from 28 chartered ships a week by mid-October, weekly activity dropped to 11 per week by the end of October, due to falling steel prices. However, activity rebounded strongly throughout November as iron ore prices fell rather significantly too to offset the negative impact from falling steel prices, according to Commodore Research. This development is mirrored perfectly in average time charter rates.
Export prospects for Russian wheat are still strong and building. This is evident from recent very strong sales following solid demand for vast volumes and competitively priced wheat, despite appreciation of the Rouble against other currencies. However, there are concerns arising in the wake of the success that Russia will impose grain export restrictions should total grain exports reach 24 million tons. In an attempt to export before restrictions are imposed, traders and producers are shipping a lot of output to ports, creating railway jams. Ironically, these jams lowered the pace of exports in October.
The Panamax and Supramax rates in the Atlantic basin have found only little support in the wheat and grains coming into the market via the US Gulf. Rates have come off over the past months, but should firm slowly as demand for thermal coal picks up as we head into the Winter in the northern hemisphere.
Overall demand in 2011 is likely to end at 6% y-o-y, while demand growth in 2012 is looking a bit softer at 4% y-o-y” concluded BIMCO.
Source: Nikos Roussanoglou, Hellenic Shipping
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Monday, 12 December 11
DRY BULK MARKET LOOKING FOR BALANCE AS WE ENTER 2012 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
During the past few months, freight rates for dry bulk carriers, especially Capesizes have increased significantly, providing ship owners with a muc ...
Sunday, 11 December 11
THE PANAMAX INDEX ENDED ON POSITIVE DIRECTION - VISTAAR
COALspot.com - The BDI and Cape index continued the upward trend this week also with BDI up by 3.00 pct closing at 1,922 points and Cape index up by ...
Saturday, 10 December 11
MAHAKAM RIVER RESUMES COAL TRANSPORTATION
COALspot.com - East Kalimantan local government has resumed limited coal barging through Mahakam River after two weeks of suspension following the c ...
Friday, 09 December 11
DRY BULK MARKET REBOUNDS ON HEALTHIER DEMAND OUTLOOK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market edged forward yesterday, at the highest rate of the past couple of weeks, as a result of stonger iron ore demand, backed by lowe ...
Thursday, 08 December 11
INDIA MAY SEE 41% ANNUAL GROWTH OF ITS COAL DEMAND DURING THE NEXT 5 YEARS - ICAP SHIPPING
India’s Ministry of Coal expects that India’s coal demand may face an annual 41% rise during the next 5 years, while its coal deficit is ...
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- AsiaOL BioFuels Corp., Philippines
- Indogreen Group - Indonesia
- McConnell Dowell - Australia
- Sree Jayajothi Cements Limited - India
- Coal and Oil Company - UAE
- Wood Mackenzie - Singapore
- Intertek Mineral Services - Indonesia
- Jaiprakash Power Ventures ltd
- Central Electricity Authority - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Global Business Power Corporation, Philippines
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- Siam City Cement - Thailand
- Economic Council, Georgia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Standard Chartered Bank - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Electricity Authority, New Zealand
- Semirara Mining and Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Rio Tinto Coal - Australia
- Global Green Power PLC Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Australian Coal Association
- Attock Cement Pakistan Limited
- Directorate Of Revenue Intelligence - India
- Coastal Gujarat Power Limited - India
- Global Coal Blending Company Limited - Australia
- Chettinad Cement Corporation Ltd - India
- Medco Energi Mining Internasional
- San Jose City I Power Corp, Philippines
- Indian Energy Exchange, India
- Parry Sugars Refinery, India
- Commonwealth Bank - Australia
- Ind-Barath Power Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Bhatia International Limited - India
- Kobexindo Tractors - Indoneisa
- Ministry of Finance - Indonesia
- The Treasury - Australian Government
- London Commodity Brokers - England
- Rashtriya Ispat Nigam Limited - India
- Independent Power Producers Association of India
- Deloitte Consulting - India
- Semirara Mining Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- Borneo Indobara - Indonesia
- Sojitz Corporation - Japan
- IEA Clean Coal Centre - UK
- Bangladesh Power Developement Board
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Carbofer General Trading SA - India
- ASAPP Information Group - India
- Altura Mining Limited, Indonesia
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Kohat Cement Company Ltd. - Pakistan
- Orica Mining Services - Indonesia
- Sical Logistics Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Thai Mozambique Logistica
- Mercator Lines Limited - India
- OPG Power Generation Pvt Ltd - India
- Wilmar Investment Holdings
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Australian Commodity Traders Exchange
- Romanian Commodities Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- ICICI Bank Limited - India
- Minerals Council of Australia
- Marubeni Corporation - India
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- VISA Power Limited - India
- IHS Mccloskey Coal Group - USA
- Georgia Ports Authority, United States
- Bukit Baiduri Energy - Indonesia
- Aditya Birla Group - India
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Eastern Energy - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- White Energy Company Limited
- Madhucon Powers Ltd - India
- GVK Power & Infra Limited - India
- Tata Chemicals Ltd - India
- Kepco SPC Power Corporation, Philippines
- Malabar Cements Ltd - India
- Lanco Infratech Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- MS Steel International - UAE
- Maheswari Brothers Coal Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bharathi Cement Corporation - India
- CIMB Investment Bank - Malaysia
- CNBM International Corporation - China
- GMR Energy Limited - India
- Straits Asia Resources Limited - Singapore
- Ministry of Mines - Canada
- Energy Development Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Therma Luzon, Inc, Philippines
- Anglo American - United Kingdom
- Agrawal Coal Company - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sakthi Sugars Limited - India
- Heidelberg Cement - Germany
- Xindia Steels Limited - India
- Salva Resources Pvt Ltd - India
- Chamber of Mines of South Africa
- Energy Link Ltd, New Zealand
- Port Waratah Coal Services - Australia
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Africa Commodities Group - South Africa
- Kumho Petrochemical, South Korea
- Indonesian Coal Mining Association
- Samtan Co., Ltd - South Korea
- Singapore Mercantile Exchange
- Metalloyd Limited - United Kingdom
- Kideco Jaya Agung - Indonesia
- SMC Global Power, Philippines
- European Bulk Services B.V. - Netherlands
- Banpu Public Company Limited - Thailand
- Bhoruka Overseas - Indonesia
- Antam Resourcindo - Indonesia
- Baramulti Group, Indonesia
- Indika Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Vijayanagar Sugar Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Power Finance Corporation Ltd., India
- Thiess Contractors Indonesia
- Tamil Nadu electricity Board
- Directorate General of MIneral and Coal - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Maharashtra Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Latin American Coal - Colombia
- Ministry of Transport, Egypt
- Indo Tambangraya Megah - Indonesia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- Eastern Coal Council - USA
- Merrill Lynch Commodities Europe
- Posco Energy - South Korea
- Grasim Industreis Ltd - India
- Petron Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Makarim & Taira - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Star Paper Mills Limited - India
- Edison Trading Spa - Italy
- Coalindo Energy - Indonesia
- Uttam Galva Steels Limited - India
- Mjunction Services Limited - India
- Meralco Power Generation, Philippines
- Binh Thuan Hamico - Vietnam
- Sinarmas Energy and Mining - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kaltim Prima Coal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Karaikal Port Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Larsen & Toubro Limited - India
- New Zealand Coal & Carbon
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- India Bulls Power Limited - India
- Gujarat Sidhee Cement - India
- LBH Netherlands Bv - Netherlands
- Central Java Power - Indonesia
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- TeaM Sual Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
- Bulk Trading Sa - Switzerland
- Savvy Resources Ltd - HongKong
- Aboitiz Power Corporation - Philippines
- Cement Manufacturers Association - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- Price Waterhouse Coopers - Russia
- Ambuja Cements Ltd - India
- PTC India Limited - India
- Toyota Tsusho Corporation, Japan
- Miang Besar Coal Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Dalmia Cement Bharat India
- Goldman Sachs - Singapore
- The University of Queensland
- Iligan Light & Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Ceylon Electricity Board - Sri Lanka
- International Coal Ventures Pvt Ltd - India
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