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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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- Antam Resourcindo - Indonesia
- Bhatia International Limited - India
- Savvy Resources Ltd - HongKong
- Sakthi Sugars Limited - India
- Chettinad Cement Corporation Ltd - India
- Minerals Council of Australia
- Riau Bara Harum - Indonesia
- Ministry of Transport, Egypt
- GVK Power & Infra Limited - India
- Deloitte Consulting - India
- Karaikal Port Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- Carbofer General Trading SA - India
- Australian Commodity Traders Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Kepco SPC Power Corporation, Philippines
- Electricity Authority, New Zealand
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Rashtriya Ispat Nigam Limited - India
- South Luzon Thermal Energy Corporation
- Thiess Contractors Indonesia
- PTC India Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- GAC Shipping (India) Pvt Ltd
- Samtan Co., Ltd - South Korea
- TeaM Sual Corporation - Philippines
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- Petron Corporation, Philippines
- Tata Chemicals Ltd - India
- Agrawal Coal Company - India
- Kalimantan Lumbung Energi - Indonesia
- Sindya Power Generating Company Private Ltd
- MS Steel International - UAE
- Binh Thuan Hamico - Vietnam
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Bhoruka Overseas - Indonesia
- Essar Steel Hazira Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Dalmia Cement Bharat India
- Ministry of Finance - Indonesia
- Sojitz Corporation - Japan
- Parliament of New Zealand
- Georgia Ports Authority, United States
- LBH Netherlands Bv - Netherlands
- Trasteel International SA, Italy
- Billiton Holdings Pty Ltd - Australia
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- SMG Consultants - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Meralco Power Generation, Philippines
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Jindal Steel & Power Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IHS Mccloskey Coal Group - USA
- Indo Tambangraya Megah - Indonesia
- Indika Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- European Bulk Services B.V. - Netherlands
- Chamber of Mines of South Africa
- Lanco Infratech Ltd - India
- Indonesian Coal Mining Association
- Posco Energy - South Korea
- Banpu Public Company Limited - Thailand
- PowerSource Philippines DevCo
- Kumho Petrochemical, South Korea
- Standard Chartered Bank - UAE
- Coalindo Energy - Indonesia
- Eastern Energy - Thailand
- Uttam Galva Steels Limited - India
- Therma Luzon, Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- SN Aboitiz Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- Orica Mining Services - Indonesia
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Borneo Indobara - Indonesia
- Baramulti Group, Indonesia
- Kapuas Tunggal Persada - Indonesia
- IEA Clean Coal Centre - UK
- Barasentosa Lestari - Indonesia
- Kartika Selabumi Mining - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Mines - Canada
- Global Coal Blending Company Limited - Australia
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- Formosa Plastics Group - Taiwan
- London Commodity Brokers - England
- Bukit Asam (Persero) Tbk - Indonesia
- Bulk Trading Sa - Switzerland
- Medco Energi Mining Internasional
- The State Trading Corporation of India Ltd
- Edison Trading Spa - Italy
- Commonwealth Bank - Australia
- Miang Besar Coal Terminal - Indonesia
- San Jose City I Power Corp, Philippines
- Wood Mackenzie - Singapore
- Central Java Power - Indonesia
- Bangladesh Power Developement Board
- Pipit Mutiara Jaya. PT, Indonesia
- Thai Mozambique Logistica
- Economic Council, Georgia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Coal Association
- New Zealand Coal & Carbon
- Attock Cement Pakistan Limited
- Sical Logistics Limited - India
- Salva Resources Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Merrill Lynch Commodities Europe
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Coal and Oil Company - UAE
- Interocean Group of Companies - India
- McConnell Dowell - Australia
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining Corp, Philippines
- Makarim & Taira - Indonesia
- Bukit Makmur.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- SMC Global Power, Philippines
- Vizag Seaport Private Limited - India
- Gujarat Sidhee Cement - India
- Global Business Power Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- GMR Energy Limited - India
- Krishnapatnam Port Company Ltd. - India
- Intertek Mineral Services - Indonesia
- Siam City Cement PLC, Thailand
- Energy Development Corp, Philippines
- Coastal Gujarat Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Port Waratah Coal Services - Australia
- AsiaOL BioFuels Corp., Philippines
- Madhucon Powers Ltd - India
- Kobexindo Tractors - Indoneisa
- Ind-Barath Power Infra Limited - India
- Oldendorff Carriers - Singapore
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Mjunction Services Limited - India
- Rio Tinto Coal - Australia
- Mintek Dendrill Indonesia
- The University of Queensland
- Planning Commission, India
- Bukit Baiduri Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Mercuria Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- ASAPP Information Group - India
- Larsen & Toubro Limited - India
- Videocon Industries ltd - India
- VISA Power Limited - India
- Sree Jayajothi Cements Limited - India
- Marubeni Corporation - India
- Directorate Of Revenue Intelligence - India
- Renaissance Capital - South Africa
- Grasim Industreis Ltd - India
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Parry Sugars Refinery, India
- Romanian Commodities Exchange
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- Cement Manufacturers Association - India
- Ambuja Cements Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Gujarat Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Goldman Sachs - Singapore
- CNBM International Corporation - China
- Globalindo Alam Lestari - Indonesia
- Indogreen Group - Indonesia
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Electricity Generating Authority of Thailand
- Semirara Mining and Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Siam City Cement - Thailand
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Xindia Steels Limited - India
- Indian Oil Corporation Limited
- Latin American Coal - Colombia
- Kaltim Prima Coal - Indonesia
- Metalloyd Limited - United Kingdom
- White Energy Company Limited
- Heidelberg Cement - Germany
- Wilmar Investment Holdings
- Star Paper Mills Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Simpson Spence & Young - Indonesia
- Alfred C Toepfer International GmbH - Germany
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