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Monday, 27 February 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
 The pessimism in the dry market persists with the Baltic Dry Index still trying to find a steady pace of growth and average time charter earnings for all vessel classes floating at significantly lower levels than 2011. The steel market fundamentals have brought very low earnings for all dry bulk carrier vessels, even for smaller ones handies/supras, which were outperforming last year when capesizes and panamaxes were suffering. There are still hopes for improvement in March and onwards since January and February are seasonally weak months with Chinese buying less iron ore due to National Festivities and hefty stockpiles. Inventories at key Chinese steel mills monitored by China’s Iron & Steel Association reached 10.98 million tones by the end of January, the highest since the second half of 2009 and rising 24.5% from early January. CISA said in its monthly Report that it will be difficult for demand to improve significantly during end February to early March and inventories are likely to continue rising.
The world crude steel production for the 59 countries reporting to the World Steel Association was 117 million tonnes (Mt) in January 2012. This is -7.8% lower than January 2011. China’s crude steel production for January 2012 was 52.1 Mt, a decrease of -13% compared to January 2011. Elsewhere in Asia, Japan produced 8.6 Mt of crude steel in January 2012, a decrease of -10.6% compared to the same month last year. South Korea’s crude steel production for January 2012 was 5.1 Mt, -9.6% down compared to January 2011.
Despite the BDI lost again ground by falling every day during last week it finally ended to close in green with an improvement on Friday by earning 12 points from Thursday’s closing. The BDI closed at 717 points by gaining only 1 point from previous week’s closing of 718 points. Overall, all Baltic Dry Indices closed on green apart from panamaxes. There was an upturn in the capesize segment, a downward trend for panamax and a stronger performance in the supramax and handysize segments. The handysize segment showed the largest increase by gaining 16 points from last week, up 4.2% and ending at 395 points with vessel earnings near to $5,900/day in contrast with a 12% decline in the Baltic Panamax Index by loosing 113 points on a weekly basis and ending at 836 points. The BPI has surpassed the 1,000 points mark in mid February, by standing at 1018 points on February 14th, a yearly high level.
For large size vessels, capesizes, which typically transport 150,000 ton cargoes of iron ore and coal, the BCI ended by gaining 43 points on a weekly basis, up by 2.94% standing at 1504 points with a significant bounce back on Friday. Capesize earnings rose to $5,699/day from the yearly low of $5,158 on February 21st with China boosting its cargo demand loadings from Brazil and Australia. According to a London based analyst at derivatives broker Freight Investor Services Ltd there has been clearly some Chinese buying at these low freight levels that is sufficient to move rates up slightly. Prices (TSIPIO62) for iron ore imported into the Chinese city of Tianjin increased for a fifth session, gaining 0.2 percent to $139 a metric ton, according to figures from the Steel Index Ltd.
Spot prices of imported iron ore in China rose on Friday as traders bid up the market, betting on a recovery in domestic steel demand when construction projects resume next month. According to traders, global miner BHP Billiton sold several cargoes this week at prices around $3 more than previous deals. Australian Pilbara iron ore fines with 61.5 percent iron content was quoted at $138-$140 a tonne, cost and freight, up $2 from Thursday, according to Chinese consultancy Umetal. “Some traders are trying to push up the price because they think steel demand would pick up in March when the weather returns better and construction activity resumes in China”, he said. BHP rivals Rio Tinto and Vale were also offering more cargoes on Friday. Iron ore with a 62% content rose 2.1% to $138.70 per tonne on Thursday, its biggest percentage gain since December 21st, according to Steel Index price provider.
Panamax vessels, which usually transport 60,000-70,000 tonne cargoes of coal and grain, experienced severe decline with earnings falling below $7,000/day, when last year were earning around $14,000/day, and the BPI loosing 113 points from last week’s closing, down by 12% and standing at 836 points. The segment is feeling the pain from overcapacity with at least one panamax, kamsarmax or post panamax being delivered into service every day so far this year. Owners in the Atlantic are said to subsidizing their operating expenses as they are not earning enough to cover the cost of bunkers on ballast legs. With all February grain cargoes from east coast South America fixed to ships earlier this month, the vessels being booked at the moment for March loading dates are almost exclusive those ballasting from the Pacific markets.
Supramax vessels, which carry about 25 percent less than Panamaxes, showed healthier levels from a distressed Atlantic status with earnings rising near to panamax levels of about $6,900/day and the BSI gaining 21 points, up by 3.2% from last week’s closing and standing at 662 points. In addition, handysize units gained a sharp increase of 4.2% with the BHSI standing at 395 with earnings rising to $5,980/day, almost 40% lower than previous year when they earning near to $10,000/day.
Even the positive upturn seen during the last week in the freight markets there is still a road ahead for full recovery since the vessels’ glut is still a major threat for the dry bulk market and Chinese iron ore import market sentiment remains fragile with spot iron ore prices dropping on the increase of port stockpiles. The benchmark iron ore price trading was at $140/tonne in recent months from a record high of $180/tonne seen last year. The chief executive officer of Rio Tinto, the second largest supplier of iron ore, sees a period of volatility of six months for the iron ore market before stabilizing.
The steel needs from China and other developing countries are expected to ensure strong commodity demand on the long term, he added. "The world is an uncertain place at the moment and we have seen some softness in China, but demand remains strong," he said.
China alone will require at least another 100 million metric tons of iron ore a year for the next eight years, including 600 million tons in that period to satisfy growth and 200 million to replace the expected exit of high-cost supplies, he said, adding that Rio plans to contribute about a quarter of this additional ore to China.
The move of China to cut banks’ reserve requirements ratio by 0.5% to be effective from February 24th and Vale’s decision to move to spot iron ore pricing may be two positive key developments for the future of dry bulk earnings. Vale has announced that it will sell 80% of its iron ore at spot market pricing, which satisfies Chinese steelmakers by gaining from falling iron ore prices. February has almost ended and BDI has not still managed to break the psychological barrier of 1,000 points mark with earnings for capesize vessels trading at similar levels with handysizes. March may be a healthier month for large size units as Chinese iron ore stockpiles has shown a sense of retreat during the last days of February, by falling less than the record high of 100 mil tones seen almost two weeks ago, and a boosted Chinese cargo buying demand that increased capesize loadings from Australia and Brazil.
Source: Maria Bertzeletou, Hellenic Shipping
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Wednesday, 07 March 12
ASSESS ASIAS POTENTIAL, DEVELOPMENTS AND APPETITE FOR SHALE AT SHALE GAS SUMMIT
Press Release - Assess Asia’s Potential, Developments and Appetite for Shale at Shale Gas Summit on 23-24 Apr, 2012 in Beijing
China is rep ...
Wednesday, 07 March 12
3RD MOZAMBIQUE COAL CONFERENCE
3rd Mozambique Coal Conference
2-4 July 2012 | Joaquim Chissano International Conference Centre , Maputo, Mozambique
http://www.immevents.com/mo ...
Wednesday, 07 March 12
DRY BULK MARKET KEEPS UP TIMID REBOUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its rising momentum yesterday, rising for the eighth straight session, on the back of renewed demand for smaller bulk c ...
Wednesday, 07 March 12
BUKIT ASAM EYES 39% RISE IN COAL SALES - INSIDER STORIES
Insider Stories reported that, PT Bukit Asam Tbk is scouting a 39% increase in coal sales volume to 18.66 million tons this year from last year with ...
Wednesday, 07 March 12
PETROSEA SEALS US$188 MIO CONTRACT - INSIDER STORIES
Insider Stories reported that, coal mining contractor PT Petrosea Tbk has secured a US$188 million additional contract from its affiliated firm PT S ...
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- Agrawal Coal Company - India
- Anglo American - United Kingdom
- Goldman Sachs - Singapore
- Mjunction Services Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Indogreen Group - Indonesia
- Kepco SPC Power Corporation, Philippines
- Planning Commission, India
- Wilmar Investment Holdings
- Simpson Spence & Young - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Straits Asia Resources Limited - Singapore
- Barasentosa Lestari - Indonesia
- Africa Commodities Group - South Africa
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Vedanta Resources Plc - India
- Indian Oil Corporation Limited
- Edison Trading Spa - Italy
- Carbofer General Trading SA - India
- Interocean Group of Companies - India
- The University of Queensland
- Sical Logistics Limited - India
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Essar Steel Hazira Ltd - India
- ASAPP Information Group - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- Kideco Jaya Agung - Indonesia
- Medco Energi Mining Internasional
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- ICICI Bank Limited - India
- Ministry of Transport, Egypt
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- Billiton Holdings Pty Ltd - Australia
- Parry Sugars Refinery, India
- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Malabar Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Petron Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jindal Steel & Power Ltd - India
- Global Green Power PLC Corporation, Philippines
- Electricity Authority, New Zealand
- Australian Commodity Traders Exchange
- Port Waratah Coal Services - Australia
- Attock Cement Pakistan Limited
- Thai Mozambique Logistica
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- Sakthi Sugars Limited - India
- Latin American Coal - Colombia
- Semirara Mining Corp, Philippines
- South Luzon Thermal Energy Corporation
- Wood Mackenzie - Singapore
- CIMB Investment Bank - Malaysia
- GAC Shipping (India) Pvt Ltd
- Vizag Seaport Private Limited - India
- Energy Link Ltd, New Zealand
- Kaltim Prima Coal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Offshore Bulk Terminal Pte Ltd, Singapore
- Posco Energy - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- Kumho Petrochemical, South Korea
- London Commodity Brokers - England
- Gujarat Sidhee Cement - India
- Aboitiz Power Corporation - Philippines
- Directorate Of Revenue Intelligence - India
- Gujarat Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- Ceylon Electricity Board - Sri Lanka
- Intertek Mineral Services - Indonesia
- Altura Mining Limited, Indonesia
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Mercator Lines Limited - India
- Dalmia Cement Bharat India
- Global Coal Blending Company Limited - Australia
- Salva Resources Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Madhucon Powers Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Indian Energy Exchange, India
- Baramulti Group, Indonesia
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Aditya Birla Group - India
- Tamil Nadu electricity Board
- San Jose City I Power Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Global Business Power Corporation, Philippines
- White Energy Company Limited
- Georgia Ports Authority, United States
- Gujarat Mineral Development Corp Ltd - India
- SMC Global Power, Philippines
- Sarangani Energy Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bhoruka Overseas - Indonesia
- Leighton Contractors Pty Ltd - Australia
- MS Steel International - UAE
- Sree Jayajothi Cements Limited - India
- Trasteel International SA, Italy
- Eastern Coal Council - USA
- Karaikal Port Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Formosa Plastics Group - Taiwan
- GVK Power & Infra Limited - India
- Electricity Generating Authority of Thailand
- Lanco Infratech Ltd - India
- Parliament of New Zealand
- IEA Clean Coal Centre - UK
- Economic Council, Georgia
- Central Electricity Authority - India
- Tata Chemicals Ltd - India
- Siam City Cement PLC, Thailand
- PowerSource Philippines DevCo
- Therma Luzon, Inc, Philippines
- PTC India Limited - India
- Bayan Resources Tbk. - Indonesia
- Standard Chartered Bank - UAE
- Coal and Oil Company - UAE
- Bhatia International Limited - India
- India Bulls Power Limited - India
- Samtan Co., Ltd - South Korea
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Karbindo Abesyapradhi - Indoneisa
- Ambuja Cements Ltd - India
- Orica Mining Services - Indonesia
- Meralco Power Generation, Philippines
- The Treasury - Australian Government
- Kartika Selabumi Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- The State Trading Corporation of India Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Coalindo Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Australian Coal Association
- GMR Energy Limited - India
- Merrill Lynch Commodities Europe
- Rashtriya Ispat Nigam Limited - India
- VISA Power Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Eastern Energy - Thailand
- New Zealand Coal & Carbon
- OPG Power Generation Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Antam Resourcindo - Indonesia
- IHS Mccloskey Coal Group - USA
- PetroVietnam Power Coal Import and Supply Company
- Star Paper Mills Limited - India
- TeaM Sual Corporation - Philippines
- Videocon Industries ltd - India
- Toyota Tsusho Corporation, Japan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercuria Energy - Indonesia
- McConnell Dowell - Australia
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- Bhushan Steel Limited - India
- Oldendorff Carriers - Singapore
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- European Bulk Services B.V. - Netherlands
- Holcim Trading Pte Ltd - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indika Energy - Indonesia
- Cement Manufacturers Association - India
- Siam City Cement - Thailand
- Independent Power Producers Association of India
- Power Finance Corporation Ltd., India
- Iligan Light & Power Inc, Philippines
- Ministry of Mines - Canada
- Price Waterhouse Coopers - Russia
- Romanian Commodities Exchange
- Meenaskhi Energy Private Limited - India
- Bharathi Cement Corporation - India
- Uttam Galva Steels Limited - India
- CNBM International Corporation - China
- Singapore Mercantile Exchange
- Maharashtra Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Renaissance Capital - South Africa
- Chettinad Cement Corporation Ltd - India
- Bukit Makmur.PT - Indonesia
- Banpu Public Company Limited - Thailand
- Sinarmas Energy and Mining - Indonesia
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Borneo Indobara - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Riau Bara Harum - Indonesia
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