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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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Sunday, 19 February 12
THE SPOT FIXTURE RATES WERE REPORTED AT HIGH LEVELS - VISTAAR
COALspot.com - "The markets seems to holding back this week appears the momentum which picked up last week may slow down" - Capt. Reddy of ...
Sunday, 19 February 12
INDIKA ACQUIRES MULTI TAMBANGJAYA - INSIDER STORIES
Insider Stories reported that, PT Indika Energy Tbk (INDY) announced that wholly-owned subsidiaries have signed a conditional sale and purchase agre ...
Friday, 17 February 12
COLOMBIA COAL PRODUCTION, EXPORTS JUMP IN 2011: GOVT - COLOMBIA REPORTS
Colombia Reports reported that, colombia's coal production jumped 15.4% in 2011 to 85.8 million tonnes versus the previous year while exports rose ...
Thursday, 16 February 12
GEARING UP FOR THE EMERGING OIL & GAS OPPORTUNITIES IN MYANMAR
Press Release - Myanmar Ministry of Energy and Centre for Management Technology (CMT) to Co-host MOGP (Myanmar Oil, Gas & Power) Summit on 28 - ...
Wednesday, 15 February 12
HBA FOR FEB 2012, CLIMBS 2.09 PERCENT AND REACHED US$ 111.58 PER TON
COALspot.com - The Indonesian coal reference price for February climbs 2.09 percent to US$111.58 per ton after losing past three months. ...
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- Parry Sugars Refinery, India
- Gujarat Mineral Development Corp Ltd - India
- Therma Luzon, Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- Kohat Cement Company Ltd. - Pakistan
- IEA Clean Coal Centre - UK
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coal and Oil Company - UAE
- Port Waratah Coal Services - Australia
- Independent Power Producers Association of India
- Electricity Authority, New Zealand
- GAC Shipping (India) Pvt Ltd
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Star Paper Mills Limited - India
- Global Business Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Africa Commodities Group - South Africa
- Makarim & Taira - Indonesia
- Binh Thuan Hamico - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Renaissance Capital - South Africa
- PowerSource Philippines DevCo
- Manunggal Multi Energi - Indonesia
- Antam Resourcindo - Indonesia
- The University of Queensland
- Karbindo Abesyapradhi - Indoneisa
- Standard Chartered Bank - UAE
- Uttam Galva Steels Limited - India
- ICICI Bank Limited - India
- Gujarat Sidhee Cement - India
- South Luzon Thermal Energy Corporation
- Minerals Council of Australia
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Lanco Infratech Ltd - India
- Indo Tambangraya Megah - Indonesia
- Barasentosa Lestari - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Power Finance Corporation Ltd., India
- CNBM International Corporation - China
- Timah Investasi Mineral - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Australian Commodity Traders Exchange
- Coastal Gujarat Power Limited - India
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Banpu Public Company Limited - Thailand
- Bulk Trading Sa - Switzerland
- London Commodity Brokers - England
- Samtan Co., Ltd - South Korea
- Orica Mining Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Eastern Energy - Thailand
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Energy Link Ltd, New Zealand
- Orica Australia Pty. Ltd.
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GMR Energy Limited - India
- Siam City Cement PLC, Thailand
- Posco Energy - South Korea
- Marubeni Corporation - India
- Indian Energy Exchange, India
- Bhushan Steel Limited - India
- Energy Development Corp, Philippines
- Interocean Group of Companies - India
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- PTC India Limited - India
- Pendopo Energi Batubara - Indonesia
- Ind-Barath Power Infra Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Madhucon Powers Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Aboitiz Power Corporation - Philippines
- Mercator Lines Limited - India
- Jindal Steel & Power Ltd - India
- Georgia Ports Authority, United States
- The Treasury - Australian Government
- Sinarmas Energy and Mining - Indonesia
- Kepco SPC Power Corporation, Philippines
- ASAPP Information Group - India
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- India Bulls Power Limited - India
- Thai Mozambique Logistica
- European Bulk Services B.V. - Netherlands
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Karaikal Port Pvt Ltd - India
- Tamil Nadu electricity Board
- Ceylon Electricity Board - Sri Lanka
- Sical Logistics Limited - India
- Electricity Generating Authority of Thailand
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- SMG Consultants - Indonesia
- Mjunction Services Limited - India
- Romanian Commodities Exchange
- The State Trading Corporation of India Ltd
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Essar Steel Hazira Ltd - India
- International Coal Ventures Pvt Ltd - India
- Videocon Industries ltd - India
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Bhoruka Overseas - Indonesia
- New Zealand Coal & Carbon
- SMC Global Power, Philippines
- Sakthi Sugars Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Finance - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Edison Trading Spa - Italy
- Salva Resources Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Global Coal Blending Company Limited - Australia
- Mercuria Energy - Indonesia
- Goldman Sachs - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Planning Commission, India
- McConnell Dowell - Australia
- Asmin Koalindo Tuhup - Indonesia
- Central Java Power - Indonesia
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- Toyota Tsusho Corporation, Japan
- Xindia Steels Limited - India
- Vizag Seaport Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Transport, Egypt
- Kumho Petrochemical, South Korea
- Altura Mining Limited, Indonesia
- Australian Coal Association
- Dalmia Cement Bharat India
- Jaiprakash Power Ventures ltd
- Central Electricity Authority - India
- Coalindo Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- Intertek Mineral Services - Indonesia
- GVK Power & Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- Parliament of New Zealand
- Holcim Trading Pte Ltd - Singapore
- Medco Energi Mining Internasional
- Maheswari Brothers Coal Limited - India
- White Energy Company Limited
- Ministry of Mines - Canada
- Semirara Mining Corp, Philippines
- IHS Mccloskey Coal Group - USA
- Indonesian Coal Mining Association
- Sree Jayajothi Cements Limited - India
- Bhatia International Limited - India
- Bharathi Cement Corporation - India
- Kaltim Prima Coal - Indonesia
- Formosa Plastics Group - Taiwan
- Ambuja Cements Ltd - India
- Agrawal Coal Company - India
- Indian Oil Corporation Limited
- San Jose City I Power Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Cigading International Bulk Terminal - Indonesia
- Indogreen Group - Indonesia
- Economic Council, Georgia
- Larsen & Toubro Limited - India
- Metalloyd Limited - United Kingdom
- Tata Chemicals Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Mintek Dendrill Indonesia
- Aditya Birla Group - India
- PetroVietnam Power Coal Import and Supply Company
- Miang Besar Coal Terminal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Anglo American - United Kingdom
- Wood Mackenzie - Singapore
- SN Aboitiz Power Inc, Philippines
- Rio Tinto Coal - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Price Waterhouse Coopers - Russia
- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Eastern Coal Council - USA
- Savvy Resources Ltd - HongKong
- Carbofer General Trading SA - India
- AsiaOL BioFuels Corp., Philippines
- Petron Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Meralco Power Generation, Philippines
- Deloitte Consulting - India
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Kobexindo Tractors - Indoneisa
- Borneo Indobara - Indonesia
- Wilmar Investment Holdings
- Bahari Cakrawala Sebuku - Indonesia
- Simpson Spence & Young - Indonesia
- Grasim Industreis Ltd - India
- Vedanta Resources Plc - India
- MS Steel International - UAE
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