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