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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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Monday, 13 February 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
The current sentiment in the dry market resembles memories from the end of 2008, when the Baltic Dry Index closed at the level of 663 points on Dece ...
Sunday, 12 February 12
INDONESIA HAS ISSUED A REGULATION TO BAN THE EXPORT OF UNPROCESSED MINERALS AND METALS BY 2014
COALspot.com - The Indonesian government has finally issued a ministerial decree (7 Year 2012 dated 6 February 2012) to ban the export of unpro ...
Sunday, 12 February 12
THE BALTIC DRY INDEX CLIMBS 10.51%
COALspot.com - "The markets touched record lows not seen since mid 80’s. However there was some good news with signs of market recovery a ...
Saturday, 11 February 12
A SNAPSHOT ON THE ECONOMIC AND SHIPPING ENVIRONMENT - GOLDEN DESTINY
The week was highlighted with intense worries in the eurozone for Greece to secure its second bailout of $130billion by applying a ...
Saturday, 11 February 12
WILL HISTORY REPEAT ITSELF IN THIS SHIPPING CYCLE? - CLARKSONS / HELLENIC SHIPPING
A slightly dubious "best man" joke runs as follows… Best man (giving his wedding speech): "Have you noticed how history repeat ...
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- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Sakthi Sugars Limited - India
- Bharathi Cement Corporation - India
- Salva Resources Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- CNBM International Corporation - China
- The State Trading Corporation of India Ltd
- Dalmia Cement Bharat India
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Bahari Cakrawala Sebuku - Indonesia
- Bulk Trading Sa - Switzerland
- Xindia Steels Limited - India
- CIMB Investment Bank - Malaysia
- Star Paper Mills Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Wood Mackenzie - Singapore
- Pendopo Energi Batubara - Indonesia
- Tata Chemicals Ltd - India
- Posco Energy - South Korea
- International Coal Ventures Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Bangladesh Power Developement Board
- Riau Bara Harum - Indonesia
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Global Business Power Corporation, Philippines
- Eastern Coal Council - USA
- Billiton Holdings Pty Ltd - Australia
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Bhatia International Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Indian Oil Corporation Limited
- Heidelberg Cement - Germany
- IHS Mccloskey Coal Group - USA
- Directorate General of MIneral and Coal - Indonesia
- Coal and Oil Company - UAE
- Rashtriya Ispat Nigam Limited - India
- OPG Power Generation Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- SN Aboitiz Power Inc, Philippines
- Intertek Mineral Services - Indonesia
- VISA Power Limited - India
- Alfred C Toepfer International GmbH - Germany
- Meralco Power Generation, Philippines
- Bhushan Steel Limited - India
- Uttam Galva Steels Limited - India
- Asmin Koalindo Tuhup - Indonesia
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Tamil Nadu electricity Board
- Semirara Mining and Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Africa Commodities Group - South Africa
- MS Steel International - UAE
- SMG Consultants - Indonesia
- Savvy Resources Ltd - HongKong
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- Meenaskhi Energy Private Limited - India
- Wilmar Investment Holdings
- Aboitiz Power Corporation - Philippines
- Planning Commission, India
- Jindal Steel & Power Ltd - India
- Anglo American - United Kingdom
- Sree Jayajothi Cements Limited - India
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Thiess Contractors Indonesia
- Electricity Generating Authority of Thailand
- Indo Tambangraya Megah - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- PowerSource Philippines DevCo
- Deloitte Consulting - India
- TNB Fuel Sdn Bhd - Malaysia
- Georgia Ports Authority, United States
- European Bulk Services B.V. - Netherlands
- Parliament of New Zealand
- SMC Global Power, Philippines
- New Zealand Coal & Carbon
- Global Green Power PLC Corporation, Philippines
- Medco Energi Mining Internasional
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Global Coal Blending Company Limited - Australia
- Independent Power Producers Association of India
- Holcim Trading Pte Ltd - Singapore
- Goldman Sachs - Singapore
- Iligan Light & Power Inc, Philippines
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Port Waratah Coal Services - Australia
- Kideco Jaya Agung - Indonesia
- Grasim Industreis Ltd - India
- Australian Commodity Traders Exchange
- Petron Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- PNOC Exploration Corporation - Philippines
- Standard Chartered Bank - UAE
- LBH Netherlands Bv - Netherlands
- San Jose City I Power Corp, Philippines
- Economic Council, Georgia
- Trasteel International SA, Italy
- Binh Thuan Hamico - Vietnam
- Karbindo Abesyapradhi - Indoneisa
- Indika Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- Ministry of Finance - Indonesia
- Sinarmas Energy and Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- London Commodity Brokers - England
- Indogreen Group - Indonesia
- Energy Link Ltd, New Zealand
- Mercator Lines Limited - India
- Kobexindo Tractors - Indoneisa
- Gujarat Sidhee Cement - India
- Marubeni Corporation - India
- Orica Mining Services - Indonesia
- Commonwealth Bank - Australia
- Neyveli Lignite Corporation Ltd, - India
- Mercuria Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- Leighton Contractors Pty Ltd - Australia
- Aditya Birla Group - India
- Orica Australia Pty. Ltd.
- Madhucon Powers Ltd - India
- Interocean Group of Companies - India
- Larsen & Toubro Limited - India
- Kartika Selabumi Mining - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- Central Java Power - Indonesia
- Mjunction Services Limited - India
- Karaikal Port Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Indonesian Coal Mining Association
- IEA Clean Coal Centre - UK
- Gujarat Electricity Regulatory Commission - India
- Timah Investasi Mineral - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- Sindya Power Generating Company Private Ltd
- Antam Resourcindo - Indonesia
- Minerals Council of Australia
- Baramulti Group, Indonesia
- Samtan Co., Ltd - South Korea
- Bhoruka Overseas - Indonesia
- Australian Coal Association
- GMR Energy Limited - India
- Vizag Seaport Private Limited - India
- Siam City Cement - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Therma Luzon, Inc, Philippines
- Metalloyd Limited - United Kingdom
- Kepco SPC Power Corporation, Philippines
- Videocon Industries ltd - India
- Mintek Dendrill Indonesia
- Indian Energy Exchange, India
- Coalindo Energy - Indonesia
- Carbofer General Trading SA - India
- Electricity Authority, New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ambuja Cements Ltd - India
- Thai Mozambique Logistica
- Banpu Public Company Limited - Thailand
- Central Electricity Authority - India
- Chettinad Cement Corporation Ltd - India
- GVK Power & Infra Limited - India
- Energy Development Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Ministry of Mines - Canada
- Rio Tinto Coal - Australia
- Singapore Mercantile Exchange
- Price Waterhouse Coopers - Russia
- Kaltim Prima Coal - Indonesia
- Lanco Infratech Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ind-Barath Power Infra Limited - India
- Vedanta Resources Plc - India
- India Bulls Power Limited - India
- Bukit Makmur.PT - Indonesia
- South Luzon Thermal Energy Corporation
- Toyota Tsusho Corporation, Japan
- Renaissance Capital - South Africa
- Krishnapatnam Port Company Ltd. - India
- Cigading International Bulk Terminal - Indonesia
- The University of Queensland
- Kumho Petrochemical, South Korea
- Eastern Energy - Thailand
- The Treasury - Australian Government
- Straits Asia Resources Limited - Singapore
- PTC India Limited - India
- Borneo Indobara - Indonesia
- Maheswari Brothers Coal Limited - India
- Jaiprakash Power Ventures ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- McConnell Dowell - Australia
- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement PLC, Thailand
- ICICI Bank Limited - India
- Latin American Coal - Colombia
- Sical Logistics Limited - India
- Altura Mining Limited, Indonesia
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