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Monday, 05 March 12
WEEKLY DRY MARKET OVERVIEW - MARIA BERTZELETOU, HELLENIC SHIPPING
 An air of optimism poured in the market this week for dry bulk shippers with the Baltic Dry Index recording daily gains during the end of February by rising for the seventh straight day and closing at 771 points, up by 53 points or 7.38% from last Friday’s closing. All the indexes reflecting daily freight market rates for capesize, panamax, supramax and handysize dry bulk vessels closed in green with smaller sized vessels, supramax and handysize, showing the largest week-on-week increase, 12.54% and 10.63% respectively in contrast with a 1.40% and 0.96% rise for capesize and panamax vessels respectively. There are increasing doubts if this recent euphoria will stay since there are many newbuildings on stream and panamax ship operators are already experiencing severe pains from continuous deliveries with gloomy predictions for China’s economic growth, the main demand driver for raw materials’ transportation.
For large sized vessels, capesizes, which typically transport 150,000 ton cargoes of iron ore and coal, the market remains largely flat with the BCI gaining 21 points on a weekly basis, up by 1.4% standing at 1525 points, whereas average daily earnings are floating at levels below those for handysize units, less than $6,000/day. The over abundance of ships and the limited inquiry in the Atlantic market persist to distress capesize operators’ financial performance with earnings below breakeven levels. Spot and period chartering activity is piecemeal with a vessel of 150,000 tons rumored to have been fixed for an east coast Australian round at $7,000/day. In the period market, a 169,000 tons vessel is said to have booked from China for 4 to 7 months at $12,300/daily.
The capesize segment is still very fragile as Chinese have not fully regained their iron ore buying appetite with hefty iron ore inventories. Chinese steel production has found a small amount of support but remains relative low. The China Iron & Steel Association reported that daily crude steel production averaged approximately 1,71 million tons from February 1 to February 10. This is an increase of 2% from the 1,67mt average daily steel production occurred during January 21 to January 31, but down significantly from last year’s record 2,02mt average daily production during June 21 to June 30. Spot iron ore prices are on rise, near to $140/tonne, on a rebound of Chinese demand ahead of construction projects restarts in March. Estimations for a decline in Chinese iron ore imports for 2012 would be a highly negative development for capesize earnings. According to China Mining Association, China may import as much as 14% less of the steelmaking raw material this year as domestic production increases. Imports may be between 590 million metric tons and 650 million tons this year, while last year’s imports were 686 million tons, according to Bloomberg calculations based on General Customs data.
The panamax market appears to be in a better condition as China’s coal demand appears more supportive and average daily earnings are above $6,500, when last year vessels were earning more than doubled. Panamax operators are also facing serious issues from vessel oversupply and strong South American grain demand adds a beneficiary key factor for the healthy performance of earnings. There was said to be a healthy list of cargoes, but rates have hardly moved as charterers could pick from ships coming from the Continent, Mediterranean, the Indian Ocean and Southeast Asia. The BPI gained only 8 points from last week’s closing, up by 0.96% and standing at 844 points.
China’s thermal coal market has shown weakness amid expectations for an upward movement in March that drags vessels earnings below $10,000/day. With coal stocks remaining high at both Chinese power plants and coal ports, a Beijing-based trader said the Chinese coal market is likely to remain slack for the next couple of weeks. Coal stocks at China's key power plants totaled 74.45 million mt on February 20, able to last for about 20 days of burning, according to figures from the National Development and Reform Commission. However, the recent drops in coal stocks at coastal ports, together with the month-long overhaul of the Datong-Qinhuangdao railroad rumored to be starting in mid-March, may end the weakness in China's coal market, market sources said. Fangcheng Port in southern China's Guangxi Zhuang Autonomous Region is reported to be holding slightly over 6 million mt of coal and incoming coal vessels have to wait for about a week before they can be unloaded. "Not only Fangcheng Port, other major coal ports also see their stockyards packed," a Shandong-based trader said.
Supramax vessels, which carry about 25 percent less than panamaxes, showed the strongest performance this week with the BSI gaining 83 points, up by 12.5% from last week’s closing and standing at 745 points. Average daily earnings are above $7,700, but 50% lower than last year with the Atlantic market still being distressed. In the Pacific, the south-east Asia mineral trades, including a significant amount of nickel ore business, has been driving the recent improvement. A vessel of 55,000dwt built 2005 is said to have been fixed for a trip via Indonesia to India at $14,500 daily.
In addition, handysize units gained for a second consecutive week a sharp increase of 10.6% with the BHSI standing at 437and earnings rising to $6,630/day, almost 37% lower than previous year when they were earning $10,481/day.
The weak performance of capesize segment troubles the dry bulk industry with the BDI crawling to move at levels of one year ago and break the barrier of 1,000 points. China, the world’s second largest economy and the largest importer of iron ore and coal, has shown signs of negative economic growth with the World Bank estimating that China’s GDP annual growth will decline to 5.9% by 2021 after three decades of 10% average annual growth. The critical issue is if China would be the massive buying power for dry bulk materials, in the forthcoming years, to support and absorb the ample tonnage of ships in the market. A negative catalyst factor is China’s target to achieve iron ore self efficiency. According to the China Iron & Steel Association, China is aiming to improve its self efficiency in iron ore and continue to consolidate the steel industry in a bid to raise the output of its major steel makers by 10% within the next four years. The government expects the country’s top 10 steel manufacturers to account for 60% of the country’s steel output by 2015, Wang Xiaoqi, CISA vice chairman, said at a trade conference held in Beijing.
However, players haven’t lost their shipping confidence with mounting hopes for a firmer return of the market after the end of the first quarter of the year as Chinese steel mills are restocking on iron ore and they slowly increase steel output during the seasonally busy periods of March and April for the construction and manufacturing sectors.
Source: Maria Bertzeletou, Hellenic Shipping
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Monday, 05 March 12
SOUTHGOBI ANNOUNCES AGREEMENT TO SELL ITS THERMAL COAL TSAGAAN TOLGOI DEPOSIT FOR US$ 30 MILLION
SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) announced today an agreement to sell its thermal coal property, the Tsagaan Tolgoi Deposit to Modun Re ...
Monday, 05 March 12
SOME RESOURCE TITANS NOT THRILLED WITH INDONESIAN EXPORT BAN - THE JAKARTA GLOBE
The Jakarta Globe reported that, local representatives of major business associations in East Kalimantan have protested a government regulation that ...
Sunday, 04 March 12
SE ASIA WAS FIRM FOR TRIPS TO INDIA AND CHINA - VISTAAR
COALspot.com - This week saw another upward trend with all indices up and generally market was firm.
The BDI was up by 7.38 pct closing at 771 po ...
Friday, 02 March 12
DJMBP HAS ANNOUNCED SECOND BATCH OF CLEAR N CLEAN CERTIFIED MINERS
COALspot.com - The Directorate general of mineral & coal of Indonesia has announced second batch of companies who have passed IUP Clear and Clea ...
Thursday, 01 March 12
BUKIT ASAM TARGETS EUROPEAN INVESTORS
COALspot.com - PT. Bukit Asam (persero) Tbk, Indonesian state owned coal miner is planning to conduct road show in Europe next week to target at Eur ...
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- The State Trading Corporation of India Ltd
- Kapuas Tunggal Persada - Indonesia
- Dalmia Cement Bharat India
- Formosa Plastics Group - Taiwan
- Port Waratah Coal Services - Australia
- Eastern Energy - Thailand
- Barasentosa Lestari - Indonesia
- Siam City Cement - Thailand
- Tata Chemicals Ltd - India
- Indo Tambangraya Megah - Indonesia
- Petron Corporation, Philippines
- Ambuja Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Latin American Coal - Colombia
- Independent Power Producers Association of India
- GN Power Mariveles Coal Plant, Philippines
- Asmin Koalindo Tuhup - Indonesia
- ICICI Bank Limited - India
- Timah Investasi Mineral - Indoneisa
- Banpu Public Company Limited - Thailand
- Global Business Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- CNBM International Corporation - China
- Krishnapatnam Port Company Ltd. - India
- OPG Power Generation Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Indian Energy Exchange, India
- The Treasury - Australian Government
- London Commodity Brokers - England
- Sree Jayajothi Cements Limited - India
- PowerSource Philippines DevCo
- Bharathi Cement Corporation - India
- Salva Resources Pvt Ltd - India
- Mjunction Services Limited - India
- Xindia Steels Limited - India
- Wilmar Investment Holdings
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Malabar Cements Ltd - India
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Thiess Contractors Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Energy Development Corp, Philippines
- Alfred C Toepfer International GmbH - Germany
- Iligan Light & Power Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Kideco Jaya Agung - Indonesia
- Kumho Petrochemical, South Korea
- Makarim & Taira - Indonesia
- Metalloyd Limited - United Kingdom
- Larsen & Toubro Limited - India
- Global Green Power PLC Corporation, Philippines
- Merrill Lynch Commodities Europe
- Sical Logistics Limited - India
- Economic Council, Georgia
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Central Java Power - Indonesia
- IHS Mccloskey Coal Group - USA
- Semirara Mining and Power Corporation, Philippines
- Simpson Spence & Young - Indonesia
- Agrawal Coal Company - India
- SN Aboitiz Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Parliament of New Zealand
- Electricity Generating Authority of Thailand
- Sojitz Corporation - Japan
- Pendopo Energi Batubara - Indonesia
- Ministry of Finance - Indonesia
- Interocean Group of Companies - India
- Georgia Ports Authority, United States
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Bukit Baiduri Energy - Indonesia
- Romanian Commodities Exchange
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Thai Mozambique Logistica
- Directorate Of Revenue Intelligence - India
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- European Bulk Services B.V. - Netherlands
- Orica Mining Services - Indonesia
- Australian Commodity Traders Exchange
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- Mercator Lines Limited - India
- ASAPP Information Group - India
- Uttam Galva Steels Limited - India
- Videocon Industries ltd - India
- Bhoruka Overseas - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Indika Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- Kepco SPC Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- LBH Netherlands Bv - Netherlands
- PNOC Exploration Corporation - Philippines
- Electricity Authority, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Straits Asia Resources Limited - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Vizag Seaport Private Limited - India
- Ind-Barath Power Infra Limited - India
- Borneo Indobara - Indonesia
- Jindal Steel & Power Ltd - India
- Bhushan Steel Limited - India
- Price Waterhouse Coopers - Russia
- Kobexindo Tractors - Indoneisa
- Bhatia International Limited - India
- Minerals Council of Australia
- Karaikal Port Pvt Ltd - India
- Lanco Infratech Ltd - India
- AsiaOL BioFuels Corp., Philippines
- MS Steel International - UAE
- Singapore Mercantile Exchange
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- New Zealand Coal & Carbon
- Billiton Holdings Pty Ltd - Australia
- Miang Besar Coal Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Sakthi Sugars Limited - India
- SMG Consultants - Indonesia
- Tamil Nadu electricity Board
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Chamber of Mines of South Africa
- Indonesian Coal Mining Association
- Orica Australia Pty. Ltd.
- Maharashtra Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Maheswari Brothers Coal Limited - India
- Riau Bara Harum - Indonesia
- Sindya Power Generating Company Private Ltd
- Kalimantan Lumbung Energi - Indonesia
- Commonwealth Bank - Australia
- Power Finance Corporation Ltd., India
- Indogreen Group - Indonesia
- Ministry of Mines - Canada
- Leighton Contractors Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- GMR Energy Limited - India
- Standard Chartered Bank - UAE
- San Jose City I Power Corp, Philippines
- Vedanta Resources Plc - India
- Bangladesh Power Developement Board
- Star Paper Mills Limited - India
- International Coal Ventures Pvt Ltd - India
- Central Electricity Authority - India
- Energy Link Ltd, New Zealand
- Meralco Power Generation, Philippines
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- GVK Power & Infra Limited - India
- South Luzon Thermal Energy Corporation
- Jorong Barutama Greston.PT - Indonesia
- Coastal Gujarat Power Limited - India
- Jaiprakash Power Ventures ltd
- Rio Tinto Coal - Australia
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Kaltim Prima Coal - Indonesia
- Trasteel International SA, Italy
- Globalindo Alam Lestari - Indonesia
- Carbofer General Trading SA - India
- Gujarat Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Kartika Selabumi Mining - Indonesia
- Intertek Mineral Services - Indonesia
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- Savvy Resources Ltd - HongKong
- Samtan Co., Ltd - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Planning Commission, India
- Therma Luzon, Inc, Philippines
- Mintek Dendrill Indonesia
- Bayan Resources Tbk. - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Antam Resourcindo - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Mercuria Energy - Indonesia
- Essar Steel Hazira Ltd - India
- Deloitte Consulting - India
- Gujarat Sidhee Cement - India
- Karbindo Abesyapradhi - Indoneisa
- TeaM Sual Corporation - Philippines
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- Altura Mining Limited, Indonesia
- Coalindo Energy - Indonesia
- Madhucon Powers Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Aboitiz Power Corporation - Philippines
- VISA Power Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
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