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Friday, 06 April 12
DRY BULK MARKET SWIFT TO HALT FALL ON RENEWED DEMAND FOR CAPESIZES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
 The dry bulk managed to put a stop to the recent falls, which came as a result of a lacklustre demand for smaller vessel sizes. Although this trend has remained the same, the return of Chinese charterers from their three-day holidays marked a stronger demand for Capesizes yesterday, which in turn was enough to offset the lack of interest for smaller vessels and lead the market to higher ground. The Baltic Dry Index (BDI) was up by 0..22% to 928 points yesterday, with Capesizes gaining 2.17% on the day and reaching 1,507 points. By contrast, the demise of the Supramax market was again evident, with the relative index losing 1.66%, while Panamaxes were also down by 0.67%.
Detailing the oversupply issues which have caused the dry bulk market to retreat to such low levels since the start of the year, Intermodal’s Theodore Ntalakos said that “the freight market and other circumstances were quite convenient for many shipowners who while acting independently and rationally consulting their own self-interest, ordered new buildings even when it was clear that in the long-term the excessive tonnage would eventually suffocate the freight market. It is a real-life example of game theory that shows why two or more individuals might not cooperate, even if it is in their best interest to do so” said Mr. Ntalakos.
He went on to give an example to make his case. “Say we have one shipowner ( Shipowner A) and all the rest shipowners (Shipowner B). Each of their strategy is either to expand by ordering the new fuel efficient vessels or not to order and buy a vessel from the second hand market. We have four possible scenarios:
I. If Shipowner A orders and no one else does then he will get the benefit of new designs, and earn say $10, B stays behind and earns $1
II. If both A and B order then they lose the advantage and they earn very little - $2,
III. If no one orders then they earn moderately from their existing fleet - $5 each, and
IV. If shipowner A does not order but 'B' orders then 'A' will earn very little because the charterers will prefer B's ECO ships – A earns $1, B earns $10.
Here, regardless of what the other decides, each shipowner gets a higher pay-off by ordering new vessels:
I. If B does not order, the payoffs for A are $5 or $10 so he will always chose $10 i.e to order.
II. If B orders, the payoffs for A are $1 or $2 so he will always chose $2 i.e to order
The game is symmetric so Shipower B would always act the same way which means that both shipowers would order new vessels. Since both rational owners decide to order new vessels each receives a lower reward than if both were not to order!! So, rational decision-making results being worse off than if each chose not to order and accept to earn less. As the two shipowners can’t see what the others are doing and cannot play a cooperative game, they will decide to maximize their pay-off and always proceed with orders” said Mr. Ntalakos in a rather interesting undertaking.
He concluded his analysis by stating “we need however to point out that the new ECO ships especially with the current restrain on finance, will only be a small part of the total fleet and orderbook and it will take years to play a substantial part and drive the older vessels out of the market, so we expect owners who order such vessels with today's new builiding and bunker prices to have the competitive advantage for the years to come.
So, there you have it, Shipping is a non-cooperative game. Then why do pools exist? Even in pools if each member's interest to put the next (and succeeding) vessel he acquires into the pool and the demand is limited then the quality of the common is damaged for everybody. So like everything else in life one needs to find the proper equilibrium between cooperating and looking after one's self-interest” he said.
Source: Nikos Roussanoglou, Hellenic Shipping
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Wednesday, 29 August 12
COLOMBIA'S MINING BOOM: PART ONE - JOSEPH KIRSCHKE
COALspot.com - Colombia stands before one of the potentially largest, most diversified mining booms in the world. Untold reserves of gold, coal, cop ...
Wednesday, 29 August 12
SECOND HAND VESSELS IN HIGH DEMAND DESPITE SUMMER SEASON - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Despite the slow summer season, ship owners appear to be rather keen in acquiring some modern second hand tonnage at "knock-down" prices. ...
Monday, 27 August 12
BUMI BOOKS $322.1 MILLION NET LOSS IN 1H 2012 IN SPITE OF 8.6 PERCENT INCREASE IN SALES REVENUE
PT Bumi Resources Tbk, the single largest coal producer and exporter in Indonesia announces its first half financial report for the ...
Monday, 27 August 12
OVER 200 FOREIGN COMPANIES AND ENERGY MAJORS EXPECTED AT 2ND MOGP SUMMIT IN YANGON
Singapore based CMT and Machinery & Solutions Co. Ltd (M&S) announce that the 2nd MOGP Summit will be held on 3-6 September at the Sedona ho ...
Sunday, 26 August 12
SOUTH AFRICAN COAL OVERVIEW
South Africa's indigenous energy resource base is dominated by coal.
Internationally, coal is the most widely used primary fuel, accounting for ...
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- Indian Oil Corporation Limited
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- Ministry of Transport, Egypt
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- Semirara Mining Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Energy Link Ltd, New Zealand
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- Toyota Tsusho Corporation, Japan
- Romanian Commodities Exchange
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- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Central Electricity Authority - India
- Ministry of Finance - Indonesia
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- Jindal Steel & Power Ltd - India
- Latin American Coal - Colombia
- Riau Bara Harum - Indonesia
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- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- GMR Energy Limited - India
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- Bhushan Steel Limited - India
- Iligan Light & Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Orica Mining Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- South Luzon Thermal Energy Corporation
- Videocon Industries ltd - India
- Planning Commission, India
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- Indogreen Group - Indonesia
- The Treasury - Australian Government
- Orica Australia Pty. Ltd.
- Asmin Koalindo Tuhup - Indonesia
- Vizag Seaport Private Limited - India
- Larsen & Toubro Limited - India
- IEA Clean Coal Centre - UK
- Ministry of Mines - Canada
- Chettinad Cement Corporation Ltd - India
- Merrill Lynch Commodities Europe
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- The University of Queensland
- Mintek Dendrill Indonesia
- CIMB Investment Bank - Malaysia
- Directorate Of Revenue Intelligence - India
- Tata Chemicals Ltd - India
- Anglo American - United Kingdom
- Bangladesh Power Developement Board
- Bhatia International Limited - India
- Krishnapatnam Port Company Ltd. - India
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- PowerSource Philippines DevCo
- Binh Thuan Hamico - Vietnam
- Semirara Mining and Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- Straits Asia Resources Limited - Singapore
- GN Power Mariveles Coal Plant, Philippines
- PNOC Exploration Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Singapore Mercantile Exchange
- Malabar Cements Ltd - India
- Aditya Birla Group - India
- PetroVietnam Power Coal Import and Supply Company
- Makarim & Taira - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indian Energy Exchange, India
- Samtan Co., Ltd - South Korea
- Australian Commodity Traders Exchange
- Thai Mozambique Logistica
- Global Green Power PLC Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Antam Resourcindo - Indonesia
- Simpson Spence & Young - Indonesia
- Edison Trading Spa - Italy
- Bukit Baiduri Energy - Indonesia
- Eastern Coal Council - USA
- Rio Tinto Coal - Australia
- Meenaskhi Energy Private Limited - India
- Independent Power Producers Association of India
- Port Waratah Coal Services - Australia
- Parry Sugars Refinery, India
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- Wood Mackenzie - Singapore
- McConnell Dowell - Australia
- Xindia Steels Limited - India
- GAC Shipping (India) Pvt Ltd
- Gujarat Sidhee Cement - India
- MS Steel International - UAE
- ICICI Bank Limited - India
- Ceylon Electricity Board - Sri Lanka
- Petrochimia International Co. Ltd.- Taiwan
- Formosa Plastics Group - Taiwan
- New Zealand Coal & Carbon
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Coal and Oil Company - UAE
- European Bulk Services B.V. - Netherlands
- Maheswari Brothers Coal Limited - India
- Standard Chartered Bank - UAE
- Global Coal Blending Company Limited - Australia
- Globalindo Alam Lestari - Indonesia
- Dalmia Cement Bharat India
- Coalindo Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- ASAPP Information Group - India
- Sinarmas Energy and Mining - Indonesia
- Petron Corporation, Philippines
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Attock Cement Pakistan Limited
- Medco Energi Mining Internasional
- Ambuja Cements Ltd - India
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- Commonwealth Bank - Australia
- Chamber of Mines of South Africa
- Mjunction Services Limited - India
- Carbofer General Trading SA - India
- Kideco Jaya Agung - Indonesia
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Gujarat Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- Kaltim Prima Coal - Indonesia
- Barasentosa Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Cement Manufacturers Association - India
- Minerals Council of Australia
- Jorong Barutama Greston.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Miang Besar Coal Terminal - Indonesia
- Star Paper Mills Limited - India
- Madhucon Powers Ltd - India
- Indika Energy - Indonesia
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- Economic Council, Georgia
- Kalimantan Lumbung Energi - Indonesia
- SMC Global Power, Philippines
- International Coal Ventures Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- TeaM Sual Corporation - Philippines
- PTC India Limited - India
- Billiton Holdings Pty Ltd - Australia
- Essar Steel Hazira Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- The State Trading Corporation of India Ltd
- Trasteel International SA, Italy
- Vijayanagar Sugar Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Agrawal Coal Company - India
- Electricity Authority, New Zealand
- Australian Coal Association
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