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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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Saturday, 28 July 12
CAL 2013 COAL SWAPS ARE HIGHER COMPARED TO SEPT 2012 PRICES
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for September 2012 delivery gain 0.47 percent on Friday (27 July 2012) closing DoD but lost 0.90 ...
Friday, 27 July 12
PACIFIC MARKET REMAINED FLAT - FEARNLEYS AS
Handy
The Atlantic market continued its downward trend from last week with what appears to be a summer lull across the board. A trip from the USG t ...
Wednesday, 25 July 12
BUKIT ASAMS H1 REVENUE JUMPED BY 13 PERCENT
COALspot.com - PT Bukit Asam (Persero), Tbk., the state owned coal miner's revenue in H1 2012, has jumped 13 percent to IDR 5.79 trillion (approxim ...
Wednesday, 25 July 12
BUMI RESOURCES MINERALS SECURED PINJAM PAKAI FOR ITS ZINC AND LEAD PROJECT
COALspot.com - PT Bumi Resources Minerals Tbk. ("BRMS" or "the Company") today reported that its 80% owned subsidiary, PT Dairi ...
Tuesday, 24 July 12
SHIP OWNERS WAITING FOR SHIP PRICES TO FALL FURTHER BEFORE MOVING IN MORE AGGRESSIVELY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the summer season already well under way and many ship owners getting ready for the autumn, the sale & purchasing activity of second hand v ...
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- Thai Mozambique Logistica
- Africa Commodities Group - South Africa
- GVK Power & Infra Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Goldman Sachs - Singapore
- CIMB Investment Bank - Malaysia
- Global Business Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Leighton Contractors Pty Ltd - Australia
- San Jose City I Power Corp, Philippines
- Energy Link Ltd, New Zealand
- Aboitiz Power Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Banpu Public Company Limited - Thailand
- Petron Corporation, Philippines
- Siam City Cement - Thailand
- Maharashtra Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Eastern Energy - Thailand
- Simpson Spence & Young - Indonesia
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Trasteel International SA, Italy
- Riau Bara Harum - Indonesia
- SMG Consultants - Indonesia
- Mercuria Energy - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
- Globalindo Alam Lestari - Indonesia
- Sree Jayajothi Cements Limited - India
- Bulk Trading Sa - Switzerland
- Directorate General of MIneral and Coal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Ind-Barath Power Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Kaltim Prima Coal - Indonesia
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- India Bulls Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Bhushan Steel Limited - India
- Australian Coal Association
- Global Coal Blending Company Limited - Australia
- Planning Commission, India
- London Commodity Brokers - England
- PetroVietnam Power Coal Import and Supply Company
- Uttam Galva Steels Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- European Bulk Services B.V. - Netherlands
- Metalloyd Limited - United Kingdom
- Savvy Resources Ltd - HongKong
- CNBM International Corporation - China
- Kohat Cement Company Ltd. - Pakistan
- Timah Investasi Mineral - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Orica Mining Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- Sojitz Corporation - Japan
- Electricity Generating Authority of Thailand
- Meenaskhi Energy Private Limited - India
- Antam Resourcindo - Indonesia
- Chamber of Mines of South Africa
- Minerals Council of Australia
- Singapore Mercantile Exchange
- Coalindo Energy - Indonesia
- Interocean Group of Companies - India
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Central Java Power - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Renaissance Capital - South Africa
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- Vizag Seaport Private Limited - India
- Coal and Oil Company - UAE
- Economic Council, Georgia
- Power Finance Corporation Ltd., India
- Parliament of New Zealand
- Bukit Makmur.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- Marubeni Corporation - India
- SMC Global Power, Philippines
- The University of Queensland
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- Tamil Nadu electricity Board
- Energy Development Corp, Philippines
- VISA Power Limited - India
- Sical Logistics Limited - India
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Therma Luzon, Inc, Philippines
- Edison Trading Spa - Italy
- Alfred C Toepfer International GmbH - Germany
- Wood Mackenzie - Singapore
- Gujarat Sidhee Cement - India
- Jindal Steel & Power Ltd - India
- Latin American Coal - Colombia
- Wilmar Investment Holdings
- New Zealand Coal & Carbon
- Ministry of Mines - Canada
- Price Waterhouse Coopers - Russia
- The Treasury - Australian Government
- Ambuja Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- Gujarat Mineral Development Corp Ltd - India
- Miang Besar Coal Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Central Electricity Authority - India
- TeaM Sual Corporation - Philippines
- PNOC Exploration Corporation - Philippines
- Samtan Co., Ltd - South Korea
- MS Steel International - UAE
- Kepco SPC Power Corporation, Philippines
- Rio Tinto Coal - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Indian Oil Corporation Limited
- Heidelberg Cement - Germany
- Barasentosa Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Altura Mining Limited, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- Port Waratah Coal Services - Australia
- Billiton Holdings Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kideco Jaya Agung - Indonesia
- Lanco Infratech Ltd - India
- IEA Clean Coal Centre - UK
- Xindia Steels Limited - India
- GMR Energy Limited - India
- Pendopo Energi Batubara - Indonesia
- Georgia Ports Authority, United States
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Commonwealth Bank - Australia
- Sindya Power Generating Company Private Ltd
- Posco Energy - South Korea
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- Cement Manufacturers Association - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indonesian Coal Mining Association
- Bayan Resources Tbk. - Indonesia
- Agrawal Coal Company - India
- Larsen & Toubro Limited - India
- Romanian Commodities Exchange
- Grasim Industreis Ltd - India
- Ministry of Transport, Egypt
- GN Power Mariveles Coal Plant, Philippines
- Manunggal Multi Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Mjunction Services Limited - India
- Attock Cement Pakistan Limited
- ICICI Bank Limited - India
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Neyveli Lignite Corporation Ltd, - India
- Straits Asia Resources Limited - Singapore
- Siam City Cement PLC, Thailand
- Deloitte Consulting - India
- Orica Australia Pty. Ltd.
- South Luzon Thermal Energy Corporation
- Australian Commodity Traders Exchange
- Maheswari Brothers Coal Limited - India
- Tata Chemicals Ltd - India
- ASAPP Information Group - India
- Bharathi Cement Corporation - India
- Sakthi Sugars Limited - India
- PowerSource Philippines DevCo
- Oldendorff Carriers - Singapore
- White Energy Company Limited
- Coastal Gujarat Power Limited - India
- Makarim & Taira - Indonesia
- Indogreen Group - Indonesia
- Mercator Lines Limited - India
- Semirara Mining Corp, Philippines
- IHS Mccloskey Coal Group - USA
- Chettinad Cement Corporation Ltd - India
- Madhucon Powers Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Malabar Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Meralco Power Generation, Philippines
- Dalmia Cement Bharat India
- Carbofer General Trading SA - India
- Krishnapatnam Port Company Ltd. - India
- Bangladesh Power Developement Board
- Electricity Authority, New Zealand
- Indika Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Borneo Indobara - Indonesia
- Merrill Lynch Commodities Europe
- Eastern Coal Council - USA
- Bhoruka Overseas - Indonesia
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