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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, 07 July 12
EXCESS SUPPLY & WEAK DEMAND KEEP COAL PRICES LOW
COALspot.com - SGX AsiaClear OTC Coal Swaps for August and Q4 deliveries slipped slightly this week. SGX’s Indonesian sub-bituminous coal swap ...
Saturday, 07 July 12
BALTIC INDEX UP ON STRONG CAPE, PANAMAX RATES - VISTAAR
COALspot.com - This week all the segments were firmed up with BDI up by 15.23 pct (up by 153 points) closing at 1,157 points.
The cape index also ...
Saturday, 07 July 12
DRY BULK MARKET NOT ABLE TO FIND SOLID GROUND SAY EXPERTS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
With the second half of each, traditionally looking the most active one, especially in terms of newbuildings being delivered, it's highly unlikely ...
Thursday, 05 July 12
GOVT GETS READY FOR $1.8B SUIT - THE JAKARTA POST
The Jakarta Post, one of the leading Indonesian English new papers reported that, several ministries and the Attorney General’s Office held a ...
Thursday, 05 July 12
DRY BULK MARKET MOVES FURTHER UP THE HILL - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has kept its growth momentum by the middle of the week, as the BDI (Baltic Dry Index) rose by an additional 40 points to 1,103 p ...
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- Lanco Infratech Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Larsen & Toubro Limited - India
- PTC India Limited - India
- Gujarat Sidhee Cement - India
- Malabar Cements Ltd - India
- Central Java Power - Indonesia
- LBH Netherlands Bv - Netherlands
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- Coal and Oil Company - UAE
- Siam City Cement - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- McConnell Dowell - Australia
- Energy Development Corp, Philippines
- The Treasury - Australian Government
- Barasentosa Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bharathi Cement Corporation - India
- Heidelberg Cement - Germany
- Dalmia Cement Bharat India
- Mercuria Energy - Indonesia
- Economic Council, Georgia
- Vedanta Resources Plc - India
- Krishnapatnam Port Company Ltd. - India
- Thai Mozambique Logistica
- Indo Tambangraya Megah - Indonesia
- Karaikal Port Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- The State Trading Corporation of India Ltd
- Antam Resourcindo - Indonesia
- Sindya Power Generating Company Private Ltd
- San Jose City I Power Corp, Philippines
- Leighton Contractors Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- Makarim & Taira - Indonesia
- Uttam Galva Steels Limited - India
- Ambuja Cements Ltd - India
- GVK Power & Infra Limited - India
- Sree Jayajothi Cements Limited - India
- Energy Link Ltd, New Zealand
- Global Green Power PLC Corporation, Philippines
- SMG Consultants - Indonesia
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- Therma Luzon, Inc, Philippines
- Ministry of Transport, Egypt
- Kaltim Prima Coal - Indonesia
- Iligan Light & Power Inc, Philippines
- Electricity Authority, New Zealand
- Borneo Indobara - Indonesia
- Central Electricity Authority - India
- Australian Coal Association
- Ministry of Mines - Canada
- Kideco Jaya Agung - Indonesia
- Riau Bara Harum - Indonesia
- Sakthi Sugars Limited - India
- Sarangani Energy Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Goldman Sachs - Singapore
- Jaiprakash Power Ventures ltd
- Essar Steel Hazira Ltd - India
- Siam City Cement PLC, Thailand
- Directorate Of Revenue Intelligence - India
- Parry Sugars Refinery, India
- Jorong Barutama Greston.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- Standard Chartered Bank - UAE
- Mintek Dendrill Indonesia
- Bhatia International Limited - India
- Coastal Gujarat Power Limited - India
- Gujarat Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- Alfred C Toepfer International GmbH - Germany
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Metalloyd Limited - United Kingdom
- Bukit Makmur.PT - Indonesia
- Wood Mackenzie - Singapore
- Wilmar Investment Holdings
- Marubeni Corporation - India
- Toyota Tsusho Corporation, Japan
- Miang Besar Coal Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- Intertek Mineral Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Salva Resources Pvt Ltd - India
- Global Business Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Deloitte Consulting - India
- IEA Clean Coal Centre - UK
- Renaissance Capital - South Africa
- Tamil Nadu electricity Board
- CNBM International Corporation - China
- Neyveli Lignite Corporation Ltd, - India
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Trasteel International SA, Italy
- Samtan Co., Ltd - South Korea
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Bhoruka Overseas - Indonesia
- VISA Power Limited - India
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- Petron Corporation, Philippines
- Independent Power Producers Association of India
- Cement Manufacturers Association - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- White Energy Company Limited
- Commonwealth Bank - Australia
- Pendopo Energi Batubara - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sojitz Corporation - Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Australian Commodity Traders Exchange
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Indonesian Coal Mining Association
- Aboitiz Power Corporation - Philippines
- New Zealand Coal & Carbon
- Kohat Cement Company Ltd. - Pakistan
- International Coal Ventures Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Ind-Barath Power Infra Limited - India
- South Luzon Thermal Energy Corporation
- Maharashtra Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Chettinad Cement Corporation Ltd - India
- Timah Investasi Mineral - Indoneisa
- Electricity Generating Authority of Thailand
- Altura Mining Limited, Indonesia
- Straits Asia Resources Limited - Singapore
- Xindia Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- London Commodity Brokers - England
- ASAPP Information Group - India
- Attock Cement Pakistan Limited
- Romanian Commodities Exchange
- Latin American Coal - Colombia
- GN Power Mariveles Coal Plant, Philippines
- Meralco Power Generation, Philippines
- Bhushan Steel Limited - India
- Kapuas Tunggal Persada - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Power Finance Corporation Ltd., India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bayan Resources Tbk. - Indonesia
- Mercator Lines Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Finance - Indonesia
- Grasim Industreis Ltd - India
- Indika Energy - Indonesia
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- SMC Global Power, Philippines
- Orica Mining Services - Indonesia
- Global Coal Blending Company Limited - Australia
- Planning Commission, India
- Rio Tinto Coal - Australia
- Orica Australia Pty. Ltd.
- Anglo American - United Kingdom
- OPG Power Generation Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Simpson Spence & Young - Indonesia
- TeaM Sual Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Globalindo Alam Lestari - Indonesia
- Singapore Mercantile Exchange
- Eastern Energy - Thailand
- MS Steel International - UAE
- Indian Energy Exchange, India
- Kobexindo Tractors - Indoneisa
- Georgia Ports Authority, United States
- Aditya Birla Group - India
- Formosa Plastics Group - Taiwan
- Indogreen Group - Indonesia
- ICICI Bank Limited - India
- Coalindo Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Mjunction Services Limited - India
- Baramulti Group, Indonesia
- Star Paper Mills Limited - India
- Rashtriya Ispat Nigam Limited - India
- Agrawal Coal Company - India
- Vizag Seaport Private Limited - India
- GMR Energy Limited - India
- Kepco SPC Power Corporation, Philippines
- PowerSource Philippines DevCo
- The University of Queensland
- Price Waterhouse Coopers - Russia
- Videocon Industries ltd - India
- Sical Logistics Limited - India
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