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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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Friday, 01 June 12
COKAL ACCEPTED ON THE CLEAN AND CLEAR LIST FOR ITS BORNEO BARA PRIMA AND BUMI BARITO MINERAL PROJECTS
- Borneo Bara Prima (BBP) Project confirmed on the Clean and Clear List 9th May 2012
- Bumi Barito Mineral (BBM) Project confirmed on the Clean and ...
Friday, 01 June 12
ADARO BUYS MAJORITY STAKE IN AFFILIATED BHAKTI ENERGI - INSIDER STORIES
Insider Stories reported that, PT Adaro Energy Tbk entered into an option to provide a convertible loan of up to US$500 million for a period of 3 ye ...
Thursday, 31 May 12
DRY BULK MARKET UNABLE TO FIND NEW SUPPORT TO REACH HIGHER LEVELS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been unable to find new support and recover to higher levels during these past few days. As a result, the Baltic Dry Index ( ...
Wednesday, 30 May 12
ORPHEUS RAISES $2.24M TO ADVANCE INDONESIAN COAL PRODUCTION ASSETS
• $2.24 million raised from a placement to new and existing institutional and sophisticated investors from Australia and overseas
• Funds ...
Wednesday, 30 May 12
ARPENI SECURES TRANSSHIPMENT CONTRACT FROM BARUNA DIRGA
Insider Stories reported that, shipping operator PT Arpeni Pratama Ocean Line Tbk (APOL) has secured a 1-year coal transhipment contract of 4 millio ...
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- Anglo American - United Kingdom
- VISA Power Limited - India
- Xindia Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Semirara Mining Corp, Philippines
- Sakthi Sugars Limited - India
- Rio Tinto Coal - Australia
- Baramulti Group, Indonesia
- Ind-Barath Power Infra Limited - India
- PTC India Limited - India
- Bhushan Steel Limited - India
- Meenaskhi Energy Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Salva Resources Pvt Ltd - India
- Wood Mackenzie - Singapore
- Bayan Resources Tbk. - Indonesia
- CIMB Investment Bank - Malaysia
- Kepco SPC Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Tata Chemicals Ltd - India
- Eastern Coal Council - USA
- Antam Resourcindo - Indonesia
- Sical Logistics Limited - India
- SMG Consultants - Indonesia
- Bulk Trading Sa - Switzerland
- GAC Shipping (India) Pvt Ltd
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Price Waterhouse Coopers - Russia
- Jindal Steel & Power Ltd - India
- San Jose City I Power Corp, Philippines
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Central Electricity Authority - India
- Trasteel International SA, Italy
- Videocon Industries ltd - India
- Sree Jayajothi Cements Limited - India
- Therma Luzon, Inc, Philippines
- Ministry of Transport, Egypt
- Globalindo Alam Lestari - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Ministry of Finance - Indonesia
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Marubeni Corporation - India
- Kartika Selabumi Mining - Indonesia
- Makarim & Taira - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- TeaM Sual Corporation - Philippines
- Orica Australia Pty. Ltd.
- Thiess Contractors Indonesia
- Orica Mining Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Simpson Spence & Young - Indonesia
- Indika Energy - Indonesia
- GMR Energy Limited - India
- GVK Power & Infra Limited - India
- IHS Mccloskey Coal Group - USA
- New Zealand Coal & Carbon
- Coalindo Energy - Indonesia
- Attock Cement Pakistan Limited
- Indian Energy Exchange, India
- London Commodity Brokers - England
- India Bulls Power Limited - India
- The University of Queensland
- Power Finance Corporation Ltd., India
- Vizag Seaport Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Global Coal Blending Company Limited - Australia
- Formosa Plastics Group - Taiwan
- Energy Development Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Tamil Nadu electricity Board
- Toyota Tsusho Corporation, Japan
- Independent Power Producers Association of India
- Directorate Of Revenue Intelligence - India
- Samtan Co., Ltd - South Korea
- Medco Energi Mining Internasional
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- Miang Besar Coal Terminal - Indonesia
- Dalmia Cement Bharat India
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Mines - Canada
- Standard Chartered Bank - UAE
- Uttam Galva Steels Limited - India
- Minerals Council of Australia
- Petrochimia International Co. Ltd.- Taiwan
- Malabar Cements Ltd - India
- Edison Trading Spa - Italy
- Sindya Power Generating Company Private Ltd
- Kobexindo Tractors - Indoneisa
- Iligan Light & Power Inc, Philippines
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- White Energy Company Limited
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Energy Link Ltd, New Zealand
- Kapuas Tunggal Persada - Indonesia
- Essar Steel Hazira Ltd - India
- Singapore Mercantile Exchange
- OPG Power Generation Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Australian Coal Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Mintek Dendrill Indonesia
- Cigading International Bulk Terminal - Indonesia
- Georgia Ports Authority, United States
- Leighton Contractors Pty Ltd - Australia
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- Bangladesh Power Developement Board
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ambuja Cements Ltd - India
- Bhatia International Limited - India
- Kaltim Prima Coal - Indonesia
- ICICI Bank Limited - India
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- Indian Oil Corporation Limited
- Jaiprakash Power Ventures ltd
- Binh Thuan Hamico - Vietnam
- Central Java Power - Indonesia
- IEA Clean Coal Centre - UK
- Electricity Authority, New Zealand
- Parliament of New Zealand
- Banpu Public Company Limited - Thailand
- Agrawal Coal Company - India
- Planning Commission, India
- Coal and Oil Company - UAE
- Madhucon Powers Ltd - India
- Heidelberg Cement - Germany
- Port Waratah Coal Services - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- PNOC Exploration Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Bharathi Cement Corporation - India
- Grasim Industreis Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Indonesian Coal Mining Association
- Manunggal Multi Energi - Indonesia
- Commonwealth Bank - Australia
- Vedanta Resources Plc - India
- Riau Bara Harum - Indonesia
- European Bulk Services B.V. - Netherlands
- Latin American Coal - Colombia
- Oldendorff Carriers - Singapore
- Pendopo Energi Batubara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Mjunction Services Limited - India
- Global Green Power PLC Corporation, Philippines
- Chamber of Mines of South Africa
- Karaikal Port Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Romanian Commodities Exchange
- Sojitz Corporation - Japan
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement - Thailand
- Merrill Lynch Commodities Europe
- ASAPP Information Group - India
- Siam City Cement PLC, Thailand
- Meralco Power Generation, Philippines
- Chettinad Cement Corporation Ltd - India
- Metalloyd Limited - United Kingdom
- Sarangani Energy Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercator Lines Limited - India
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- Renaissance Capital - South Africa
- Holcim Trading Pte Ltd - Singapore
- Altura Mining Limited, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Star Paper Mills Limited - India
- Mercuria Energy - Indonesia
- Indogreen Group - Indonesia
- Interocean Group of Companies - India
- Thai Mozambique Logistica
- Aboitiz Power Corporation - Philippines
- Deloitte Consulting - India
- MS Steel International - UAE
- Borneo Indobara - Indonesia
- Gujarat Sidhee Cement - India
- Bukit Baiduri Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Global Business Power Corporation, Philippines
- SMC Global Power, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Australian Commodity Traders Exchange
- Petron Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Directorate General of MIneral and Coal - Indonesia
- Wilmar Investment Holdings
- Maheswari Brothers Coal Limited - India
- PowerSource Philippines DevCo
- Gujarat Mineral Development Corp Ltd - India
- Barasentosa Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- South Luzon Thermal Energy Corporation
- TNB Fuel Sdn Bhd - Malaysia
- Alfred C Toepfer International GmbH - Germany
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